Year-end closing

[fbcsequim]

We are running PowerChurch 12.2. Our church fiscal year ends Sept 30 and we are running on a cash basis, not accrual. The last time a year-end closing was done was in 2017. The person who did the books before me wanted to be able to make corrections or adjustments in the old year once the new year had started, so they just never bothered closing years.

Two questions: 1) Is it possible to close a year after you have started posting into the new year, or do you have to hold off posting things for the new year until the old year is closed? 2) If the former is true, then can I go back and close each of the past open years, one after the other, without creating any problems?

[NeilZ]

We are running PowerChurch 12.2. Our church fiscal year ends Sept 30 and we are running on a cash basis, not accrual. The last time a year-end closing was done was in 2017. The person who did the books before me wanted to be able to make corrections or adjustments in the old year once the new year had started, so they just never bothered closing years.

Two questions: 1) Is it possible to close a year after you have started posting into the new year, or do you have to hold off posting things for the new year until the old year is closed? 2) If the former is true, then can I go back and close each of the past open years, one after the other, without creating any problems?

As to your questions:
1. NOT true .. you can post at any time. The system will post to the month as listed on the transaction, there is no limitation.
2. Since 1 was not true, there's no need to close any years, but in any case it will not cause any problem.

FWIW .. you really don't need to close ANY month or year. Its not required in the program. However, if you do close a year, you will not be able to may any adjustments to anything that may have been done in error. So it is ALWAYS a good idea to keep the previous year open for adjustments.

[fbcsequim]

Thanks for the answer. I've never used accounting software before where closing the year was optional. This makes things more flexible for sure.

[NeilZ]

Thanks for the answer. I've never used accounting software before where closing the year was optional. This makes things more flexible for sure.

Most accounting software was developed for business, not church fund accounting. There's a big difference, and not having to close months, let alone years, gives a lot of flexibility when having to correct previous errors in expenses and/or budgets.

[fbcsequim]

I've always worked in a non-profit setting and have worked with different non-profit fund accounting software (some very expensive ones too I might add), and they all required that a year be closed. The closing would post income and expense account balances into the fund balance (net asset) accounts and zero the income/expense accounts ready for the new year. I see this is done "dynamically" in PowerChurch, not when a year is closed. The "system generated" entry in a net asset account is always being updated as posting is done. Very flexible! (The income/expense accounts must also zero automatically to start a new year.)

One more question ... Am I correct that there is no year-end closing menu option in PowerChurch, meaning you have to close all 12 months one at a time to close a year?

[NeilZ]

I've always worked in a non-profit setting and have worked with different non-profit fund accounting software (some very expensive ones too I might add), and they all required that a year be closed. The closing would post income and expense account balances into the fund balance (net asset) accounts and zero the income/expense accounts ready for the new year. I see this is done "dynamically" in PowerChurch, not when a year is closed. The "system generated" entry in a net asset account is always being updated as posting is done. Very flexible! (The income/expense accounts must also zero automatically to start a new year.)

Correct ... the I&E will automatically zero at the beginning of the fiscal year you set.

One more question ... Am I correct that there is no year-end closing menu option in PowerChurch, meaning you have to close all 12 months one at a time to close a year?

That is correct. There was an evolution in this over the years. Initially there was a list of 'year end' things to do, now its a suggestion. Once you could only have 6 months open, then 12, then 18, now unlimited. These were all based on user requests over the years.

Hope this helps

[fbcsequim]

Interesting. Yes, your answers have helped. I appreciate the historical background you have on this software. And it's good to know the software authors have listened to the users over the years. Out of curiosity, is there an established way for users to submit requests for changes?

[NeilZ]

Interesting. Yes, your answers have helped. I appreciate the historical background you have on this software. And it's good to know the software authors have listened to the users over the years. Out of curiosity, is there an established way for users to submit requests for changes?

Requests are always welcomed by the developers. Send your request to 'wishlist@powerchurch.com'. I would include the following:

1. Reason for change: how will this assist you to save time and effort
2. Exactly what you would like to see. How do you expect the change to work.
3. Will this change be beneficial to the majority of other users?