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When running the Year-End Close Process: Retained Earnings is by Financial Dimension instead of just 1 line for Retained Earnings


Tip of the Day: In Microsoft D365 Finance and Supply Chain (D365 F&SC), it’s that time of year again where you are running the Year-End Close process, which transfers the balances of your income and expense accounts to the Retained Earnings account. This way, you can start the new year with zero balances in those accounts and reflect the correct equity in your Trial Balance. However, if you notice that your Retained Earnings account has Financial Dimensions assigned to it, all you need to do is make a setup change and run the Year-End process again to remove the Financial Dimension in Retained Earning. If you want to learn more about how to do this, please follow the link below.


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SCENARIO: When running the Year-End Process to roll the P&L into Retained earnings, most companies want all the amounts to be in the Retained Earnings account without Financial Dimensions. However, when you run the Year-End process if the values are rolled into Retained Earnings by Financial Dimension instead of just 1 line for retained earnings.

 

SOLUTION: To get 1 line for retained earnings, set each dimension to CLOSE SINGLE and leave the financial dimension blank.


The Transfer profit and loss dimensions section is used to specify which financial dimensions on transactions that are posted to profit and loss accounts will be transferred to the retained earnings main account. First, identify the financial dimensions that are relevant to the selected legal entity. These financial dimensions include any financial dimension that was posted against during the year, even if the financial dimension isn't part of an active account structure. Next, define each dimension as either Close single or Close all. The default option is Close all. This option maintains the original financial dimension values from posted transactions and uses them to create the opening balances for the retained earnings account. Separate retained earnings beginning balances will be created for each unique combination of financial dimension values. If Close single is selected, all posted transactions that have that financial dimension will be summarized into a retained earnings beginning balance for the dimension value that is entered in the field that appears after Close single. For example, all transactions for the fiscal year were posted with the account structure Main account - Department. For the Department financial dimension on the template, Close single is selected, and 100 is entered as the dimension value. If the total income of all transactions that are posted to departments 200, 300, and 400 is $100,000, one opening balance will be created for Retained earnings - 100. If you select Close single but leave the financial dimension value blank, all transactions will be posted to retained earnings, and the dimension value will be blank.


Navigate to General ledger > Ledger Setup > Year-end close template setup > set each dimension to CLOSE SINGLE and leave the financial dimension blank.


**Note: You must do this per legal entity.

 



 


 

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