The net profit for the year is the positive balance of income and expenses for a financial year. It represents the financial result that remains after all business transactions and postings have been finalised.
Detailed explanation/description:
In SAP Business One, the net income for the year is recognised in the Profit and loss account (P&L) is shown. This shows the balances of all income and expense accounts for a selected period. The net profit for the year is therefore the central result of the income statement and forms the basis for the Period-end closing and the annual financial statements.
Integration into business processes:
Net profit influences the balance sheet, equity development and business decisions. It is a key accounting result and is used for external reporting, internal analyses and tax purposes.
Relevant modules and functions:
- Profit and loss account (P&L)
- Period-end closing
- Journal entries and recurring bookings
- Cost centre and project accounting
Concrete application examples:
- At the end of the year, the net profit for the period is automatically transferred to an equity account.
- A company compares the P&L reports of the last three years in order to recognise trends in the annual result.
- The net profit for the year serves as the basis for the dividend decision by the management.
Key features/important aspects:
- Derived from the income statement
- Automatic posting through period-end closing
- Can be corrected by adjusting entries
- Takes into account all business transactions recognised in profit or loss
Versino Financial Suite
- Clearer transparency of earnings performance.
- Better traceability of transfers in the closing process.
- Comprehensive analysis functions for internal management and external reporting.
- Secure integration in auditing and final accounting.
Target group:
Financial accountant, controller, management, tax consultant