You do not have to do year end routine on the first day of the new year- you just can't post any transactions for 2008 until you do.  We typically wait until the majority of past year transactions are done- ie inventory, work orders, AR and AP, because once the year end is done  each transaction for the past year does an additional transaction to adjust retained earnings.  We like to keep these to a minimum.  After about a week  we usually are needing to post to 2008, so we do the year end routine.

Let's set the record straight.  AM-B does not CLOSE anything.  It simply rolls balances forward and opens the new year.  You can continue to post to the prior year for as long as it takes to wrap things up.  And even if you haven't run AM-B yet, no day to day processing is impacted other than GL-O Posting (because it needs to know the new year period dates before posting can occur.)  
 
Once you do have the majority of entries made for the prior year, you can use AM-A to set the close date to prevent any type of entry to the prior period.  When the inevitable adjusting, depreciation, and other entries are required, simply use AM-A to open the prior period be setting the close date back, make the entries, then set the close date again to prevent other entries.
 
Any entries made to an income or expense account for a prior period (up to 6 years past if the Close Date allows it) will atomatically make an entry closing out the account to Retained Earnings.

I am now a little confused...Lynn said that AM-B doesn't close anything, but David and Imk223a both say you need to reopen December to post anything to December.  I need to see January activity in the GL and I also need to do some serious work to close out the year.  I really can't see changing the closing date any time I need to do something in December.  
 
Lynn, could you please clarify this?  Am I correct in assuming that processing AM-B does not require opening and closing December to complete year-end transactions as well as see what is happening in January GL?
 
Thanks,
 
Rich

I wasn't talking about AM-A at all. But since we are now, our default is to have two months "open" via AM-A. That is, right now AM-A is set to Nov 30. At the end of January I will change it to Dec 31. As we are finalizing our tax return we may temporarily need to re-set it to go back even further. Once our tax return has been filed I will make a copy of our company called "Final 2007" with a company code of "07" for archival purposes, and never make another entry before 1/1/08. However, I could theoretically go back as far as 2002 and make entries if I wanted to. Of course then I would probably have to file an amended return as well...

Quote from Lynn_Pantic on 01/08/08 at 08:24:27:

 
And that's what I want. I always use the last day of the month, because that's the date I use for "month" type things, like depreciation, adjustments, accruals, etc. Using the last day rather than the first day limits the possibility of someone accidentally entering a transaction to the wrong month to only that one day.

We have seen some pretty crazy stuff in the past when posting to the GL for the past year-- which is why we try to wait until there is a minimum of activity left before doing the year end routine.
One thing we pinpointed but could not necessarily repeat was errors when we posted more than one "TYPE" of transaction at a time-- now we are very paranoid and not only post just one type at at time but also exit out of GL-P in between types, and definitely do not post a date range that includes old and new year.