Year-End ERP Checklist for Dynamics Business Central

November 25, 2025

Year-end puts extra pressure on your finance team. Schedules tighten. Reports pile up. Every transaction needs to land in the right place.

Business Central can handle the load when the setup is clean and the close is intentional. Reviewing posting rules, validating accounts and lining up your periods now saves time when it matters most.

This guide walks through the key areas to review before you wrap up the fiscal year, the full year-end sequence inside Business Central, and how HBS supports every step.

The Year-End Process in Business Central

Your complete year-end sequence includes nine major steps.

1. 1. Preparation: Process 1099s
  2. Prepare Key Reports
  3. Close the Current Fiscal Year
  4. Create a New Fiscal Year
  5. Close the Income Statement
  6. Run the Trial Balance and Adjust Entries
  7. Audit Entries
  8. Re-Close
  9. Print the Trial Balances and Reports

1. Preparation: Process 1099s

Enable the 1099 feature, review vendor setups and run a test report to confirm accuracy.
Adjust vendor ledger entries as needed.
Submit electronically or use pre-printed forms.

2. Prepare Key Reports

Start with the Chart of Accounts.
Add a column to the right called “Income Statement and Balance Sheet”
Confirm account classifications.

Then verify control accounts and check for mismatches between sub-ledgers and the GL.
Fix posting group issues, turn off Direct Posting and reconcile using Excel.

This is where most delays begin!
Here are some helpful tips to keep you from getting tripped up.
Verify the Chart of Accounts
Start by reviewing your Chart of Accounts.
Add the Income Statement/Balance Sheet column and confirm account classifications.
Mislabeling results in retained earnings adjustments and messy audit trails.
Verify Control Accounts
Check that AP, AR, Inventory, and Fixed Assets match their sub-ledgers.
Turn Direct Posting off for all control accounts to avoid mismatches caused by manual entries.
Resolve Sub-Ledger and GL Differences
Common problem areas:
Direct posting enabled
Initial implementation entries not aligned
Incorrect posting group setup
Use Excel (MATCH, VLOOKUP, filters) to reconcile month by month and separate material from non-material discrepancies.

3. Close the Current Fiscal Year

Search for Accounting Periods.

Select Close Year.

Verify the date range before finalizing—this cannot be reopened.

Best practice: test this in a sandbox first to confirm retained earnings and forward balances behave correctly.

4. Create a New Fiscal Year

From Accounting Periods, choose Create Year.
Enter the start date and period length (such as 1M for monthly periods).

Confirm new periods display correctly.

You can still post auditor adjustments into closed years.

5. Close the Income Statement

Search for Close Income Statement.

You’ll need to choose:

- Fiscal year ending date
- Journal template (GENERAL works well)
- A dedicated year-end journal batch
- Correct retained earnings account
Whether to post Balance (summary) or Details (line-level)

- Posting Description (“Close Income Statement”)
- Whether to close by Business Unit Code (intercompany transactions or multiple companies) or by Dimensions Run (detailed tracking and reporting capabilities)

6. Run the Trial Balance & Adjust Entries

Run the trial balance to make sure income statement accounts zero out and balance sheet accounts carry forward correctly.
We recommend copying the company into a sandbox environment to test the closing process and ensure accuracy. Reversing entries can be messy, so it’s important to get it right the first time.
Enter adjusting entries.
Re-run the trial balance to confirm accuracy.

7. Audit Entries

Post year-end adjustments.
If adjustments affect income statement accounts, re-run the Close Income Statement process to include them.

8. Re-Close

Only newly created adjustments are included when you re-close. This step ensures nothing is missed.

9. Print Trial Balances and Reports

Print final versions of the trial balances, financial statements, aging reports, fixed asset details and inventory valuation.

Then update Allow Posting From/To at both the system and user level to prevent entries into the prior year.

HBS Helps Business Central Users Close Confidently

Year-end is smoother when you have a partner who knows Business Central inside and out.

The HBS ERP team supports you through:

Cleanup and posting setup review
1099 prep and year-end forms
Validating year-end close steps
Addressing errors before they affect reporting
Planning the next fiscal year
Reviewing how Business Central aligns to long-term financial strategy

A smooth year-end starts with a strong plan. We’ll help you close cleanly and begin the next fiscal year with confidence.