An accurate and timely closing will help your DLC make an effective and seamless transition to the next fiscal year.

Identify key deadlines and procedures

In June, make note of key deadlines and procedures associated with closing a fiscal year. Refer to the budget closing page of this website for more information on VPF’s closing demonstration and schedule postings. Review these Year-End Close out Tips and the FY17 Closing schedule.

Pay particular attention to the various deadlines related to key categories, such as accounts payable, travel, payroll, Work Breakdown Structure (WBS) elements, cashier services, accounts receivable billing, credit card transactions, and internal provider activity.

Review guidelines for accruals and deferrals

Use this table for general guidance on accruals and deferrals at fiscal year-end closing.

Activity Type Accrual/Deferral Type Accounting Action*
Goods or services received by or provided to MIT in the current fiscal year that will not be paid until the next fiscal year (check Period 13 summary statement before accruing). Accrued Expenses Debit appropriate cost object** and cost element and then credit Internal Order 1216800 using the same cost element. In the absence of an actual invoice, use a reasonable estimate.
Goods or services provided by MIT in the current fiscal year for which payment will not be received until the next fiscal year. Accrued Income Debit appropriate cost object and cost element and then debit Internal Order 1078201 using the same cost element. In the absence of an actual bill, use a reasonable estimate.
Goods or services paid for in the current fiscal year that relate to the next fiscal year (e.g., prepaid rent or insurance). This includes invoices processed by Accounts Payable by June 30 for activities that relate to the next fiscal year. Deferred Expenses Debit appropriate cost object** and cost element then debit Internal Order 1121400 using the same cost element. DO NOT defer expenses not covered by the current fiscal year’s budget.
Income received in the current fiscal year that relates to activities or services in the next fiscal year (e.g., subscription revenue for publications to be issued in the next fiscal year). Deferred Revenue Debit appropriate cost object** and cost element then credit Internal Order 1225201 using the same cost element.

* This action should be reversed in Period 1 of the next fiscal year.

**WBS accruals are generally not made because they are cost reimbursable. Please consult with Financial Accounting and Reporting prior to doing a WBS accrual at fiscal year-end. If it is determined that a WBS accrual is appropriate, it must be processed in Period 12 and reversed in Period 1. WBS accruals are not allowed in Period 13.

Check donor restrictions as applicable

Review your restricted gift and endowment fund cost objects. Make sure you understand each donor’s restriction(s) and that the expenses associated with such funds comply with applicable restrictions.

Research and resolve outstanding issues

Research and resolve any outstanding fiscal issues as early as possible. Here are some of the most common issues:

  • Send your invoices and travel reimbursements to Accounts Payable and Travel as soon as possible to ensure posting in the current fiscal year.
  • Close out inactive internal orders by bringing the balances to zero and sending a termination request to VPF.
  • Clear out faculty-controlled cost center overruns.
  • When researching WBS elements, submit your backup as soon as possible where required for journal voucher entries.
Use Atlas tools

Whether you are new to Atlas or an experienced user, learn how to use special tools such as cloning/copying and reversing journal vouchers.

The Details

Identify key deadlines and procedures

In June, make note of key deadlines and procedures associated with closing a fiscal year. Refer to the budget closing page of this website for more information on VPF’s closing demonstration and schedule postings. Review these Year-End Close out Tips and the FY17 Closing schedule.

Pay particular attention to the various deadlines related to key categories, such as accounts payable, travel, payroll, Work Breakdown Structure (WBS) elements, cashier services, accounts receivable billing, credit card transactions, and internal provider activity.

Review guidelines for accruals and deferrals

Use this table for general guidance on accruals and deferrals at fiscal year-end closing.

Activity Type Accrual/Deferral Type Accounting Action*
Goods or services received by or provided to MIT in the current fiscal year that will not be paid until the next fiscal year (check Period 13 summary statement before accruing). Accrued Expenses Debit appropriate cost object** and cost element and then credit Internal Order 1216800 using the same cost element. In the absence of an actual invoice, use a reasonable estimate.
Goods or services provided by MIT in the current fiscal year for which payment will not be received until the next fiscal year. Accrued Income Debit appropriate cost object and cost element and then debit Internal Order 1078201 using the same cost element. In the absence of an actual bill, use a reasonable estimate.
Goods or services paid for in the current fiscal year that relate to the next fiscal year (e.g., prepaid rent or insurance). This includes invoices processed by Accounts Payable by June 30 for activities that relate to the next fiscal year. Deferred Expenses Debit appropriate cost object** and cost element then debit Internal Order 1121400 using the same cost element. DO NOT defer expenses not covered by the current fiscal year’s budget.
Income received in the current fiscal year that relates to activities or services in the next fiscal year (e.g., subscription revenue for publications to be issued in the next fiscal year). Deferred Revenue Debit appropriate cost object** and cost element then credit Internal Order 1225201 using the same cost element.

* This action should be reversed in Period 1 of the next fiscal year.

**WBS accruals are generally not made because they are cost reimbursable. Please consult with Financial Accounting and Reporting prior to doing a WBS accrual at fiscal year-end. If it is determined that a WBS accrual is appropriate, it must be processed in Period 12 and reversed in Period 1. WBS accruals are not allowed in Period 13.

Check donor restrictions as applicable

Review your restricted gift and endowment fund cost objects. Make sure you understand each donor’s restriction(s) and that the expenses associated with such funds comply with applicable restrictions.

Research and resolve outstanding issues

Research and resolve any outstanding fiscal issues as early as possible. Here are some of the most common issues:

  • Send your invoices and travel reimbursements to Accounts Payable and Travel as soon as possible to ensure posting in the current fiscal year.
  • Close out inactive internal orders by bringing the balances to zero and sending a termination request to VPF.
  • Clear out faculty-controlled cost center overruns.
  • When researching WBS elements, submit your backup as soon as possible where required for journal voucher entries.
Use Atlas tools

Whether you are new to Atlas or an experienced user, learn how to use special tools such as cloning/copying and reversing journal vouchers.

Did You Know?

Use the Recommended Revenue G/Ls to identify appropriate G/L numbers for revenue transactions.
1 of 1