As the financial year draws to a close, small and medium-sized enterprises (SMEs) face the crucial task of getting their accounts in order. A comprehensive year-end checklist can ensure a smooth transition into the new fiscal year, helping businesses to review their financial health and plan for the future. Here’s your ultimate checklist.
Reconcile all bank accounts
Ensure all business bank accounts are reconciled with your accounting records. Discrepancies should be investigated and resolved to reflect the accurate financial position of your business.
Review outstanding invoices
Examine any outstanding invoices, both receivable and payable. Chase up late payments to improve cash flow and settle any debts to start the new year afresh.
Inventory stocktake
Conduct a physical inventory count and reconcile this with your records. Adjust any discrepancies and evaluate if inventory levels are aligned with your business strategy.
Depreciate assets and review investments
Calculate depreciation for fixed assets and assess the value of your investments. This review can impact your tax liabilities and influence future investment decisions.
Prepare financial statements
Compile key financial statements: the balance sheet, income statement, and cash flow statement. These documents offer valuable insights into your business’s financial performance over the past year.
Assess tax liabilities
Calculate your tax liabilities, including VAT, corporation tax, and any other relevant taxes. Consider seeking advice from a tax professional to ensure accuracy and explore potential savings.
Set budgets and financial goals
Based on your year-end review, set budgets for the upcoming year. Establish financial goals that support your business’s strategic objectives and growth plans.
Review payroll and employee benefits
Ensure all payroll records are accurate and up-to-date. Review employee benefits and contributions to ensure compliance and consider adjustments for the new year.
Check compliance with financial regulations
Ensure your business complies with all relevant financial regulations and reporting standards. This includes GDPR compliance for handling personal data and any industry-specific financial regulations.
Evaluate financial processes and software
Reflect on the efficiency of your financial processes and the effectiveness of your accounting software. Consider upgrades or changes to streamline operations in the new fiscal year.
Completing a year-end financial review is essential for any SME. It not only ensures compliance and readiness for tax season but also provides a foundation for strategic planning and decision-making. By following this checklist, SME accountants can help businesses close the year confidently and start the new one on solid ground.
Did you know?
Evolve Accounting specialises in year-end accounting and financial planning for SMEs. Our team offers the expertise and support you need to navigate year-end processes efficiently, ensuring your business is prepared for whatever lies ahead. To partner with us for your year-end accounting needs, get in touch today.
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