Year-End Bookkeeping Checklist

Year-End Bookkeeping Checklist

Are you ready for the winter rush?

The temperature is dropping, there’s snow on the ground, and there are countless items on your to-do list. Once again, the most wonderful time of year has arrived and, boy, can it be stressful!

This time of year, you have to deal with everything from shopping to dropping the kids off for their school holiday concert practice. There’s so much on your plate that it can be difficult to know where to get started. This is one of the reasons why we want to make it as easy as possible for you to take care of your year-end bookkeeping with this simple checklist. By getting these things out of the way in the next few weeks, you’ll be ensuring that you’re positioned for a fantastic year ahead!

Update Your Bookkeeping Records

Throughout the course of a year, your bookkeeping can get a bit disorganized. If you aren’t working with a professional bookkeeper who will keep everything tidy and up-to-date, then it’s important for you to check your records at the end of the year to confirm everything is in order.

First, make sure that you’ve reconciled every bank and credit card statement with what is in your bookkeeping records. This will tell you if you’ve missed (or even double charged) a transaction.

Next, review your last few months of financial statements to confirm that the numbers are correct and that transactions weren’t improperly labeled. Make sure that your physical inventory, assets, and supplies match up with the numbers you have on paper.

Finally, don’t forget to double-check your accounts payable and accounts receivable (if you use the cash accounting method, you may want to wait to send invoices until January to keep your taxable income lower)!

We admit, updating your bookkeeping records is not the most enjoyable task, but it’s going to be invaluable when you need to do your taxes next year. If you simply can’t find the time to do it, we’d be happy to get everything ready for you!

Budgeting

We understand why you might dread going through your books at the end of the year. So many numbers, so little time! But one way that you can help keep everything on track for the following year is to set up a detailed budget.

By using the knowledge you gained from updating your bookkeeping records, you can project a reasonably accurate yearly budget for your business. By knowing your likely future income and expenses, goals can then be set that will help you grow your business next year.

Your yearly budget should be broken down into periods, monthly or quarterly (or both). This will also help you focus on goal setting for smaller sections of the year.

It can also be helpful to get some additional eyes on your projected budget to make sure that everything is in line with expectations. This is another area where we can help!

Set Goals for the Year Ahead

To be clear, we aren’t talking about a New Year’s Resolution here.

New Year’s Resolutions rarely work because they aren’t goals; they’re more like wishes. You need SMART goals that you can genuinely achieve in the upcoming year. SMART stands for: specific, measurable, attainable, relevant, and timely.

It can be helpful to break up your desired goals for the year, allowing you to regularly check-in and see how things are developing. We recommend setting up monthly, quarterly, and yearly goals. If you really want to get into the thick of it, you can also set up daily and weekly goals to improve smaller aspects of your business like daily reporting or customer management.

Reflect On Your Last Year

For small business owners, it’s almost always about “what’s next?” You’re focused on growth and on making your company a success. But it can pay to take some time at the end of the year to reflect on everything that happened to you over the last 12 months.

So much can happen that whizzes by in the moment. By taking a close look at your yearly successes, failures, and struggles, you can know where to focus your energy next year. On top of that, remembering successes can give you a feeling of accomplishment to give you a nice boost! And remember all of those headaches and problems you were dealing with earlier in the year? You’re now past them! Rejoice!

Tax Planning

By doing all of this bookkeeping work at the end of the year, you’re going to be setting yourself up for a much easier tax time in a few months.

Effective tax planning is key to a business’ success. If you aren’t sure of where to find relevant tax credits and rebates that will help you keep more of your money in your pocket, The Number Works would be happy to help!

By starting early, we can put together a plan that will you save big money on your taxes. At The Number Works, we’ll position your finances to maximize your year-end expenses and lower your taxable income. We can also assist with setting up a personal budget! If you’d like some help getting your year-end bookkeeping out of the way so that you can enjoy the holidays, please feel free to contact us today!

Is your Business Prepared for the Holiday Season?

Is your Business Prepared for the Holiday Season?

Did your business have a good summer? Hope so, because winter is fast on its way!

As the cold weather starts to set in, we’re reminded that the holidays are just around the corner. And although it’s not quite December yet, as a business owner, the festive season can take up a considerable chunk of your time – and your money! So it’s important to start preparing for the holiday season well in advance.

Maybe you’ve already begun stocking your shelves full of candy canes and tinsel, in preparation for the holiday cheer. Or perhaps you’ve noticed the need for extra inventory to get ready for your sales, discounts, and promotions. Whatever your usual holiday prep, here are five tips to make sure your business is more than prepared for this year’s holiday season!

