Closing the Payroll Year

Answers to some of the most common questions related to closing the payroll year.

I have received a software update, but haven't installed it yet. How will this affect year-end processing?

Please install the year-end (R3) version of Spectrum before performing year-end processing.

When should I close 2023 payroll?

Plan to perform the year-end tasks any time after you complete your last payroll cheque dated 2023 and before you issue any cheques dated 2024. The Spectrum application does not require you to do these steps on December 31st.

What does the Year End Update function do? What effect does it have on my permanent payroll records in Spectrum?

The Year End Update resets all employees' year-to-date balances to zero.

If the Deduction/Add-on Code flag is set to clear at year-end, the Year End Update also sets the accumulated balance in the recurring deduction file to zero.

The Year End Update does not remove any historical employee data.

I want to delete (purge) terminated employees. How do I do this?

An employee may be purged by using the Delete Employee from Current Company screen in Payroll > Utilities.

My fiscal year is different than the calendar year. Is there anything special I should know?

Because payroll is based on the calendar year, you will need to perform the Year End Update in the Payroll module, even if you maintain the rest of Spectrum on a fiscal year basis. Run the Payroll Year End Update only at the end of each calendar year, and not timed with the end of your fiscal year.

My fiscal year-end is December 31st. Is there anything special I should know?

Spectrum provides an unlimited Fiscal Calendar in the General Ledger module. To add new years or historical years to this calendar, see the General Ledger Help.

One of my employees changed their name. Should I set up a new employee code as part of year-end?

No. Spectrum populates employees' names on T4 Slips based on the field values in Employee Main Properties. No additional year-end-related changes are needed.

To change employee code (not only at year-end):
Note: It's important that no one is using Spectrum while this step is being performed - both to speed the process and ensure all records are updated properly.
  1. Go to Payroll > Utilities > Change Employee Code.
  2. Select New.
  3. In the Old employee code field, enter the employee's previous employee code, or use the drop-down to search and select an employee code.
  4. In the New employee code field, enter the employee's new employee code.
  5. Select OK.
  6. Print the Employee Code Change Listing to confirm the entries.
  7. Select the Update button.
  8. Read the text in the Code Change Window and select OK to proceed.
  9. On the Employee Code Change Update screen, select the Continue option and select OK.

This update changes the Maintenance screens, as well as all of the history files for this individual.

I'm trying to reconcile my Payroll liabilities in General Ledger, but there are no January beginning balances. What's wrong?

If December 31st is your fiscal year-end, it means the G/L Opening Forward Balance Update has not yet been performed.

This important update sets the beginning balances and retained earnings for the new year, and should be performed each time you post additional amounts into the prior year. The Equipment Control and Materials Management modules also have Opening Forward Balance Updates that should be run before year-end and re-run each time you post additional amounts into the prior year.

If the Opening Forward Balance Update has been performed, verify the account type in the G/L master file for the Payroll Liabilities is set to Liability. If an incorrect account type is found, change the type to Liability, and then re-run the Opening Forward Balance Update to set the beginning balance.

Even though I have closed payroll and am now doing 2024 activity, I haven't closed other modules yet. Is that a problem?

CAUTION: Once Payroll has been closed at year-end, do not attempt to record more prior-year activity in payroll. Doing so will corrupt the new year-to-date totals, and taxes will be incorrectly calculated. If prior year entries do need to be made, we've included a special troubleshooting section in this guide that addresses this problem.

For other modules, you can continue to record prior year transactions for as long as you need. It's common for A/P invoices and other transactions show up for some time after the year has ended. As each module is closed, set the minimum processing date to fall in the new year and move on to the next module.

Are there any year-end steps I should plan to do for other modules?

If the Human Resources module is installed, use the Time Off Management screen to revise vacation/holiday/sick account balances.

For information on year-end procedures in other modules, see Non-Payroll Year-end Processing (Canada).

What are the important dates I need to know for filing?

Please refer to the CRA website for filing deadlines for paper and electronic filing.