As year-end is fast approaching, anxiety levels are likely at an all time high for small business owners. But are you strapping down to focus on your accounting checklist or are you more focused on completing your Christmas checklist?
We get it. Year-end is the busiest time of the year—from holiday parties to gift shopping and wrapping, how could there possibly be enough time for bookkeeping as well? As busy as you may be (and as much as you’d like to be wrapping those gifts), the truth is, the effort you put in at year-end sets the framework for the entire upcoming period.
Ready to get started? Here’s a checklist for year-end tasks to keep your books on track:
Confirm Your Bookkeeping is Updated and Accurate
Let’s be real. In order to efficiently tackle your year-end accounting checklist, you should really be staying on top of your small business’ finances throughout the year.
Perhaps you let a month (or months) slip by. Don’t worry, year-end is the time to confront your tax enemies!
Reconcile your bank account and / or credit cards (to what you have in your accounting records) to catch any transactions that may have been missed or double-counted.
Once your books are up-to-date, you can review each financial statement account to make sure amounts are accurate and that it reflects all your transactions for the year. For instance, if you spend $1200 in office rent per month but your income statement shows $2000, then this is a sure fire way to know that something isn’t adding up, and to take corrective action.
Do a Profit & Loss Review
A profit and loss statement shows your company’s revenues and expenses during a specific period of time. Not only that, it gives you key information about the health of your business by showing how your business’ revenues are turned into net income.
Organize Accounts Receivable, Billing and Invoices
It’s common for most small business owner to have one or two clients who pays invoices late or occasionally go “off-the-grid” during the week of invoices. These clients can have an adverse impact on your cash flow!
Year-end is a good time to switch your focus to organizing all your invoices and accounts receivable—aka outstanding invoices awaiting payment. Whether it’s chasing down a client with a phone-call (or two), now is the time to settle these outstanding invoices before the end of the year. This way, you can collect as much revenue as possible before year-end.
Organize Your Receipts
Whether you bought a new printer 6 months ago or took your client out for lunch last week, any receipt that pertains to your small business should be collected and stored. This includes receipts from inventory, office supplies, advertising, travel, entertainment, and other related purchases.
With Kashoo, your receipts can be stored from anywhere, so long as you have an iPhone or iPad, our App, and WiFi or data. Because receipts fade easily, storing them on the cloud will ensure that your company expenses are always up-to-date—meaning less hassle come tax time.
Conduct a High-Level Reflection (Of The Good and Bad)
As a small business owner, it’s far too easy to get wrapped up in the day-to-day operations of your business. You’re meeting clients, checking emails, negotiating deals—the list goes on.
But don’t let yourself get carried away with only these activities. Use year-end as a time to reflect. To help remind you of your business mission, you’ll want to ask yourself a few questions such as:
- Which areas did I do well?
- Which areas can I improve on?
- What were my goals this year and did I achieve them?
- What are my lessons learned?
It’s important to document and archive these during your reflection so that you can easily retrieve this information in the new year.
Compiling a year-end checklist to tackle during the holiday season can be extremely stressful, but by doing so, you’ll give yourself full clarity in the current state of your financials. With tax season looming in the horizon, now is the time to stay on top of your bookkeeping and even set you up for success for the following year. To make year-end even easier, try Kashoo for 14 days free to see how we can help you stay organized!