Year End Financial Checklist
Year End is upon us – it’s hard to believe that 2013 is almost over! December is a busy month for a lot of businesses, and with all the festivities going on around the holidays and shopping to do, it is hard to focus on work, but you need to make sure that your books are also in order for year end. Here is a year end checklist with some things to consider as we are approaching the New Year.
- Review Subcontractors: If you paid anyone for services of more than $600 during then you will need to issue them a 1099-MISC report by January 31st. Make sure that you have your subcontractors’ complete and updated address as well as their correct Federal Tax ID number or Social Security number if they are an individual. It is good practice to have each subcontractor fill out a W9 form when you hire them or at least PRIOR to paying them. This way, if they are waiting on work or a check, they will be more motivated to get the completed form back to you in a timely manner. Also make sure to view all checks to the vendors to make sure that they are posting to the correct account which will show up on your 1099 report. If you have given them checks for reimbursement of expenses that they submitted, these amounts should not be entered on the 1099-MISC form because it was not income to the subcontractor.
- Invoicing: Send out invoices for any billed items that have been sold or services that have been rendered prior to year end.
- Accounts Receivable: Check the accuracy of your Accounts Receivable. Are all of these unpaid invoices actually unpaid? If there are invoices that are un-collectable, you might consider writing them off to bad debt at year end.
- Accounts Payable: Check the accuracy of your Accounts Payable. Are all of these bills actually unpaid? Make sure that all of the bills are entered.
- Reconciliations: Make sure your bank accounts, savings accounts, loan accounts, credit card statements are balanced and reflect the balances as stated on the statements at year end.
- Inventory: If you have inventory prior to selling any items in the New Year, you will want to do a physical inventory at year end to check the accuracy of the inventory that is stated on your books and then do inventory adjustments to make those numbers accurate. Also it is good practice, if there are any discrepancies, to investigate the reason for these discrepancies and put procedures in place to prevent these errors in the future. Once you get your final physical inventory count, consider implementing a perpetual inventory for the upcoming year.
Other items to consider for the upcoming year:
- Budget: Look over your expenses; do they seem a bit high in areas? Do you know what you are spending each month and when things are due? Consider developing a budget for next year to keep the expenses in line.
- Cash Flow: Were you a bit short on cash at any times of the year? Consider a cash flow spreadsheet. When you combine this with your budget, you will know ahead of time when you are going to be short so that you can move cash around, get a loan, etc. to help carry you through.
- Goal Setting: If you really want to grow your business in the New Year, at year end, set specific goals for the upcoming year and make sure that you can measure the progress of these goals. Don’t just say “I want to increase profits”, say something like “I want to increase profits by 20%”. Then figure out what you need to do to get there.
- Analyze the bottlenecks in your business: What takes you the most time or is the most difficult to do and figure out ways to streamline these processes.
When you work with Dailey Bookkeeping Services, we have meetings with you and go over items like the ones described above and help you to focus on ways to grow and increase profits. There are many other items that need to be done at year end, and hopefully you have your accounting outsourced to a professional bookkeeping service. If you are not outsourcing your bookkeeping, give yourself a gift this year and contact us so that you can enjoy the holidays and spend more time working on growing your business and more importantly, with your family!
Merry Christmas and Happy New Year from Dailey Bookkeeping Services!
If you are in need of help with your getting your books in order for year end, Dailey Bookkeeping Services would love to help you . The owner, Jacqueline Dailey is a Certified Public Bookkeeper, an Advanced Certified QuickBooks and QuickBooks Online ProAdvisor, a Sleeter Group Certified QuickBooks Consultant and a Xero Certified Bronze Partner. We work remotely so we can work with any company located in the U.S. If we can help you with this process or provide you with custom reporting, please give us a call. If we cannot help you, we will refer you to someone who can!