Overview
Closing the books is the process that occurs at the very end of the accounting cycle. In this period, the journal for the period is finalized and closed. The balance in the Revenues and Expense accounts are moved the Equity Account, so that Revenues and Expenses for the next period are reset to zero.
Closing the books usually occurs on an annual basis. That is, the quarterly revenue and income accounts will accumulate until the end of the annual period, at which point they are moved into equity and closed.
The preparation of financial statements typically occurs at the end of each quarter. That is, preparation does not require that the books are closed. In fact, even at the end of the year, the financial statements are prepared prior to closing.