Setting your Lock Dates and why you should use them

When you come to the end of your financial year and are due to hand your accounts data over to your accountant, you may wonder what is the best way to assist them in their work. One particularly useful setting available, which will ensure that this “snapshot” provided does not change, is the lock dates function on your bookkeeping software.

You’d be surprised how much time can be spent searching for a difference in the prior year’s figures cause by a back-posting. By setting a lock date once your accountant starts working on the accounts, you will avoid this possibility. Most softwares offer this function, including some of the more well-known names such as Sage, Xero and QuickBooks. If you’ve not heard of this feature before, all it does is ensure that there can be no more transactions posted into your software dated before a date specified by you.

For example, let us say that your year end is July 2017, all your invoices have been entered, the bank reconciles, and your accountant starts working on the accounts. Then, you receive a late invoice from your supplier dated July 2017, and post it on the system. When July 2018 comes around and your 2018 accounts are being done, your accountants will be scratching their heads wondering why your brought forward profit for 2017 has changed from that showing in your 2017 accounts, and may spend unnecessary time hunting down the July 2017 invoice that was posted late.

Setting the lock date is easy, if you’re a Sage, Xero or QuickBooks Online user. Here’s how:

  • If you’re on Xero, and we process your bookkeeping, we will do this for you. If you process your own bookkeeping, then please follow the link for further details.
  • If you use Sage, then go to Tools > Period End, and it’s a choice between Month End and Year End. Select the appropriate option for you. If you prepare management accounts then the Month End option will prove very useful, if not, then run the Year End option at the end of your financial year after the backup has been extracted for your accountant.
  • If you use QuickBooks Online, and are a Company Administrator or have access rights to edit company information, then click on the cog and go to Accounts and Settings > Advanced > Close the books and enter in your lock date. You also get the option to either allow people to continue to make postings after the lock date after giving them a warning, or have people enter a password to allow them to make changes.

If you have any queries on setting lock dates or closing a period on your accounting software, then please get in touch with your contact at Barnes Roffe.


Blog written by: Phoebe Arnull

Talk to Barnes Roffe today
Share this page:
Contact Us
ICAEW The Chartered Institute of Taxation ACCA IPG IR