Accounting Year-End Preparation
There are many steps that a business owner can take to help prepare themselves not only for year-end but the tax season that is fast-approaching. The tips provided below are to help business owners ensure that their books are in the best possible shape to end the year. It also helps your tax accountant process the business tax returns quickly and efficiently. Lastly, it saves the business owner time and money because the tax accountant will not need to spend extra time, charge more fees, on books that are unreconciled or incorrect.
Year-End Preparation Tips
1. Bank reconciliations should be up to date. Your balances in all your cash accounts should be valid and be substantiated. This also includes advance accounts, petty cash accounts and credit card accounts.
2. Go through both your accounts receivable and accounts payable reports. Make sure that both reports contain correct information. This is also necessary for proper planning in the new year as to when you can expect payments and when you will need to make vendor payments.
3. Update your fixed assets and process an entry for depreciation, you can discuss this entry with your tax accountant prior to making the entry.
4. Check to see if any amounts need to be reclass. Check to see if any bad debts need to be written off. Check to see if any outstanding check payments need to be voided and reissued in the following month.
5. If payroll is being processed, make sure all payroll taxes been paid that are due. Also make sure all payroll filings for the year have been completed. If 1099’s are being issued, make sure to have all the information needed to issue them in January.
6. Run a balance sheet and profit & loss statement, go through each account to make sure that these reports are validated and ready to be provided to your tax accountant.