Prepare Your Business for Year-end
Is there a time busier than the end of the year? Most Accountants will say tax time; however, preparing your business for taxes means closing out your financial reports for year-end. Aside from the Christmas List, there is another list you should make and check twice.
Here is a checklist to help you manage your business tasks and close your books properly. You can set yourself up for a happy New Year by taking these steps.
1. Financial Reports
Keeping thorough financial records is a non-negotiable for any business. With accurate and clean books, you can better understand your business performance for the current year and plan for the year ahead.
This is a time to evaluate your position compared to previous years. By analyzing your Income Statement, Balance Sheet, and Statement of Cash Flows, you are more equipt to make critical financial decisions based on your analysis.
Seak a trusted accountant who can clarify what you see in your financial reports. They will also advise you on things such as making big purchases for your business and help you understand the rules of depreciation.
2. Reconcile Accounts Receivable
Accounts receivable is money still owed to your business from goods/services already delivered. Resend any outstanding invoices and send follow-up emails emphasizing the importance of paying the balance due by a specific date or upon receipt.
Review your invoicing methods and payment processes. If you notice regular late payments from clients, there may be an opportunity to automate communication for fees, payment reminders, and late charges for non-payment.
3. Double-check payroll and benefits
Review what you are paying your employees and verify that your employees and vendors were compensated correctly. Make sure benefits are allocated and applied accurately. Use this information to plan for hiring, promoting, or reorganization within the company workforce.
4. Update your vendor information
Your vendors are businesses, also. Businesses experience many changes from year-to-year. Verify contact information, phone number, and address with vendors. Remove vendors who are no longer in business or no longer offer the services you need. The end of the year is also an excellent time to scout new vendors to fill gaps and negotiate contracts, rates, and service agreements.
Other Tasks In addition to the accounting side of the business, other pertinent items to add to your year-end checklist include IT updates, employee training, auditing your website, doing a brand audit, and updating your business goals.
Do not wait for the year-end to roll by to find yourself overwhelmed in the new year. Schedule an Introductory Call with a Touché Accountant to discuss our services and how we can help you manage your business finances.