1. Keep on Top of Your Cash Flow

It’s no surprise that the financial health of a company is one of its most vital aspects for any small business owner or entrepreneur. By understanding your business’ cash-flow, you’ll be able to properly budget for your added holiday inventory, as well as forecast for the new year.

It’s amazing how quickly the last six weeks of the calendar year can slip away from busy business owners. Even if you’re busy preparing for the upcoming festive season, it’s important to take the time now to go through your accounting ledgers and see where your business stands.

This is where an accountant can really help! If you’re too busy, need a second pair of eyes, or would like a more detailed understanding of what the numbers mean, give us a call! We’d be happy to help review your financial position to ensure that your business is adequately prepared for the holidays.

2. Stay Organized

Getting ready for the holiday season means organizing your books! Be sure to have all of your receipts and expenses filed neatly in preparation for the upcoming tax season. You may also wish to do some winter organizing in your filing cabinet or digital filing system.

Trust us. If you take the time to do this now, you’ll be stress-free in a few months when you need to budget and forecast for the new year. It will also free up time to focus on a strategy for your holiday inventory (more on that in tips #3 and #4.)

Most importantly, now is the time to double- and triple-check that all your invoices have been paid and anyone who owes you money is paying up! You’ll want to catch any clients with overdue invoices before they go on their Christmas break.

3. Strategize Your Sales

Now is the perfect time to do some research on your customer’s preferences so that, when the holiday season arrives, you’ll be stocked up on precisely what your target audience wants to buy.

Carve out some time to engage more meaningfully with your customers by asking them what they like—or dislike—about your business’ current products or services.

Collect customer feedback by going through the comments and criticisms left on your website or social media channels, being sure to track and log this feedback in your company’s CRM or customer database. To gain additional data, you could even conduct an online survey with a holiday incentive for completing it!

4. Expand Your Offerings

The holidays are a perfect time to introduce a new product or service! Don’t underestimate the power of innovation. As a small business owner, you know that taking risks by offering new products or services can often be rewarded with increased sales and customer growth. Wouldn’t that a great gift for the holidays?

So, take some time now to strategically think about how you can expand your company’s offerings. Use tip #3 and consult your customers to find out what additional products they would like your business to offer throughout the holiday season and into the new year.

5. Budget for Discounts and Promotions

The holidays aren’t only synonymous with gift-giving; they’re also closely associated with discounts, promotions, and sales! By offering special holiday promotions, you’re sure to increase sales and attract more customers. However, if you don’t start preparing now, putting on these sales could end up putting you in the red. Yikes!

If you followed tip #1 and took the time to meet with an accountant, you should have a good idea of the types of discounts you can afford to offer. Whether it be 40% off the regular price, a “Buy One, Get One Free” special, or merely adding a small bonus like a free sticker with purchase of $20 or more, make sure that your business will be taking advantage of this holiday period to increase sales. Really, just let your customers know that you care by giving them a little extra!

Bonus Tip: Don’t forget about your hardworking staff!

Ask your accountant to review your financials so you can budget for a little holiday bonus or a sweet holiday office party! Remember, your business is only as good as the team who helps run it. So don’t forget to show your team how much you appreciate them during this time of love and sharing.

Now that you’ve begun to prepare your business well in advance of the holiday season, you shouldn’t feel stressed or overwhelmed. But if you still need a little help, that’s more than ok! I’d be happy to be your one-stop-shop for all your accounting needs. Let’s connect and get started making this upcoming holiday season your best one yet!

So You’re Looking for the Best Accountant in Hamilton?

Are you looking to grow your Hamilton-based small business?

Well, here’s a little secret… One of the best ways to build your Hamilton, Ontario business and super-charge its growth is to partner with a professional accountant that you can really count on.

No matter what size your business, it’s imperative that you have the ability to accurately track and report all money flowing in and out of your accounts that concern sales, expenses, and salaries. Properly managing your books is not only Ontario and federal law, but it’s also the only way to fully understand how your business operates. This is the information that you need to make informed financial decisions and help your small business succeed. In fact, a lack of proper accounting is one of the most common reasons why a business fails.

And guess what? It’s completely avoidable!

So, how do you choose the right accountant for your Hamilton-based small business?

What’s the Difference Between a Bookkeeper and an Accountant

First, it’s important to understand the difference between an accountant and a bookkeeper. Simply put, a bookkeeper is responsible for keeping all financial transactions organized and systematic, while the job of an accountant is to analyze this financial data and interpret it so that it can be compiled it into a detailed report.

Generally, a bookkeeper works year-round to ensure that all of your financial data is accurate and organized. Then, once tax time rolls around, an accountant uses the bookkeeping information to prepare and file your business’ taxes.

