Can the Financial Year-End Processing (FYEP) occur automatically whenever a new entry is made in previous years?

Financial year-end processing ensures that all financial transactions from a given fiscal year are properly recorded, reconciled, and closed before transitioning to the next year. However, one common question that arises is whether this process happens automatically when a new entry is made in the previous year's accounting data.

The simple answer is no—financial year-end processing does not happen automatically when a new entry is added to the previous year’s financial records. Each time a new transaction is recorded in the past financial year, the year-end process must be manually re-executed to reflect the updated figures in reports and balances.