The Balancing Act

Gregory Bingel — Wed, 06 May 2009 11:21:00 GMT

The ending balance on the Trial Balance does not match the Balance Sheet. What is going on here? Have any of you ever experienced this frustration? I’m sure you have. There is a valid explanation for this discrepancy: mock close. As a refresher, mock close is the term used to refer to the rollover of the net surplus/deficit for the year into the fund balance account for reporting purposes only. In essence, the mock close allows us to see our retained earnings as of the report date.

Both reports mock close differently, which causes the ending balances not to match. Let me explain. The Balance Sheet mock closes both the prior year's net surplus/deficit and the current year's net surplus/deficit as of the report date, where the Trial Balance mock closes only the prior year's net surplus/deficit. So when you run the two reports, the ending net asset balance on the Trial Balance should match the difference between the total net assets and net surplus deficit on the Balance Sheet. This value is called the 'beginning balance with current year adjustments'.

I hope this information helps when reconciling!

What's a Mock Close?

Gregory Bingel — Tue, 21 Apr 2009 12:03:00 GMT

Mock Close, Mock Close, what does this mean and how does it affect me? This term is actually very important and pertains to the way the Balance Sheet, Income Statement, and some other reports reflect ending account balances.

So what is a mock close? Mock close is the term used to refer to the rollover of the net surplus/deficit for the year into the fund balance for reporting purposes only. Now I know you are scratching your head trying to figure out what this means so I will now break this concept down into simpler terms.

The software “pretends” that all revenue has rolled into the net asset accounts on the fund record and all the expenses have rolled out of the accounts as of the report dates. In essence, the mock close allows us to see our retained earnings as of the report date. However, the actual rollover process does not physically take place until the fiscal year is hard closed. In short, the mock close is a reporting event only and no journal entries are created.

If you’re thirsty for more mock closing detail try rehydrating yourself by looking over BB22412, which also includes a list of reports that perform this function.

I hope this information helps.

The Ledger : mock close

The Balancing Act

What's a Mock Close?