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How do I close the prior years books to send to the accountant?

I want to close accounts (lock them) and send to accountant for the prior year. How do I do that?

Solved
Best answer 10-15-2018

Accepted Solutions
Moderator

Hi leith, Here's how to close the books in QuickBooks Onl...

Hi leith,

Here's how to close the books in QuickBooks Online:

  1. In the upper-right corner, click the Company name (gear icon).
  2. Select Account and Settings.
  3. Go to the Advanced tab,
  4. Under the Accounting section, put a checkmark in the Close the books box.
  5. Enter the Closing date.
  6. Set whether or not a password is needed to change closed transactions.
  7. Click Save.
  8. Click Done.

Fill me in if you have other concerns.

12 Comments
Moderator

Hi leith, Here's how to close the books in QuickBooks Onl...

Hi leith,

Here's how to close the books in QuickBooks Online:

  1. In the upper-right corner, click the Company name (gear icon).
  2. Select Account and Settings.
  3. Go to the Advanced tab,
  4. Under the Accounting section, put a checkmark in the Close the books box.
  5. Enter the Closing date.
  6. Set whether or not a password is needed to change closed transactions.
  7. Click Save.
  8. Click Done.

Fill me in if you have other concerns.

Not applicable

Re: Hi leith, Here's how to close the books in QuickBooks Onl...

Hello,

 

I have few confusions regarding the closing of books and will explain with example.

 

Scenario 1

Suppose today is 1 January 2019

My first fiscal month is January

If I go in the settings and close the books at 31 Dec 2018. so all the expenses and revenue will be Zero and go to their respective accounts?

 

Scenario 2,

Suppose today is 25 Nov 2018

My first fiscal month is January

If I go in the settings and close the books by giving date 24 Nov 2018, so all the expenses and revenue will be Zero and go to their respective accounts?

or

will the balances be transferred automatically on 1st January 2019

QuickBooks Team

Re: How do I close the prior years books to send to the accountant?

Thank you for further explaining your concern, rameez KButt.

 

Allow me to share some insight about closing books in QuickBooks Desktop.

 

The expenses and revenue will be zeroed out and will go to their respective account at the end of the year. While your net profit or loss into your Retained Earnings account. Your Retained Earnings account shows the total of your company's income and expenses from all previous years.

 

Closing of books through the accounts and settings only protects the transactions from being edited or deleted.

 

Here are the following articles to learn more about closing books and retained earnings in QuickBooks:

That's it. Should you have anything else you'd like to go over, feel free to reach out to us again. I'm always here to assist you further.

Not applicable

Re: How do I close the prior years books to send to the accountant?

what if i just closed the fiscal year 2017 today (don't ask :) ), how long does it take for my accounts to be zeroed out?  once i do that, i'll need to repeat the cycle to close 2018, and one 2018 is complete i should be able to put the next date in for 2019, correct?  thank you!

 

jenn

Moderator

Re: How do I close the prior years books to send to the accountant?

Thank you for checking in with us, jennifer m.

Allow me to share a little information about closing the books in QuickBooks Online.

 

QuickBooks Online automatically closes out your Income and Expense accounts and rolls up your net profit or loss into your Retained Earnings account.

 

In QuickBooks, closing the books lets you set a password for a closed book. 

 

To close the books:

 

  1. In the upper-right corner, click the Company name (gear icon).
  2. Select Account and Settings.
  3. Go to the Advanced tab,
  4. Under the Accounting section, put a checkmark in the Close the books box.
  5. Enter the Closing date.
  6. Set whether or not a password is needed to change closed transactions.
  7. Click Save.
  8. Click Done.

For more insights, check out these recommended articles:

 

 

Keep me posted if you have other concerns. I'll be around to help.

Not applicable

Re: Hi leith, Here's how to close the books in QuickBooks Onl...

Hi,

 

I just followed the instructions to close out the books, and then went into my journal entries to see what QB had done. Apparently not one change had been made, nothing was zeroed out. No journal entries found related to this.

 

So...what exactly am I supposed to notice when I "close out the books" by clicking that option?

 

Thanks!

QuickBooks Team

Re: Hi leith, Here's how to close the books in QuickBooks Onl...

Greetings, Wisdom Ways.

 

I'm here to provide additional clarification about closing books in QuickBooks.

 

At this time, you won't be seeing any changes, asides from QuickBooks asking you to enter a password if you try to edit transactions prior to the Closing Date. QuickBooks will only zero out your Income and Expenses and roll up your net profit or loss into your Retained Earnings account at the end of the year. For more information about this, I recommend following this article: How to close the books

 

I hope that clears everything up. Please let me know if there's anything else you need, I want to make sure you're taken care of. Thanks for reaching out, wishing you and your business the best.

Established Community Backer ***

Re: Hi leith, Here's how to close the books in QuickBooks Onl...


@AldrinS wrote:

 

 

 QuickBooks will only zero out your Income and Expenses and roll up your net profit or loss into your Retained Earnings account at the end of the year.

 


 


I am surprised that this answer is saying that QuickBooks will zero out your Income and Expenses at the end of the year. This is blatantly incorrect and misleading.

 

Nothing is zeroed out in QB when you check the "Close the books" box in Settings, ever.   All that happens  is that if a user attempts to add or edit a transaction dated before the date entered in the Closing Date box, a warning will be displayed, and if a password is entered, a password will be required. 

In QB, the dynamic Retained Earnings and Net Income amounts are recalculated every time you run a balance sheet, depending on the time period of the balance sheet , and the fiscal year entered in Settings.

Not applicable

Re: Hi leith, Here's how to close the books in QuickBooks Onl...

Hi James,

 

I followed all the steps. However, I did not see the Close the books checkbox for me to click. Could you advise? Thank you!

QuickBooks Team

Re: Hi leith, Here's how to close the books in QuickBooks Onl...

I see that this is a duplicate post, Abby7700.

 

I've answered your post with the same concern. Please refer to this link:

 

https://quickbooks.intuit.com/community/Reports-and-accounting/How-to-lock-closed-periods/m-p/271555...

 

You're always welcome to post anytime if you need our help. 

Not applicable

Re: Hi leith, Here's how to close the books in QuickBooks Onl...

The did that same thing, set a closing date of 06/30/2018 after realizing a closing date was never entered.  This company's fiscal year is 07/01 through 06/30.  I am trying to get their books in order for 07/01/2018 - 06/30/2019.  After I set the closing date to 06/30/2018 so that the beginning balances for income and expense accounts would be zero starting 07/01/2018 nothing happened.  The balances rolled over.  Is there a way to get that to work?


Sara

QuickBooks Team

Re: Hi leith, Here's how to close the books in QuickBooks Onl...

Hello there, @SaraLyn7336.

 

When you set the closing date of your accounts in QuickBooks Online, it will not zero out your beginning balance. Instead, it closes out your Income and Expense accounts and rolls up your net profit or loss as your Retained Earnings.

 

If you want to zero out the beginning balance, you can create a journal entry. Here's how:

  1. Click the Plus Icon (+).
  2. Choose Journal Entry.
  3. Fill out the fields to create your journal entry.
  4. Click Save and Close.

For more detailed steps, you may refer to this article: Create a journal entry.

 

To learn more, you may check these articles:

Always feel free to get back to us here in the Community if you have other questions. I'm just a few posts away.  

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