You can choose whether to close your books at the end of the year or
not. QuickBooks doesn't require you to do so.
Restricted access: You can set a password to restrict access to data from the prior accounting period, including the details of every transaction. Transactions can't be changed without your knowledge. To modify or delete a transaction in a closed period, a user must know the closing date password and have the appropriate permissions.
Detail: You always have easy access to last year's data, including the details of every transaction.
Reporting: You can create comparative reports between this year and last year.
QuickBooks performs certain year-end adjustments, based on your fiscal year
QuickBooks adjusts your income and expense accounts at year-end to zero them
out. Therefore, you start your new fiscal year with a zero net income.
QuickBooks makes an adjusting entry to your net income. For example, if your
profit for the year was $12,000, on the last day of your fiscal year the equity
section of your Balance Sheet would show a line for net income of $12,000.
On the first day of the new fiscal year, QuickBooks increases your Retained
Earnings equity account by the previous year's net income ($12,000 in this
example) and decreases your net income by the same amount. This way, you start
each new fiscal year with a net income of zero.
Set a closing date and closing date password
Track retained earnings