I have been asked by a client about the usefulness about closing periods. Usually, we create 12 periods and 1 closing period but… Is there any impact if we do not create that period? What would we be losing in that case? When should this period be closed if created?
Thanks in advance 
A closing period is used so that the company can close the 12th period but use the 13th for the “unexpected” postings. This way, they do not have to leave the 12th period open and risk posting to the prior year. If the 12th period is left open, a user could accidentally back date something into the prior year. Users cannot post to the 13th period, it is only for accounting. Some CFOs halt transactions at month end until they are happy with the numbers, at year end that is more difficult and therefore the 13th period becomes a benefit.
Appreciate your help John!