EOY Reminders

As the year draws to a close, small businesses must turn their attention to end-of-year bookkeeping tasks. Efficiently wrapping up your financials can pave the way for a successful new year. Here are crucial tasks and reminders to ensure your small business's books are in order:

1. Reconcile All Accounts: Ensure that your bank and credit card statements match the transactions recorded in your books. Reconciling helps identify any discrepancies or fraudulent activities that need to be addressed.
2. Review Accounts Receivable: Collect outstanding invoices to boost your year-end cash flow. Send reminders to clients who have overdue payments and consider writing off bad debts as a deduction.
3. Inventory Assessment: Conduct an inventory check to determine the value of your current stock. Accurate inventory tracking affects cost of goods sold (COGS) calculations and tax liabilities.
4. Organize Expense Receipts: Gather and categorize all expense receipts. Separate business expenses from personal ones and ensure that each expense is documented and justified.
5. Prepare Financial Statements: Generate key financial reports like the Income Statement, Balance Sheet, and Cash Flow Statement. These documents offer valuable insights into your business’s financial health.
6. Assess Payroll and Employee Benefits: Review payroll records for accuracy. Confirm that employee benefits and contributions, such as retirement plan deposits, are up-to-date.
7. Evaluate Tax Deductions and Credits: Identify potential tax deductions and credits available for your business. Consider expenses like home office costs, travel, and professional development.
8. Plan for Estimated Taxes: Calculate your estimated tax payments for the next year based on this year’s earnings. Staying on top of estimated taxes can prevent underpayment penalties.
9. Consult with Your Accountant: Schedule a meeting with your accountant to discuss tax strategies and financial planning for the upcoming year.
10. Digitize and Back Up Records: Digitize physical records and ensure all financial data is backed up securely. This step is crucial for data recovery in case of unexpected disasters.

By diligently completing these end-of-year bookkeeping tasks, small businesses can close their books with confidence and step into the new year ready for fresh challenges and opportunities. Remember, thorough and accurate bookkeeping is not just a regulatory requirement; it’s a cornerstone of sound business management.