6050 General Ledger Monthly Closing Procedure

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6050 General Ledger Monthly Closing Procedure

Overview: There are three (3) steps to properly create, enter and balance the summary transactions from Smarts2 into QuickBooks so you can generate an income statement.  These three steps are:

1.Reconcile bank statement with QuickBooks

2.Enter the GL account balances from Smarts2 into the QuickBooks Journal Entry Template

3.Reconcile the Smarts2 Accounts Receivable (“AR”) balance with the balance in QuickBooks

Step 1 - Reconcile Bank Statement

A)In Smarts2, begin by pulling down the “Monthly Batch Summary” for the month you are closing:                        

                          AccountingèReportsèMonthly Batch Summary

**Print off the report and keep for your reference when reconciling the bank statement (next)

 

B)Get your bank statement and in QuickBooks reconcile the bank account for the month you are closing. The Monthly Batch Summary is a list of made deposits and should agree with the individual deposits posted in QuickBooks that also appear on your bank statement.  If not, investigate and make necessary corrections.

Step 2 – Complete Excel Journal Entry Template

A)In Smarts2 portal, pull down the General Ledger Report for the month you are closing

AccountingèReportsè General Ledger

**Prefer that you print off the Summary Section (at the top) for your reference in the next step but this is not mandatory because you could input directly from this screen into the excel template

(Highlight the section, right click and choose copy.  Open an excel spreadsheet.  Right click and choose ‘Paste Special/ Text’.  Columns may need to be adjusted to accommodate the information.)

 

B)Call up in Excel the following template file for populationèGL Data Spreadsheet Entry Template.xlsx

a.Open up the Excel File. Only enter numbers into the yellow highlighted fields.  The entries automatically calculate based on formulas. The entries are in blue font.

b.Using the General Ledger Report from SM2, populate the excel template file using the figures found on the summary report (Steps #2-7).  You are reproducing the General Ledger from SM2 in in the Excel File Template.  Make sure the totals agree

**Print off the created Excel File Template for your reference in the next step

c.In QuickBooks, for the month you are closing, make four individual general journal entries each for Steps 4, 5, 6, and 7.  These four general journal entries post the SM2 information into QuickBooks for the month (at a summary level).

d.In Step #7, if A/c 2010 appears with braces () in the credit column you will need to data input this as a positive debit for Step #7 in the QB general journal entry

e.Save the Excel File Template for use in closing the next month.  When initiating next month’s close, you will copy the existing sheet tab into a fresh sheet tab so the new sheet tab can accept the data inputs for next month.  Label each created sheet tab in the Excel Template by the name of month

 

C)In Smarts2 portal, pull down the Statement Summary Report for the month you are closing

AccountingèReportsèStatement Summary Report

**Print off report for your reference in the next step.

A reminder when the Statement Summary Report is queued to load the current month so be sure to change to the month you desire and click Load, then you can Print or Export.

 

D)On the Statement Summary Report, compare the “Pmt to SP” total to net posted total in A/c 2010 in your QuickBooks for the month you are closing.  They should be the same.  If not proceed to next step.

 

E)Review Step#7 of the Excel File Template.  If A/c 2010 has a balance (+ or -), then a variance item was created during the SP Statement Close process.  The created variance is not flowing through the ledger and it needs to be manually handled with a general journal entry.

In Step #7, if account 2010 has a positive credit amount, make a correcting Quickbooks general ledger entry to debit account 2010 for the amount and credit account 5000 (Pmts to SPs).

If Step #7 has a negative credit (in braces), make a correcting Quickbooks general ledger to credit account to account 2010 for the amount and debit account 5000 (Pmts to SPs).

 

Step 3 – Reconcile Smarts2 AR balance with QuickBooks AR balance

 

A)To reconcile your Accounts Receivable, for the month you are closing, in SM2 portal

AccountingèAR / CollectionsèAcct Rec O/S

To run an aging for the month you are closing set the “Age Date” to the last day of the month with the calendar selector.

 

**Prefer that you print off the Acct Rec O/S Summary for your reference in the reconciliation but this is not mandatory because you can always regenerate this view by entering the appropriate date.  This will be a future printable report

(The Aging Report can be a little tricky to export to excel because it may display on multiple pages. If it displays on multiple pages then you need to highlight each page and do as follows. Highlight the section, right click and choose copy.  Open an excel spreadsheet.  Right click and choose ‘Paste Special/ Text’.  If more than one page then repeat. Columns may need to be adjusted to accommodate the information).

 

B)In QuickBooks, query a balance sheet using the same aging date as the SM2 format: (XX/31/16)

 

C)From the Balance Sheet, compare the balance on account 1200(A/R) to the “Net Due” amount from your printed reportèthey should be the same.  If not, a general journal entry will need to be made to bring the QuickBooks 1200 account balance into agreement with the SM printed report.  In any given month, any necessary correction in QuickBooks could be a increase (Debit) or a decrease (Credit) to account 1200 for the amount in question with the offset posted to A/c 7065 (Bad Debt Expense).

D)