No matter what the size of your Hamilton-based business, chances are that you could benefit from hiring both a bookkeeper and accountant. But why hire two separate people when you can find everything you’re looking for in one firm? Here at The Number Works, I can help you with both.

Finding the Best Accountant in Hamilton, Ontario

To pick the perfect Hamilton accountant and bookkeeper, you’ll need to ask yourself, “What really makes for a great accountant?” Is it their years of experience that matters most? Or is it more than that?

By knowing how to recognize proper credentials, you’ll be able to make better decisions about the kind of accountant you want to partner with. This will allow you to better set specific expectations for the working relationship.

1. They’re On Top of Current Trends in Technology

Today, the accounting world has primarily moved into the digital realm. Cloud-based accounting software is increasingly becoming more and more important for managing your books. No matter which bookkeeping software your business chooses, it’s vital that your bookkeeper knows how to properly use all software functions including bank reconciliations, accounts receivable, and accounts payable.

Here at The Number Works, I’m tech savvy and I’m even a Quickbooks Gold Proadvisor. I know how to set up a perfect workflow that will make your accounting processes as smooth, painless, and informative as possible.

2. They’re Detail Oriented with an Analytical mind

As someone who works with data all day, it’s vital for your bookkeeper to be thorough and pay attention to detail. For instance, when you make a sale, your accountant should accurately track who the customer is and the exact terms of the sale.

An excellent accountant should also be able to analyze your financial transactions and accurately record them in financial statements and reports using generally accepted accounting principles. They should be able to use these numbers to analyze your business in a way that will help you make important decisions and, ultimately, grow your business.

At The Number Works, I pride myself on my eagle eyes! Where it might just look like a maze of numbers to you, I find it so satisfying to dive into the puzzle of your numbers and to leave no stone unturned to balance your books.

3. They Have a Good Knowledge of Ontario Tax Laws

The great thing about working with an accountant who also takes care of your bookkeeping is that they aren’t just familiar with the daily transactions of your business, they’re also expects in Ontario taxes. They know the importance of keeping your books in order throughout the year because they’ll also be the one to sort out the nitty gritty when it comes to your year-end tax filing.

At The Number Works, not only am I a bookkeeper and accountant, but I’m also a profit advisor, and a CPA, CMA. I know Ontario tax laws inside and out and I’ll ensure that your business never misses a potential tax credit.

4. They’re Client-Focused

Beyond a good head for numbers, a great accountant should care about you as their client. They should also understand the industry, sector, and their clients in detail. Your accountant should have an excellent understanding of your business’ goals and requirements so that they know which accounting rules or economic measures will best meet your business’ needs.

My goal is to put you first, taking care of your business numbers to eliminate the the pain from bookkeeping and provide unlimited support to you so you can focus on your passions. This is so important to me and I promise to treat your business with attention, care, and integrity.

5. They Have Impeccable Communication Skills

It’s important that your accountant knows how to clearly translate complicated accounting concepts into crucial insights. After all, if your Hamilton accountant can’t accurately explain their insights to you, then why would you want to hire them? Always look for an accountant who can communicate their ideas in simple, easy to understand language so you can work together to improve your business.

At The Number Works, I promise to take the jargon out of your accounting! I’ll make your accounting smooth and easy to understand and communicate with you every step of the way so there are no surprises or unknowns.

Why The Number Works is Your Best Choice for Both Bookkeeping and Accounting in Hamilton, Ontario

The Number Works Professional Corporation is a virtual bookkeeping, accounting, and financial coaching firm that helps creative entrepreneurs, like yourself, tell their financial story. Services offered range from cloud-based bookkeeping, full cycle accounting, financial statement analysis, strategic planning, and taxes.

I can be your one-stop shop for the best accounting in Hamilton and the surrounding Southern Ontario area. In fact, I can help you no matter where you are in Ontario, working with your business seamlessly with virtual technology.

By outsourcing your bookkeeping and accounting needs to The Number Works, you get all the benefits of competent financial reporting without the hassle of needing to onboard, train, and pay a full-time employee. I have a passion for process, efficiency, simplicity, and helping small businesses succeed.

If you’re looking for an accountant in Hamilton, let’s connect! I’d be happy to have a conversation with you to get to know your business and to see if we’re the right fit to partner with one another to help your business succeed.

Hiring Bookkeeper

The Benefits of Hiring a Bookkeeper for Your Small Business

Did you know that hiring a bookkeeper for your small business could actually save you money? Making mistakes add up, especially if those mistakes result in an audit or even bankruptcy. Plus, 30 percent of small businesses fail within two years and it’s because their expenses outweigh their profits. Yikes! So it’s clearly important to keep an accurate book—and what better way to do that than by hiring a professional bookkeeper?

