The end of the year is a busy time for most restaurant groups. During this time of year, your year-end closing procedures are critical. Instead of scrambling, use our accounting tips to organize the way you wrap up the year and set-up 2023 to be even more successful. Your accounting and outsourcing services can as well help you prepare your year-end financial statement.
Tip 1: Review Your External Systems Integrated with Sage Intacct
It’s important to start your year-end closing process outside of Sage Intacct. You will first want to review any and all of your external systems that would impact Sage Intacct. Make sure to validate that all of the transactions for the year have synced within Sage Intacct. Review all items within your expense software, your POS software and any other external systems to ensure there aren’t any missed transactions or errors within Sage Intacct.
Tip 2: Ensure All Subledger Transactions Have Been Recorded
You will want to ensure you have a record of any other subledger transactions you’ve accumulated throughout the year. This includes things such as:
- Prepaid Entries
- Account Payable Bills
- Account Receivable Invoices
- Cash Receipts
- Fixed Assets Depreciation Entries
- Payroll Journal Entries
Ensuring you have kept track of all the above-mentioned transactions is crucial in safeguarding a successful year end closing for Sage Intacct. You will not want to move forward with processing year end closing until all these subledger transactions have been accounted for.
Tip 3: Look for Any Transactions in an Indeterminate State
After ensuring all of the subledger transactions have been accounted for and are posted, you then check for any transactions that may be in an indeterminate state. Transactions could include:
Draft Transactions
Using the “STATE” field in any transaction list view filter for “Draft” states. This will display any transactions that have not been posted. You will want to review and post these transactions.
Recurring Transactions that have Failed
Recurring transactions can fail unexpectedly as a result of any modifications made to the system, such as adding or deactivating a dimensional requirements to an account as well as when applying a new smart rule. Luckily within Sage Intacct these transactional failures are easy to catch. Inside every module that allows you to schedule transactions will be a recurring transaction status report. This will provide a simple and fast way to identify those transactions that need to be corrected.
Unapproved Transactions
For companies who utilize the approval process within Sage Intacct for transactions, they will want to ensure all outstanding journal entries, purchasing transactions, AP bills, AP payments, or employee time/expenses have been approved. A list view, like draft transactions, can quickly reveal transactions that have been “submitted” or “partially approved.” If your company is not utilizing these approvals, you will want to skip this one.
Tip 4: Close the Subledgers
Sage Intacct allows for subledgers to be closed individually. This allows companies to secure the Accounts Payable, Accounts Receivable, Cash Management, and/or Time & Expense subledgers while still being able to record any month-end journal entries. Remember that when closing a subledger any co-dependent modules will also be closed. For example, Purchase Order closes when the AP module is closed, and Order Entry closes when the AR module is closed.
Tip 5: Reconcile Subledgers to the General Ledger
Once you have closed the subledgers you will be able to reconcile them to the General Ledger. Here are steps to follow for reconciling your AP and AR modules to their respective GL accounts:
ACCOUNTS PAYABLE
- Run the Vendor Aging report as of 12/31/2022 and note the total.
- Run the General Ledger report as of 12/31/2022 for your Accounts Payable account.
- Check that the GL AP balance matches the vendor aging report.
ACCOUNTS RECIEVABLE
- Run the Customer Aging report as of 12/31/2022 and note the total.
- Run the General Ledger report as of 12/31/2022 for your Accounts Receivable account.
- Check that the GL AR balance matches the vendor aging report.
Tip 6: Post Month-End Journal Entries
Companies will want to post all month end journal entries. However instead of manually processing these each month, consider the following automation options available within Sage Intacct.
- Creating Memorized transactions
- Utilizing Dynamic Allocations to automate your month-end allocations
- Importing journal entries
Some examples to consider the above for would be the accruals, allocations, payroll or depreciation entries. Please reach out to a member of our Tablespoon team to discuss how to setup any or all of these options in your instance of Sage Intacct.
Tip 7: Reconcile Bank Accounts and Credit Cards
Once all the month-end journal entries have been posted, you will want to reconcile your bank and credit card accounts. Within Sage Intacct bank and credit card feeds are available as part of your subscription in an effort to move toward a continuous close. If you need assistance with this process, please contact a member of our Tablespoon team.
Tip 8: Close the General Ledger
After all of the reports have been run, you are ready to complete your financials by closing the General Ledger module. Closing during the month of December 2022 will close the entity for all periods from January 1, 2022, to December 31, 2022, but only if you have not been closing your books on a monthly basis. If you have been keeping up with the best practice of a monthly close your “Close business books from” date should likely be December 1, 2022.
Tip 9: Add Reporting Periods (if needed)
One last step to ensure you do is to plan out your reporting periods. With the start of a new year, several reporting periods for budgeting, reporting, and closing have yet to be established. Reporting periods were set up initially by your implementer during configuration. Only the last year, current year and next year were created during configuration. With only a few clicks, your 2023 reporting periods will be ready to go!
Tip 10: Checklist
Consider creating a year end checklist with Sage Intacct’s Checklist feature. Checklists allow companies to capture processes like:
- General Ledger Period and Year End Close
- Activities around complying with regulatory agencies
Just be sure to review these checklists at a minimum annually to ensure all tasks and process changes are captured.
Next Steps
Don’t be overwhelmed. Reach out to our team of restaurant accounting experts to help you make sense of your year-end accounting. Contact our team >