📍 Where can I find this module?
Main menu > Finance > Fiscal years
Introduction #
The Accounting Periods module allows you to define your company's accounting periods. Each accounting period covers a specific timeframe (usually 12 months) during which accounting entries are recorded. It can be accessed via Finance > Fiscal Years.
The fiscal year is a fundamental element of accounting: it determines the period over which financial statements are prepared and governs the creation of journal entries.
1. Create a fiscal year #
Click on Add an exercise from the module list.
Information to provide:
- Name: the fiscal year designation (e.g., “Fiscal Year 2025”)
- Start date: the first day of the fiscal year
- End date: the last day of the fiscal year
- Status: Fiscal year status (active or closed)
- Exchange rates for accounting: the type of exchange rate used for entries in foreign currency
- Exchange rate for inventory valuation: the rate used to value inventory at the end of the fiscal year
Important: Only one fiscal year can be active at a time. Be sure to close the previous fiscal year before activating the next one.
2. The Life Cycle of an Exercise #
| Status | Description |
|---|---|
| Asset | The current fiscal year. Accounting entries are recorded in this fiscal year |
| Closed | The fiscal year has ended. No new entries can be added. |
Important: If you post a document with a date that corresponds to a closed or non-existent fiscal year, Kafinea will notify you that no journal entry will be generated. You can choose to continue or cancel the posting.
3. Cash-based accounting #
Each fiscal year has an option Cash Basis Accounting that allows you to switch between two accounting modes:
- Accrual accounting (default): entries are recorded on the date of the transaction ( invoice issuance)
- Cash-based accounting: entries are recorded on the date the cash is actually received or disbursed
For more details, see the Cash Basis Accounting page.
4. Frequently Asked Questions #
Does my fiscal year have to correspond to the calendar year?
No, a fiscal year can begin and end on any date. Some companies have fiscal years that do not align with the calendar year (e.g., April 1 to March 31). The standard duration is 12 months, but the first fiscal year may be shorter or longer.
What happens if I forget to create a fiscal year?
Documents will be saved as usual, but no journal entries will be generated for dates not covered by an active fiscal year. Kafinea displays a warning in this case.
Can I reopen a closed fiscal year?
Technically, the status can be changed. However, reopening a closed fiscal year should be done only in exceptional circumstances and with caution, as it may affect financial statements that have already been generated.