Year-end Clean up for New Year Success
December is here. We have made a checklist to help you not forget things. After the holidays your mind may come empty.
- Make sure your bookkeeping is updated and accurate
To ensure accuracy, you should reconcile each bank and/or credit card statement to what you have in your accounting records.
Once your books are up-to-date, you should review each financial statement account to make sure amounts are correct and reflects all of your transactions for the year.
- Review your accounts payable and accounts receivable
Throughout the year, you may not always keep up with who owes you what or who you owe. But year end is the time to clear up any confusion.
For the accounts receivable, check if anything looks incorrect or if there are some missing invoices. And while you’re at it, you should probably contact those who are late in paying it.
And as for the accounts payable, ensure that they are also correct and go through each of them to check if they make sense. If there’s any late bills, you should also pay them before your year end.
- Take inventory
If you sell products, count how much inventory you have on hand.
This also acts as a double check of the inventory value on your balance sheet. If you find discrepancies between the two, adjust where necessary.
Counting inventory does not have to be limited to the products you sell but can include the assets and supplies you have too.
- Tax plan
The purpose of tax planning is to pay the least amount of tax as the law allows. Year end tax planning gives you the opportunity to position certain transactions to save you in taxes.
One tax planning strategy is to accelerate expenses you were planning to buy early in the new year. Maybe you have software subscriptions that need to be renewed. Renew them before the end of the year. What this does is increase your expenses and lower your taxable income.
Defer sending invoices to customers, if you can. If you can wait to send invoices until January, your taxable income will be lower than if you sent them in the current year.
- Trucks cleaned out
- Garbage disposed
- Business card stock
- Invoice form
- Door hangers
- Logo stickers on timers
It’s time to celebrate everyone’s effort in the year. Plan for a year-end party. It doesn’t have to be fancy. Just something your crew enjoy and have a great time.
Schedule holiday working calendar well in advance as many people would take vacations during this time.
As a business owner, it is easy to get wrapped up in the day-to-day operations of your business. You check emails, fulfill orders, speak with clients, negotiate deals, the list just goes on.
However, it is so important not to forget your vision and reflect on the ways you have or have not aligned your business with your vision.
Year end is a great time to reflect. You’re able to see things from a full circle perspective which can enlighten you as to the good or bad decisions you made.
What did you do well? Where could you improve? What goals did you achieve?
Answering these types of questions will help you make and continue to make profitable business decisions in the future.
Therefore, taking the time to reflect on the year’s events should be a part of your year end checklist.