As a small business owner, it’s a good idea to start the New Year on the right foot, especially if it’s the end of your financial year. If you tidy and organize your accounting information now, it will make filing a tax return all the easier.
Since the end of the year is busy with work-related, family, and social commitments, the sooner you get things underway – especially as far as your financial records go – the better.
See Where You Stand
Using your accounting software or spreadsheets, generate a complete financial report for the year – with a profit-loss statement, balance sheet, and cash-flow statement – to determine your financial standing. And analyze your cash flow to see how money was spent throughout the year, as far as operating, investing and financial activities.
Look After Your Vendors and Contractors
It’s a good idea to pay any outstanding amounts to your vendors and contractors by year’s end. For contractors, you may have to submit a W-9 form, and you’ll also have to give each one a 1099-MISC form by the end of January.
You should also verify all the contact information for the vendors, purging inactive accounts and wrong information, and taking time to evaluate whether it is worth carrying your business relationships forward into the New Year.
Take Care of Accounts Receivable
See what invoices are unpaid and which clients owe you money for completed work, and, if possible, collect the outstanding bills before the end of the year. This will give you a fresh start and positive cash flow going forward.
Get Your Employees Up to Date
Make sure your payroll is completely up to date, with only current employees in the database. If you decide to reward your employees with end-of-year bonuses, don’t forget about tax. Like regular pay, bonuses are subject to income tax withholding.
Also, look ahead. Do you need to increase staffing for the coming year? And do you have the budget to do this?
Stay on Top of Your Payroll and Benefits
It’s a wise practice to keep up with any issues or corrections that you need to make to your payroll before year’s end. Benefits that are easy to forget are taxable fringe ones, such as third-party sick pay or company vehicles, as well as benefits like educational reimbursement, health and life insurance, and transportation subsidies.
Count Your Inventory
If you keep products or material on-site or in a warehouse, you should conduct an inventory count before the New Year, updating your current records. Investigate any significant discrepancies.
Make Sure Your Website is in Good Running Order
While it may seem at first that ensuring your website is working well is an IT task, it’s more than this. A website is essential to your business – your digital calling card to the wider world and, perhaps, its e-commerce activities are helping to drive your bottom line.
Take the time to make sure that all links and contact forms are working correctly. Is all the site information relevant and up to date? Do you need to plan ahead and find the budget to make your site design responsive, so it works well on smartphones and mobile screens, as well as regular computer ones?
Review Your Past Year’s Goals and Set the Way Forward
Did you achieve all the business goals you had set yourself for the year just done? If not, determine why and include that learning in the goals you set yourself for the year coming, to keep yourself on track as your business grows or meets new challenges.
The ways to assess your previous year’s performance include reviewing your financial statements, customer input, and feedback from your team.
To help your small business with its accounting needs at the end of year, and year-round, contact Shockley Bookkeeping and Tax Services. Let us take care of bookkeeping tasks ranging from data entry and debt collection to paying bills and organizing finances, and you can concentrate on running and growing your business.
Contact us today for a free consultation and quote.