Fiscal periods and closing

A fiscal period is one month of your books. Closing it means saying: "this month is done, nobody touches it again", and moving the month's profit (or loss) into your accumulated earnings.

Read this article in full before closing your first period. Closing is IRREVERSIBLE: there is no "reopen" button.

Periods create themselves

You don't have to open anything. The first time an operation is posted in a calendar month that has no period yet, Prestafolio creates that month's period automatically, open and ready to receive entries.

Which means: if you start lending on March 3rd, the "March" period is born that day. You never have to remember to "roll the month", and you'll never get blocked for forgetting.

What closing is for

While a month is open, your revenue and expenses keep piling up in the 4xxx and 5xxx accounts. The close does three things:

1. Empties the revenue and expense accounts: leaves them at zero, ready for the next month.
2. Moves the net result (revenue − expenses) into 3202 Retained Earnings.
3. Seals the month: from then on, nothing more can be posted with a date inside it.

Closing gives you a firm historical number. Until you close, your Income Statement is still a moving picture.

The closing entry

Suppose a month with these balances:

• Revenue: interest RD$5,000, arrears RD$800, services RD$1,200 → RD$7,000
• Expenses: provision RD$2,000, operating RD$500 → RD$2,500
• Net result: RD$4,500 profit

The close posts a single entry, dated on the period's last day:

Look at what it does: it puts every result account on its opposite side (so it lands at zero) and sends the difference to Retained Earnings. Had the month been a loss, the 3202 line would go to the debit side instead. And it balances, like every entry.

If the month had no revenue or expense activity at all, the period still closes but no entry is generated (there is nothing to move).

How to close a period

1. Go to Accounting → Period close.
2. First review the month's trial balance and Income Statement. The net result you see there is exactly what the close will move.
3. Press Close on the period and confirm.

What blocks a close

The system stops you in three cases:

Why the order matters so much: if you closed August before July, July's activity (which has no closing entry yet) would be counted inside August's result, and then counted again when July is closed. Your profit would come out inflated. The chronological rule is what guarantees every peso of profit is counted exactly once.

What happens if you post into a closed period

Any operation whose date falls inside an already-closed period is rejected outright. Nothing is half-saved:

• A collection, a disbursement or a service charge with that date → the whole operation fails ("The fiscal period is closed") and neither the payment nor the entry is created. All or nothing.
• A manual entry with that date → rejected on save.

Reversals are the exception. If you need to reverse an entry living in an already-closed month, you can: the reversal does not go inside the closed month: it is posted in today's open period. The closed month stays intact and the correction is recorded in the present, which is exactly how an accountant would do it.

The irreversible part, plainly

• There is no "reopen a period". Once closed, it stays closed.
• The closing entry itself is a manual entry and can be reversed, but that does not reopen the period: the month remains closed and keeps rejecting new entries.
• So: review the trial balance before closing. It is the only moment when fixing things is cheap.

Plan and permissions

• Premium plan only (Financial statements module).
• Viewing the list of periods: permission accounting:read.
• Closing a period: permission accounting:close-period, a separate permission precisely because it is an irreversible action that shouldn't be lying around. The owner always can.