The end of the year isn’t just a time for family and holiday celebrations; it is also the end of the fiscal year for many businesses. Keeping accurate financial records is important all year long, but it is especially important as your fiscal year comes to a close. Your business can end up in some serious hot water if your records are inaccurate when it comes time to submit your information to the IRS. That’s why this article will focus on tips to help you prepare for the end of your fiscal year to help you keep everything in order.
Ensuring you have accurate information is the biggest hurdle to overcome and you can do that by reviewing your company’s profit and loss statements, checking inventory, reviewing your budget, and more. Here are five steps you need to take to prepare for the end of your fiscal year:
- Take A Closer Look At Your Profit And Loss Statements
Your company’s profit and loss statements will give you a general idea regarding your financial status throughout the year. Make sure your revenue and expenses are reported accurately and take immediate steps to remedy any issues you uncover.
- Conduct An Inventory Assessment
If your business sells a product, it is important to conduct a full inventory assessment to make sure you have an accurate account of the capital that’s allocated to your current inventory. Even if your business doesn’t sell products it is wise to take an inventory of the elements in your office, such as equipment, computers, copiers, etc.
- Verify The Information In Your Accounting System
Now is the time to comb through your QuickBooks accounting system to ensure that all information related to vendors, contractors, transactions, etc. is up-to-date and accurate. You will be required to issue 1099s to appropriate vendors at the end of your fiscal year and that will be much easier when the information is up to date and able to automatically populate the forms for you.
- Check Benefits For Year-End W-2s
All businesses are required to issue W-2s to employees. You need to make sure you are properly reporting any benefits given to your employees, including life and health insurance, educational reimbursement programs, transportation subsidies, and more.
- Start Planning Your Budget For Next Year
As you are reviewing your financial statements from the current year you will likely notice some patterns that can help you budget for the next fiscal year. Note the revenues and expenditures from the current year to help you plan more effectively for your future.
The end of the fiscal year can be a busy and trying time for small businesses. But you can make it a lot easier by preparing for the end of your fiscal year in advance.