How to run a month end close in Business Central

Start the month end close in Business Central with the subledgers

Begin where the transactions are. Post every sales invoice and credit memo for goods you shipped in the month. Enter and post the vendor invoices you have received. Apply payments to the documents they settle. To find open documents with a posting date in the period, filter the sales and purchase order lists.

Then compare each subledger with its control account. Run the Aged Accounts Receivable and Aged Accounts Payable reports as of the last day of the month. They should equal the receivables and payables accounts in the trial balance. If they differ, look for journals that someone posted straight to those accounts. Correct them before you move on.

Settle inventory cost before the Business Central month end close

Run the Adjust Cost - Item Entries batch job. Then late purchase invoices and item charges flow through to cost of goods sold. If Automatic Cost Posting is off, follow it with Post Inventory Cost to G/L. Only after both jobs finish does the inventory account match the subledger.

Check the result with the Inventory Valuation report as of the period end date, and compare it with the inventory accounts. Post any physical count differences through the Physical Inventory Journal first. Manufacturers should also look for production orders that are complete but still released. Their cost stays in work in process until you change the status to Finished.

Reconcile banks and post recurring entries

Reconcile every bank account on the Bank Acc. Reconciliation page, up to the statement ending date. Post bank fees and interest as you go. Companies with foreign currency balances then run the exchange rate adjustment. That restates open receivables, payables and bank balances at the closing rate.

Fixed assets need the Calculate Depreciation batch job. It fills a fixed asset journal for you to check and post. Recurring General Journals handle entries that repeat each month, such as rent allocations. They can also reverse themselves on the first day of the next period.

Lock the period to finish the close

Business Central does not close months one by one the way some systems do. Instead, you control posting dates. In General Ledger Setup, move Allow Posting From to the first day of the new month. In User Setup, you can give named finance users a wider range.

Inventory Periods add a separate lock for item transactions. You can close a period only once its items are fully cost adjusted. At the end of the fiscal year, close the year on the Accounting Periods page. Then run the Close Income Statement batch job. It creates the journal that moves net income to retained earnings.

Report and improve the month end close in Business Central

Run the trial balance and scan it for accounts with an unexpected sign or a balance in a suspense account. Then produce the income statement and balance sheet from Financial Reports. Add a comparison to the prior month, and to budget if you keep one.

Write the steps down in order, with an owner for each. Most delay comes from late vendor invoices and manual reconciliations. Workflows and bank feeds can reduce both. Our consultants can look at your close with you and suggest where to start.

Business Central month end close: questions

Is there a period close button in Business Central?

Not for months. You restrict posting dates in General Ledger Setup and User Setup, and you can also close inventory periods. A formal close exists only for the fiscal year. It runs through the Accounting Periods page and the Close Income Statement batch job. So treat each month as a checklist, not a button.

In what order should the close steps be done?

Work from subledgers to the general ledger. Do sales and purchases first, then inventory cost, banks, fixed assets and currency. Then do accruals and corrections. Lock the period and report last. If you run the inventory adjustment before the final purchase invoices post, you must run it twice.

Can accruals reverse automatically?

Yes. A Recurring General Journal line can use a recurring method that reverses the entry on the following day. That suits month end accruals. Standard general journals also allow a reversing approach. You can reverse posted journal entries from the register. So you have several routes, and you can pick the one your auditors prefer.

What if someone needs to post to a closed month?

An administrator widens the allowed posting dates for that user in User Setup. The user posts the entry, and then the administrator narrows the range again. Keep a note of why, because anyone who relies on issued statements needs an explanation for a change after the fact.

How can we make the close faster?

Automate what repeats. Schedule cost adjustment in the job queue. Use bank feeds with automatic matching. Set up recurring journals. Route vendor invoices through approval workflows so they arrive on time. Keep a written checklist with owners, and note each delay so you can remove its cause next month.

Guides for each close step

Several steps in a Business Central month end close have their own guide. These pages explain bank reconciliation, inventory costing and the finance services we provide for teams that want a cleaner close. Read the one for the step that costs you most time first. Our consultants can also sit with your team during one close, note where it slows, and suggest simple fixes that your own staff can keep running. For the product detail, see Closing years and periods on Microsoft Learn.