Account Closing Balance
Overview
Account Closing Balance – Business Overview
Account Closing Balance is a financial control document used to formally confirm and lock the ending balance of an account for a specific period. It helps businesses ensure that financial records are accurate, finalized, and ready for reporting, audits, or the start of a new accounting period.
This document plays an important role in maintaining financial discipline and transparency within Dafater.
Purpose in Business Operations
The Account Closing Balance is used to:
- Confirm the final balance of an account at the end of a day, month, quarter, or year
- Prevent unauthorized or accidental changes to past financial data
- Establish a clear financial starting point for the next accounting period
- Support accurate financial statements and audits
By using this document, businesses clearly signal that an account’s balance has been reviewed and officially closed for a specific period.
Prerequisites and Setup Requirements
Before using Account Closing Balance, the following should be in place:
- All financial transactions for the relevant period must be recorded and reviewed
- Accounts should be properly structured and actively used
- Any pending adjustments, corrections, or reconciliations should be completed
- Internal approval policies for financial closing should be defined
This ensures the closing balance reflects the true financial position.
Typical Workflow and Business Process Fit
Transaction Completion
All income, expenses, payments, and adjustments for the period are recorded.Review and Verification
Finance teams review account activity to confirm accuracy and completeness.Create Account Closing Balance
The closing balance is documented for the selected account and period.Approval and Confirmation
Authorized personnel confirm the balance, formally closing the account for that period.Period Transition
The confirmed closing balance becomes the opening reference for the next period.
This workflow ensures a clean and controlled transition between accounting periods.
Key Business Scenarios Where It Is Essential
Month-End and Year-End Closing
Ensures accurate financial reporting and compliance.Audits and Financial Reviews
Provides auditors with verified and locked balances.Management Reporting
Enables leadership to rely on finalized financial data for decision-making.Preventing Backdated Changes
Protects historical data from unintended edits after closing.Business Expansion or Restructuring
Establishes a clear financial baseline before major changes.
Important Considerations for Users
- Once an Account Closing Balance is confirmed, changes should be avoided unless formally approved
- Always ensure all transactions are posted before closing an account
- Closing balances should align with internal controls and approval authority
- Regular and timely use improves financial accuracy and accountability
- Clear documentation supports audits and regulatory compliance
Summary
Account Closing Balance is a critical financial control tool in Dafater. It ensures that account balances are reviewed, finalized, and protected, supporting reliable financial reporting, strong governance, and smooth period transitions.
Basic Information
- Module: Accounts
- Document Type: Document
Fields
| Field Name | Label | Type | Required | Options | Description |
|---|---|---|---|---|---|
| closing_date | Closing Date | Date | - | Date when account closing balance is recorded in Dafater | |
| account | Account | Link | Account | Account whose closing balance is maintained in Dafater | |
| cost_center | Cost Center | Link | Cost Center | Cost center associated with the account closing balance | |
| debit | Debit Amount | Currency | Company:company:default_currency | Total debit balance at closing date in company currency | |
| credit | Credit Amount | Currency | Company:company:default_currency | Total credit balance at closing date in company currency | |
| account_currency | Account Currency | Link | Currency | Currency in which the account is maintained | |
| debitinaccount_currency | Debit Amount in Account Currency | Currency | account_currency | Debit closing balance expressed in the account currency | |
| creditinaccount_currency | Credit Amount in Account Currency | Currency | account_currency | Credit closing balance expressed in the account currency | |
| project | Project | Link | Project | Project linked to this account closing balance | |
| company | Company | Link | Company | Company to which this account closing balance belongs | |
| finance_book | Finance Book | Link | Finance Book | Finance book under which the closing balance is recorded | |
| periodclosingvoucher | Period Closing Voucher | Link | Period Closing Voucher | Period closing voucher that generated this closing balance | |
| isperiodclosingvoucherentry | Is Period Closing Voucher Entry | Check | - | Indicates whether entry was created by a period closing voucher |
Permissions
| Role | Read | Write | Create | Delete | Submit | Cancel |
|---|---|---|---|---|---|---|
| Auditor | ✓ | |||||
| Accounts Manager | ✓ | |||||
| Accounts User | ✓ |
Related DocTypes
| DocType | Relationship | Module |
|---|---|---|
| Account | Links to | Accounts |
| Company | Links to | Setup |
| Cost Center | Links to | Accounts |
| Currency | Links to | Geo |
| Finance Book | Links to | Accounts |
| Period Closing Voucher | Links to | Accounts |
| Project | Links to | Projects |