What is Period lock / closing date?

Once a month or year has been reconciled, reviewed and reported, its numbers should stop moving. A period lock (also called a closing date or lock date) enforces that: transactions dated on or before the lock cannot be created, edited or deleted. Without one, a late correction to a December invoice can quietly change a year-end balance sheet that has already gone to the accountant, the bank or the CRA.

Locks are usually applied in stages. The bookkeeper closes a month after the bank reconciliation, sales tax filing and review of payables and receivables. At year-end, the accountant posts adjusting entries and the year is locked once financial statements and the T2 return are final. Some systems allow a password or permission override for genuine corrections, and that override should be recorded in the audit trail.

When something is found after a period is locked, the right fix is usually an adjusting entry in the current open period rather than unlocking and rewriting history. That keeps the original record intact and makes the change easy to explain. Period locks pair naturally with role-based permissions and an append-only audit log, which together give owners and accountants confidence that the numbers they signed off on still hold.