Period closing is a concept used by accountants to ensure that audited and known-correct accounting data stays correct by “freezing” it: by closing an accounting period no modifications can be made to the accounting data before a certain date.
LedgerSMB supports this concept through the System Audit Control menu, where you’ll find the “Close Books up to” item. By filling out a date in the input field and hitting Continue posting to dates before the entered date will be disallowed.
Note that due to a design limitation in LedgerSMB 1.3 - to be lifted with the general AR/AP redesign - invoices in foreign currencies can’t be reversed on other dates than their original posting date. That is: they can, but their reversal will result in P&L and balance sheet effects which presumably isn’t desirable. Since period closing disables posting before a certain date this functionality may have negative side effects in some set ups.
Also note that this pertains exclusively to invoices and transactions in foreign currencies and has no effect in case of invoices and transactions in the default currency.