Accounting Cycle Overview
This document walks through the full accounting lifecycle in Lilury — from setting up a financial year to closing it out and opening the next one.Financial years and periods
Everything in Lilury’s accounting module is anchored to a financial year. A financial year defines the date range your books cover — commonly January–December, but it can start on any month depending on your organisation’s fiscal calendar. When you create a financial year, Lilury automatically generates accounting periods within it. By default these are monthly (12 periods per year), but the exact breakdown is determined by the configuration you supply. Each period has:- A sequential number (e.g. Period 1, Period 2 … Period 12)
- A start date and end date
- A status — open, locked, or closed
Journal entries
A journal entry is the core unit of accounting in Lilury. It records a financial event as one or more debit/credit lines that must balance to zero.Statuses
| Status | Meaning |
|---|---|
| Draft | The entry has been saved but not yet posted. It has no effect on balances or reports. You can edit or void a draft freely. |
| Posted | The entry has been committed to the ledger. It affects balances and appears in financial reports. Financial data (amounts, accounts, dates) cannot be changed, but non-financial metadata can be updated. |
| Void | A draft entry that has been cancelled before posting. It is removed from the active ledger but remains in the audit trail. |
| Reversed | A posted entry that has been corrected. Lilury creates an automatic counter-entry that zeroes out the original. Both the original and the reversing entry remain in the audit trail. |
Voiding vs. reversals
- Void applies only to draft entries. It cancels the entry before it ever reaches the ledger — no financial impact has occurred, so no counter-entry is needed.
- Reversal applies only to posted entries. Because the entry has already affected balances, Lilury creates a mirror entry with debits and credits swapped to neutralise the effect. You can then post a corrected entry.
Editing posted entries
A posted entry’s financial data — line amounts, account codes, dates, currency — is immutable because changing it would silently alter reported figures. You can, however, update non-financial metadata (such as description, reference, or tags) on a posted entry without affecting any balances or reports.Posting rules
- You can only post a journal entry into a period that is currently open.
- To correct a posted entry, reverse it and post a new one.
- You can reverse a posted entry from a locked or closed period, but the reversing entry must be posted into a currently open period.
Period locking, reopening, and closing
Periods move through a lifecycle to prevent accidental changes to finalised data.Open
The default state. Journal entries can be created, edited (if still in draft), posted, and voided freely within an open period.Locked
Locking a period prevents any new journal entries from being posted into it. Existing posted entries remain intact. Locking is a lightweight control — useful during month-end review when you want to stop new postings while reconciliation is still in progress. A locked period can be reopened (returned to Open) if you discover an error that must be corrected before formal closure.Closed
Closing a period is a permanent, irreversible action. No entries can be posted into a closed period, and it cannot be reopened. Close a period only once all reconciliation and review is complete and signed off.Month-end (period-end) closure
Lilury gives you two controls to finalise a period’s books: locking and closing. Locking stops any new journal entries from being posted into the period. This is useful once you want to freeze postings while review is in progress. A locked period can be reopened at any time if a correction is needed. Closing permanently seals the period. It cannot be reopened after closing. Lilury does not enforce any prerequisites before you close a period — drafts may still exist, and reconciliation is outside the system. Closing is simply an irreversible signal that the period is finalised.Year-end closure
When all periods of a financial year have been closed, you can perform the financial year-end closure. Lilury enforces two prerequisites before allowing this:- Temporary accounts must be zeroed — all income and expense account balances for the year must be zero before closure is permitted. These accounts are typically zeroed by posting a closing entry that transfers the net profit or loss to retained earnings (or the equivalent equity account). Lilury can automatically generate this closing journal as a draft, which you can then review and post.
- A next open financial year must exist — Lilury requires that a new financial year has already been created and is open before the current year can be closed. This ensures there is always an open period available to receive new entries.