General Ledger automatically posts the net balance of all 
income and expense 
accounts from the prior year to the retained earnings 
account when you open 
the first period of the fiscal year. GL will automatically 
update the 
retained earnings as needed, when you post journal entries 
to the prior
year.

When we close last Finacial period (Soft/Hard close),system 
automatically transfer the difference of Income and expense 
accounts to the retained earning account which is 
considered as the asset for the next financial period which 
in turn get distributed to different account in next period.
This Retained earning account is mentioned at the time of 
creating a Set of Book(SOB).This Retained earning account 
is also called as Profit and Loss account(P&L).
At the time of closing financial period other account types 
like asset and liabilities are carried forward to next 
financial period.
Cash in Hand is an asset account.