At the end of a financial reporting period, Clear Books will run an automated process to update the Historic retained earnings of the new financial reporting period.


This process calculates the sum of the Historic retained earnings, the total Cumulative profit/loss and Dividends balances to give the Historic retained earnings balance of the new financial reporting period.


In this example below, the balance sheet shows 0 for Historic retained earnings, 2,995 for the total Cumulative profit/loss and -200 for Dividends.



The combined balance would be 2,795 and this will be reflected in the balance sheet for Historic retained earnings of the new financial year.



This movement is not created as a transaction in the Historic retained earnings account. This movement will also update automatically if you add in transactions after the financial reporting period ends.


Please note that if you create transactions in Clear Books that debit or credit retained earnings, the retained earnings Transactions report will only show the balances of the transactions you have created and not the end of year movement. However, any transactions that you do make to debit or credit retained earnings, the Historic retained earnings will reflect this on the balance sheet.


It is important to make sure your financial reporting periods are setup correctly, you can learn more about this by clicking here. You can also learn how to lock your financial reporting periods, to prevent transactions from being entered, by clicking here.



For additional help, click here to view all our training options.


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