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End of Financial Year Process for New Zealand

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Jim2 Workflow

March 1

Review all your Jim2 lists. Check all lists daily, eg. job list, quote list. It's also good practice to follow the End of Month Procedure on a regular basis.

Commence debtors clean-up:

Chase up outstanding debt and collect the payments. Record the payments in Jim2.

Write off old debts that you do not expect to collect (Debtor Adjustment Down or Bad Debt).

Write off/adjust rounding and other errors which have left debtors owing small amounts (eg. $0.01) (Debtor Adjustment Down or Discount).

Allocate all unallocated prepayments and credits.

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This is especially important if you have invoices and payments/prepayments in foreign currency.

Commence creditors clean-up

Finalise any outstanding issues you have with vendors, including returns to vendor.

Allocate all vendor credits.

Review all vendor payments due. Record vendor payments in Jim2, including direct debit, EFTPOS and credit cards.

Petty cash

Reconcile petty cash account and reimburse the float.

Banking

Bank all received money.

Complete all banking sessions and fix all problems with unbanked funds.

 

March 23-31

Ensure any stock sold in advance has been back-filled.

Perform and finish your stocktake(s).

Finish all stock adjustments.

 

March 31

Final stock valuation.

Final Multicurrency valuation if required.

Archive your Jim2 database as at March 31. Ensure you perform a backup before trade on April 1 (last activity on March 31).

Info

Jim2.Cloud clients do not need to perform the backup. Happen Business will do this when necessary. Contact support@happen.biz when you are ready for the backup to be performed.

 

April 1-15

Reconcile all bank and credit card accounts.

Complete your June GST session.

 

Closing the Financial Year Checklist

The closing the financial year procedure is integral to maintaining an accurate Jim2 database. We recommend that you complete the following tasks when approaching the end of the financial year.

 

Please note that the Jim2 closing the financial year procedure is not reversible, therefore we strongly recommend the following checks be completed, and your accountant is made aware that you are closing the financial year in Jim2.

 

Jim2 General Ledger

Check the balance in the 3-9999 Historical Balancing account has been brought to zero. This is important to new users who have implemented Jim2 in recent years and have not performed the closing process previously. If the 3-9999 Historical Balancing account is showing a figure other than zero, you must complete the Clear the 3-9999 Historical Balancing Account process before you can close off the financial year in Jim2 and continue trading.

 
Jim2 Workflow

Review all active quotes and check status. Cancel any expired or duplicated quotes.

Review all active purchase orders and check status. Chase supplier invoices for all those on Received and finish them once the invoice is received. Cancel any expired or duplicate orders.

Review all active jobs and invoice any that can be invoiced. Cancel any expired or duplicated jobs.

Check your bank deposits and resolve any old unbanked transactions. Check for duplicate entries (to be deleted or reversed) and review your debtor records. Otherwise, complete the banking session as normal.

Check there is no stock sold in advance. On the ribbon, go to Management > Reports > Stock Reports > Stock in Advance Liability. Display the report up to the end of the financial year you wish to close.

Check that your stock value agrees with the general ledger value. On the ribbon, go to Management > Reports> Stock Reports > Stock Value by GL > Summary.

Perform a stocktake – please refer to the section on Jim2 Stocktake Preparation below.

 

Jim2 Accounting

Reconcile all accounts:

Debtors

Creditors

Bank accounts/credit cards

Petty cash

Resolve any old entries that are still outstanding, as they may be impacting on your debtor and creditor records.

Tax/GST compliance has been completed and lodged.

All Multicurrency valuations have been completed if required.

Ensure that all adjusting general journals issued by your accountant have been finished.

Print Reports:

Stock Valuation by COGS at close of business on March 31.

(Note: You cannot backdate this report.)

Stock Value by GL Group (Summary) report, to ensure your stock value balances with your GL.

Detailed Aged Receivables (as soon as all March transactions are complete).

Detailed Aged Payables (as soon as all March transactions are complete).

Ensure that you have closed off any previous financial years. You can have two financial years running concurrently in Jim2, but no more.

 

Please refer to How to Clear the Historical Balancing Account for the next step in the end of financial year process.

 

Jim2 Stocktake Preparation

As your business trades throughout the year, stock is:

purchased and sold

stolen/damaged

returned to suppliers

transferred between locations

loaned to customers.

 

With all these movements, it is necessary to confirm stock quantities on a regular basis.

 

Stocktakes are undertaken to confirm that the asset value of your stock is accurate compared to your Jim2 balance sheet, and the quantity of stock is accurate compared to your stock on hand quantities in Jim2.

 

Outcomes of Stocktake

Your gross profit is based on the income from the sales you make, the cost of purchasing your stock, and the management of your stock. There is an impact on your profit when the value of the stock in your stocktake is less than your balance sheet expects, and the loss is recorded as a stock adjustment expense.

 

Stocktakes should be carried out throughout the year. The stocktake involves counting the stock quantities and matching these to Jim2. The variances are then recorded as stock adjustments, and will alter your balance sheet, your profit & loss reports, and your stock on hand quantities.

