As the end of the year draws near, having a head start in collecting information for next year’s taxes is beneficial. In addition, having an accounting year-end checklist can help make sure all outstanding business tasks are taken care of before the new year begins.
Use this checklist to better meet your company needs:
Get all Documents in One Place
These could include:
- Bank statements
- Credit card statements
- Inventory counts
- Last year’s tax return documents
- Loan statements
- Payroll reports
Organize and Review Your Books
Take some time to review the financial statements and ensure the accuracy of transactions. Comparing bank and credit card statements to your accounting software can help find duplicate or missing entries. If your company does not have the extra time to dedicate to this kind of review, consider outsourcing by hiring a reputable bookkeeper or accountant.
Prepare important financial documents such as the balance sheet, income statement, and statement of cash flows. Having these on hand will help give a full picture of your company come tax time. While reviewing your financial statements, look at your company’s financial state, find your profit margin and get an overview of the company’s financial health. Having access to this information early will help in next year’s planning and budgeting.
Review Important Documents and Transactions
- Make sure all collections and debts are settled and keep a record of outstanding checks and transactions. In accounts receivable, look for missing invoices and make contact with customers that have unpaid balances.
- Review a current inventory assessment and compare the results to a previous assessment to see needed adjustments accurately reflect current inventory.
- Review vendors in preparation for 1099’s
- Pull a transaction list by vendor. If they are not incorporated and have made $600.00 or more in the year, make sure you have a W9 on file for them.
- Review employee files to ensure their documentation on file is correct and update anything that needs to be updated. Ensure all documents are in place to support other items that may appear on a W2: health and life insurance, educational reimbursement, transportation reimbursements, and any other fringe benefits or year-end bonuses.
Review Current Goals & Set New Goals
- Evaluate this year’s goals to see which ones you met and which ones are still in progress.
- Set next year’s goals. Make them specific, measurable, and achievable.
- Set next year’s budget and review your current year’s budget. Compare the current budget with your financial statements to evaluate what areas went over budget and under budget. Use this information to help set next year’s budget.
Taking the time now to prepare for next year will save time and headaches in the long run. In addition, you will enter the new year with a clear view of your company’s financial position and will have documentation in place to ensure a smooth tax preparation process.
At Abacus CPAs, our focus is you! We believe that our employees and clients deserve to interact in an environment that fosters growth, trust, and confidence. Our team focuses on tax, accounting, audit, and business consulting to partner with you and your business. Abacus professionals provide leadership by relentlessly pursuing the best guidance possible so those we serve can make smarter decisions.
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