General Fund Closing Entries

If you only read one thing Year-end closing wipes out both the budgetary accounts and the operating accounts, so next year starts clean and Fund Balance reflects what actually happened.

Builds on FM3.6 Budgetary accounts close at year-end, the same way operating accounts do, reversing the original budget entry.

Why This Matters

This is the step that turns a year’s worth of entries into the numbers that actually show up on the financial statements in FM4.3.

What’s Actually Going On

Two separate closing entries happen. The budgetary accounts, Estimated Revenues and Appropriations, close against each other and Budgetary Fund Balance, reversing what was recorded when the budget was adopted. The operating accounts, Revenues, Expenditures, Other Financing Sources and Uses, close against Fund Balance, capturing the actual results of the year.

Two closings, two different targets, both happening the same night.

How This Applies

If Fund Balance moved by an amount that doesn’t match what you expected from operations alone, check whether the budgetary close is bleeding into your read of it, they’re separate entries, but easy to mentally merge if you’re not watching for it.