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How PMCs Execute a Clean Year-End Close and Start the New Financial Year Correctly

Who this is for

Your property management company is approaching its financial year-end. In past years, the year-end close has been informal: the accountant makes a few adjusting entries, the financial statements are produced, and the new year begins — but carry-forward balances were never properly confirmed, and the opening trial balance of the new year has unexplained differences from the prior year's closing balance.

The problem

Year-end close is a formal accounting process: all income and expense accounts are zeroed out into retained earnings, the balance sheet accounts (assets, liabilities, equity) carry forward, and the new year begins with a clean starting point. Done wrong, the new year's books are built on a faulty foundation. The retained earnings are incorrect, prior year comparatives don't match, and the accountant spends months in the new year cleaning up problems that trace back to the year-end close.

For property companies, there's an additional complication: deposits held, AR outstanding, and AP payable all need to be confirmed as at year-end. If any of these are misstated, the balance sheet carried into the new year is wrong from the start — and a wrong opening balance sheet means every subsequent report is unreliable.

What you can achieve

  • Year-end close executed formally with a closing journal — income and expense accounts correctly zeroed
  • Balance sheet balances carry forward automatically — no manual entry of opening balances in the new year
  • Opening trial balance of new year verified to match prior year closing — no mystery differences
  • Prior year financials locked and available for comparison — multi-year comparative reporting enabled
  • Year-end close documented and timestamped — auditors see a formal close, not an ad-hoc adjustment
  • New financial year begins with a clean, verified set of books — no accumulated errors from prior years

The Kokodi workflow

  1. Step 1

    Confirm fiscal year end date

    Setup

    Verify the fiscal year is correctly defined in Kokodi. All transactions in the period are accounted for — including any adjusting entries for accruals or prepayments.

  2. Step 2

    Run trial balance at year-end

    Report

    Generate the Trial Balance as at the last day of the fiscal year. Debits and credits agree. Review all account balances for anomalies before closing.

  3. Step 3

    Post year-end adjusting journals

    Action

    Enter any required adjusting journals: depreciation, accrued expenses, prepaid income. Each journal goes through the approval workflow before posting.

  4. Step 4

    Execute year-end close

    Action

    Use the Year-End Close module to formally close the fiscal year. Kokodi posts the closing journal: all income and expense accounts zero to retained earnings. The year is locked.

  5. Step 5

    Set up new fiscal year

    Setup

    Create the new fiscal year in Kokodi. Balance sheet balances carry forward automatically as opening balances — assets, liabilities, deposits, AR, and AP.

  6. Step 6

    Verify opening trial balance

    Report

    Run the Trial Balance as at the first day of the new year. Confirm it matches the prior year closing balance sheet exactly — a clean, verified hand-off.

  7. Step 7

    Prior year financials locked and available

    Report

    Prior year P&L, Balance Sheet, and Cash Flow are locked in Kokodi — available for comparison at any point in the new year. Comparative reporting enabled.

Kokodi features used

Fiscal Year ManagementTrial BalanceYear-End Close ModuleOpening BalancesGL EngineJournal Approval WorkflowP&L StatementBalance Sheet

Ready to set this up for your portfolio?

Talk to the Kokodi team and get a personalised walkthrough of this exact workflow for your buildings.

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