Microsoft posted instructions on how to change the posting type on an account after you close the year in General Ledger at http://support.microsoft.com/kb/864913 . We felt this tip was so valuable we polished it up to make it easier for our Dynamics GP clients to use.

The posting type determines how the account balance will be treated during the year-end closing process in General Ledger in Microsoft Dynamics GP. Balance sheet accounts will be rolled forward to the next year, and Profit and Loss accounts will be rolled into the Retained Earnings account.


Cause

This problem occurs if you select the incorrect posting type for the account in the Account Maintenance window

This problem occurs if you select the incorrect posting type for the account in the Account Maintenance window when you set up the General Ledger accounts in Microsoft Dynamics GP. There are two options for Posting Type: Balance Sheet or Profit and Loss.

Resolution

Use one of the following methods to correct the posting type for the next year.

  • If the account is supposed to be a profit-and-loss account, use Method 1.
  • If the account is supposed to be a balance sheet-account, use Method 2.
Note: Before you follow the instructions in this article, make sure that you have a complete backup copy of the database that you can restore if a problem occurs.
  1. Have all users exit GP.
  2. Backup company and Dynamics databases.
  3. Review and research accounts affected.

Note: We have a customer that has an ISV product that automatically creates additional journal entries for Cash Based Accounting. They said they wanted these accounts fixed. After the correction was completed, it was found that the Cash Based Accounting ledger should not have been updated. We had to restore from the Backup and process the correction again. Therefore, it is recommended that you check to see if all accounts that will be affected by the fix need to be changed. If they do not, you may need to disable the ISV product. In this case, it was as simple as unchecking a pop-up that said it would automatically create the Cash Based accounting entry.


Method 1: The account is supposed to be a profit-and-loss account


As a balance-sheet account, this account will have a beginning balance after the year-end closing process is completed. To change the account to a profit-and-loss account and to reverse the beginning balance, follow these steps:

  1. Set the account to the “Wrong” type.
    • Click Financial>>Cards>>Account
    • In the Account Maintenance window, type the account number in the Account field.
    • Make sure that the Posting Type area is set to Balance Sheet, and then click Save.
    The type needs to be Balance Sheet type at this point so we offset the balance that was carried forward and it doesn’t affect the RE account now.
  2. Use one of the following methods, depending on whether you are registered for multicurrency or not registered:
    • If you are registered for Multicurrency Management in Microsoft Dynamics GP, follow these steps:
      • In Microsoft Dynamics GP, point to Tools on the Microsoft Dynamics GP menu, point to Setup, point to Financial, and then click Multicurrency.
      • In the Maintain History area, click to clear the General Ledger Account check box.
    • If you are not registered for Multicurrency Management, follow these steps:
      • Open SQL Server:
      • Run the following statement against the company database.
        UPDATE MC40000 SET MNSUMHST = 0
  3. Change the Maintain History settings in the General Ledger Setup window so we don’t keep the actual journal entry in the prior year, as we only want to offset the BBF that was created. To change the setting, follow these steps:
    • In Microsoft Dynamics GP, point to Tools on the Microsoft Dynamics GP menu, point to Setup, point to Financial, and then click General Ledger
    • In the Maintain History area, click to clear the Accounts check box and the Transactions check box.
    • In the Allow area, click to select the Posting to History check box. We want to be able to post an offsetting journal entry using a prior year date. Click OK.
  4. Reopen the period for the prior Fiscal Year. To do this, follow these steps.
    • Administration>>Setup>>Company>>Fiscal Periods
    • In the Fiscal Periods Setup window, make sure that the last Financial Fiscal period for the recently closed year is open. Also, make sure the first Financial Fiscal period for the new year is open.
  5. Enter a journal entry to offset the incorrect beginning balance. To do this, follow these steps:
    • Financial>>Transactions>>General
    • In the Transaction Entry window, enter a transaction that reverses the incorrect beginning balance of the profit-and-loss account.
    • In the Transaction Date field, enter a date that is in the closed fiscal year such as 12/31/201x
    For example, if the profit-and-loss account has an incorrect debit beginning balance of $100.00, create a transaction that credits the profit-and-loss account for $100.00, and then debit the retained earnings account for $100.00.
  6. Save the Transaction to a batch.
  7. Print the edit list and review. (edit if needed)
  8. Open the Financial Batch
  9. Click Post. (The General Posting Journal should show the entry listed twice. The first is for the original entry, but due to our settings, we won’t be keeping that, and the second set is for the BBF entry that will offset the balance.)
    Note: The transaction updates only the current year because the Maintain History settings are not enabled.
  10. Verify the balance on the GL account that had the issue is now $0.

Update All Settings Back to System Defaults and Correct Account Type

  1. Change the Maintain History settings in the General Ledger Setup window back to how they originally were. To do this, follow these steps:
    • In Microsoft Dynamics GP, point to Tools on the Microsoft Dynamics GP menu, point to Setup, point to Financial, and then click General Ledger.
    • In the Maintain History area, click to select the Accounts check box and the Transactions check box.
    • To post the transactions to the transaction history, click to select the Posting to History check box under Allow. If you do not want to post the transactions to the transaction history, click to clear this check box. Then, click OK.
  2. Use one of the following methods to change the Multicurrency setting back to how it originally was, depending on whether you are using multicurrency or not:
    • If you are registered for Multicurrency Management, follow these steps:
      • In Microsoft Dynamics GP, on the Microsoft Dynamics GP menu, point to Tools, point to Setup, point to Financial, and then click Multicurrency.
      • In the Maintain History area, click to select the General Ledger Account check box.
    • If you are not registered for Multicurrency Management, follow these steps:
      • Open SQL Server:
      • If you are using Microsoft SQL Server 2012, click Start, point to All Programs, point to Microsoft SQL Server 2012, and then click SQL Server Management Studio.
      • Run the following statement against the company database
        UPDATE MC40000 SET MNSUMHST = 1
  3. Go back to the Fiscal Period setup and mark to close the Fiscal Period for the prior year again.
  4. Do a final verification to confirm that the balance on the GL account is $0.00 and then you can change the type on the account to Profit and Loss. To do this, on the Cards menu, point to Financial, and then click Account. In the Account Maintenance window, type the account number in the Account field. In the Posting Type area, click Profit and Loss, and then click Save.