 

Preparation for Stocktake

Stocktake requires planning and preparation. It's important that the stock to be included is tidied up and made available for counting. Here is a checklist for stocktake preparation in Jim2:

As many jobs as possible should be invoiced.

A minimal number of jobs not invoiced.

All purchase orders on Received status (with appropriate tax invoices) should be changed to Finish.

Backfill all stock sold in advance, provided you have available stock on hand to backfill with. On the ribbon, go to Stock > Extras > Backfill. Click Select All and click Backfill.

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Run a stock list sorted by stock on hand. It is advisable to fix the negatives prior to conducting a stocktake session (transfer stock, or stock adjust, or finish a PO).

Re-run Backfill stock sold in advance.

Print a list of stock sold in advance that cannot be back-filled. On the ribbon, go to Management > Reports > Stock Reports > Stock in Advance Liability report. These stock codes will need to be excluded from the stocktake session.

stock in adv liability

 

As stocktake sessions are conducted by stock location, it's important to suitably arrange the stock in each location. These locations typically include stores, showrooms, warehouses, damaged goods areas, company vehicles, warehouses, etc. Poor layout of stock will lead to a poor count. Areas of concern are stock on display (away from the general stock), stock in cabinets or drawers, stock on point of sale counters, stock in offices, stock on loan to customers or staff, and any stock supplied to jobs that haven't been invoiced.

 

Stocktake Sessions

In Jim2, a stocktake session can be run at any time for any selection of stock within a location. This means that you can stocktake the whole showroom or just one stock code, and report the results in both the accounting and stock control sections of Jim2. This functionality allows you to conduct regular cyclical stocktakes, which are easier than one annual stocktake.

 

When a stocktake session is commenced, all stock involved in the session is locked, ensuring accounting transactions can’t be passed against these stock codes. When the count has been completed, the results of the count are confirmed and the session is saved with a Finish status.

 

The Finish status of the stocktake session creates a stock adjustment on Booked, which you can view, investigate, then finish. The finished stock adjustment will have either an expense or income value, which will be posted to your stock adjustment account. The relevant asset accounts in your balance sheet will also be adjusted to record the variance of stock on hand.

 

Once the stocktake session and the stock adjustment have been finished, you will have accurate stock quantities in Jim2, and stock will be unlocked.

 

Adding or Managing a Stocktake Session

Stocktake icon

 

Once the preparation has been completed, a stocktake session can be commenced. To access the stocktake list go to Stock > Stocktake, then click Add.

 

A stocktake session is by location, and further filtering can be applied. This filtering can included report level groups, allowing you to only require counting of particular product groups.

 

See Stocktake Session for the full functionality.

 

Managing Your Work Practices After Completing a Stocktake Session

Having completed a stocktake, your company's work practices will then influence the accuracy of your stock records. Correct management will allow you to accurately report stock valuations based on the information contained in a number of Jim2 reports, as well as the general ledger. Poor work practices will quickly lead to incorrect stock valuation reporting.

 

Info

A stocktake session is first by location, then further filtering can be applied. This filtering can include Report Level groups, allowing you to only require counting of particular product groups.

 

For further assistance or information, please call Happen Support on 02 9570 4696, or email support@happen.biz

 

You can read about Stocktake in more detail here.

 

Close Financial Year in Jim2

With the financial year checklist complete, all users can commence the close financial year procedure. Ensure you have approval from your accountant to do so, as once the financial year is closed, it cannot be reopened.

 

Info

Jim2.Cloud clients will need to contact Happen Business (support@happen.biz) to have us stop the cloud instance prior to closing the financial year.

 

Jim2 allows you to operate for up to 12 months after the end of the current financial year before it is compulsory to finalise and close off the previous financial year.

 

Recommended: prepare to close in the training database

To ensure an efficient closing process in the main database with little impact on other users, we suggest that you back up your main database and restore it as a training database.

 

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You must stop Jes prior to restoring the training database, then restart once the restore is complete.

 

This enables you to prepare the close the financial year procedure in the training database, and routinely switch back to the main database to make the required adjustments. With preparation complete, perform the Close Financial Year Wizard for a second time in the main database, which will be a quick process as all the red flags have been addressed.

 

This is very important as other users cannot be logged on to Jim2 when running the Close Financial Year Wizard in your main database, because you must stop the Jes (Jim2 eBusiness Server) instance, complete the close process, then restart the Jes instance, after which users can log on to Jim2 once again.

 

Logging off sys and stopping the Jes instance

The user sys is the Jes instance for the Jim2 database, and controls the flow of emails, vendor feeds, mobile functionality, etc.

 

To stop the Jes (Jim eBusiness Server) instance, go to the Jim2 Jim2 Configuration Manager. You will find this on the server where Jim2 is installed. In Windows go to Start Menu > Happen Business Folder > Jim2 Server > Jim2 Configuration Manager. Double click to open.

 

Right click on the Jes Instance for the required database and click Stop.

 

stop jes

 

Further information:

Accountants End of Year Adjustments

Close Financial Year FAQs

Close Financial Year Wizard

End of Financial Year