End of financial year GJ000000 journal entry

[Greg_Shipp]

Hi,

I'm new to MYOB and this September/October 2022, will be my first time using MYOB for the end of financial year processes.

I've seen this journal entry, GJ000000, and would like to know what's going on behind the scenes.

I can see that it transfers my current year profit or loss to my retain earnings.

I assume it does this by summing total credits and debits from all the income and expense accounts and combining appropriately.

Is this calculation done everytime you run create a balance sheet? Or is there a psuedo-account somewhere with this information stored?

Through out the year the current year profit or loss 'account' appears to not be a real account in that there are no transactions made to it. The figures displayed in the interim balance sheet reports are calculations, made real when you close the financial year through the journal entry GJ000000. Is this true?

Does this journal entry, GJ000000, do away with the need to manually close the income and expense accounts? Ie. Do I still need to debit my income accounts and credit my expense accounts to zero them and transfer the balance to Equity (retained earnings)?

Regards,

Greg

[Mike_James]

Hi @Greg_Shipp , that journal is created automatically when you close a year in AccountRight. It avoids you having to do the manual transfer/closing entry you described. 

The current year profit account is a system account that AccountRIght uses to display the current year profit when creating a balance sheet report.

[Greg_Shipp]

Thanks @Mike_James, this is what I thought the journal entry did, but lookig back at previous closes, my income and expense accounts aren't closed. There is no transaction that zeroes these temporary accounts. Is this a MYOB setting that I need to change?