Method 2: The account is supposed to be a balance-sheet account


As a profit-and-loss account, this account will not have a beginning balance after the year-end closing process is completed. To change the account to a balance-sheet account and to create the beginning balance, follow these steps:

  1. On the Cards menu, point to Financial, and then click Account. In the Account Maintenance window, type the account number in the Account field. In the Posting Type area, click Balance Sheet, and then click Save. Select Balance Sheet so that the correcting entry that you make in step 6 later in this section will correctly update the beginning balance for the current year.
  2. Use one of the following methods, depending on whether you are registered for multicurrency or not registered:
    • If you are registered for Multicurrency Management in Microsoft Dynamics GP, follow these steps:
      • In Microsoft Dynamics GP, point to Tools on the Microsoft Dynamics GP menu, point to Setup, point to Financial, and then click Multicurrency.
      • In the Maintain History area, click to clear the General Ledger Account check box.
    • If you are not registered for Multicurrency Management, follow these steps:
      • Open SQL Server:
      • Run the following statement against the company database.
        UPDATE MC40000 SET MNSUMHST = 0
  3. Change the Maintain History settings in the General Ledger Setup window so we don’t keep the actual journal entry in the prior year, as we only want to offset the BBF that was created. To change the setting, follow these steps:
    • In Microsoft Dynamics GP, point to Tools on the Microsoft Dynamics GP menu, point to Setup, point to Financial, and then click General Ledger
    • In the Maintain History area, click to clear the Accounts check box and the Transactions check box.
    • In the Allow area, click to select the Posting to History check box. We want to be able to post an offsetting journal entry using a prior year date. Click OK.
  4. Reopen the period for the prior Fiscal Year. To do this, follow these steps.
    • Administration>>Setup>>Company>>Fiscal Periods
    • In the Fiscal Periods Setup window, make sure that the last Financial Fiscal period for the recently closed year is open. Also, make sure the first Financial Fiscal period for the new year is open.
  5. Enter a journal entry to offset the incorrect beginning balance. To do this, follow these steps:
    • Financial>>Transactions>>General
    • In the Transaction Entry window, enter a transaction that reverses the incorrect beginning balance of the profit-and-loss account.
    • In the Transaction Date field, enter a date that is in the closed fiscal year such as 12/31/201x.
    For example, if the balance sheet account should have a debit beginning balance of $100.00, create a transaction that credits the retained earnings account for $100.00 and that debits the balance sheet account for $100.00.
  6. Save the Transaction to a batch.
  7. Print the edit list and review. (edit if needed)
  8. Open the Financial Batch
  9. Click Post. (The General Posting Journal should show the entry listed twice. The first is for the original entry, but due to our settings, we won’t be keeping that, and the second set is for the BBF entry.)
    Note: The transaction updates only the current year because the Maintain History settings are not enabled.
  10. Verify the balance on the GL account that had the issue is no longer $0.

Update All Settings Back to System Defaults and Correct Account Type

  1. Change the Maintain History settings in the General Ledger Setup window back to how they originally were. To do this, follow these steps:
    • In Microsoft Dynamics GP, point to Tools on the Microsoft Dynamics GP menu, point to Setup, point to Financial, and then click General Ledger.
    • In the Maintain History area, click to select the Accounts check box and the Transactions check box.
    • To post the transactions to the transaction history, click to select the Posting to History check box under Allow. If you do not want to post the transactions to the transaction history, click to clear this check box. Then, click OK.
  2. Use one of the following methods to change the Multicurrency setting back to how it originally was, depending on whether you are using multicurrency or not:
    • If you are registered for Multicurrency Management, follow these steps:
      • In Microsoft Dynamics GP, on the Microsoft Dynamics GP menu, point to Tools, point to Setup, point to Financial, and then click Multicurrency.
      • In the Maintain History area, click to select the General Ledger Account check box.
    • If you are not registered for Multicurrency Management, follow these steps:
      • Open SQL Server:
      • If you are using Microsoft SQL Server 2012, click Start, point to All Programs, point to Microsoft SQL Server 2012, and then click SQL Server Management Studio.
      • Run the following statement against the company database.
        UPDATE MC40000 SET MNSUMHST = 1
  3. Go back to the Fiscal Period setup and mark to close the Fiscal Period for the prior year again.
  4. Do a final verification to confirm that the balance on the GL account is no longer $0.00 and then you can change the type on the account to Profit and Loss. To do this, on the Cards menu, point to Financial, and then click Account. In the Account Maintenance window, type the account number in the Account field. In the Posting Type area, click Profit and Loss, and then click Save.

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For personalized Microsoft Dynamics GP support and training contact CAL Business Solutions. 860-485-0910 x4 or sales@calszone.com.

By CAL Business Solutions, Connecticut Microsoft Dynamics GP Partner, www.calszone.com