There are so many benefits to hiring a bookkeeper for your small business. We’ve listed the top 8 reasons here:

1. Dedicate Your Time To Your Core Business Needs

As the founder of your small business, it’s best to stick with what you’re good at. Unless you’ve founded a small accounting business, chances are your strengths lie in other areas… And those other areas need your full attention.

There’s no better way to free up your time so that you can focus on what you’re best at than by leaving the financials in the hands of a capable bookkeeper. With the time that you aren’t spending floundering on your books, you’ll have time to devote to strategy, marketing, funding, and other key areas that require your focus. You’ll have peace of mind knowing that your books are accurate and real reports to show you your profit and loss and other key reports to help you grow your business.

2. Improve Your Work-Life Balance

As a solopreneur or founder of a small business you’re busy, busy, busy! There’s so much to do and while being a hands-on business owner is crucial to any business’ success, you still need some time at the end of the day or week for yourself and your loved ones. No matter how great of a multitasker you may be, every person needs balance in order to stay healthy and not burn out.

Burn out is a serious risk for entrepreneurs and as much as you may think that you can do it all, at some point the stress will catch up with you and your business will suffer. So if you want to see your business grow, don’t forget to make some “me time” Letting a bookkeeper handle the finances will take a huge load off your shoulders!

3. Two Heads are Better Than One

Of course, you’ve got a handle on your business—you rock and we don’t doubt it! But it never hurts to have a second set of eyes to help catch mistakes, catch things that the first set of eyes might have missed, or to give a fresh perspective on the state of your business.

A bookkeeper won’t just put the financials in order; they’ll also run reports that show how you’re really doing each month, where the funds are going, and how your efforts are paying off. By having a professional crunch those numbers, you’ll be able to get the big picture and ensure the growth of your business.

4. Avoid the Monotony

We’re sure that your business lights a fire in your soul that motivates you every day, but it’s still hard to imagine that the financial aspects of your business are what get you out of bed in the morning. You likely have no passionate feelings about excel spreadsheets full of numbers or keeping track of payroll. That’s ok! Because your bookkeeper actually enjoys those tasks!

It makes sense to hand over your financials to someone who really does get excited about numbers. Not only will you benefit from not being dragged down by a task you don’t like and haven’t been particularly trained for, but you’ll also be able to pump twice as much enthusiasm into your business; your own, uninterrupted enthusiasm plus the energy from your passionate numbers person. It’s definitely win:win.

5. Get Everything Paid on Time

Did you know that if you miss a bill or forget to pay something important, it will significantly impact your business credit? Uh oh! Between meetings with clients,  troubleshooting daily issues, and focusing on the future of your startup, it’s quite likely that things fall through the cracks along the way.

Often bills that need to get paid are forgotten. Avoid the stress of late bills by putting a bookkeeper in charge! And what about collections? You don’t want to forget to collect your money, do you? Your business can’t afford to let money matters slip. With the help of a reliable bookkeeper, you can rest assured that everything is paid on time and you can get back to doing what you love—running your small business.

6. Take the Hassle Out of Tax Time

Even if you’ve finally figured out payroll and you’ve got a system down for outstanding invoices, when it comes to filing your business taxes you definitely don’t want to make a mistake. Based on the type of business structure you’ve created for your startup, you’ll have many tax requirements, HST payments, and other filings. This can be a major point of stress for many business owners!

The first great thing about working with a bookkeeper throughout the year is that when it comes to tax season, everything will already be organized. This is HUGE in terms of stress management! Your bookkeeper will have already won most of the battle by keeping your books in tip top order.

Secondly, as for your final tax details, a bookkeeper is a pro; they’ll know what tax credits are available to you and how to optimize your tax filing for the best possible results. It’s ideal to find a bookkeeper who can handle your taxes in addition to payroll and other financial issues for full peace of mind and no headaches.

7. Keep Your Cash Flowing

Late payments are a problem for many small businesses, and that’s true for your own clients who owe you money. This can put a serious damper on your cash flow. Often your clients will have outstanding invoices and these can start to really drag your business down.

Seeing as you’re so busy, you may not realize that there are late payments infringing upon the cash flow you need to keep your startup running smoothly. But having a bookkeeper working for you will help you stay on top of these issues.

Your bookkeeper can send out reminders to make sure your cash flow remains optimal and, bonus, this will look good if you ever decide to seek out funding because you can show a positive cash flow that you might not have been able to show without that financial help.

8. Keep Costs Down

Although it may seem logical to do everything yourself to save money, that’s not actually the truth of most small business dealings. In fact, a professional bookkeeper actually saves you money because there’s a reduced level of risk from human error, lack of knowledge, missed payments, tax obligation due dates, and delayed accounts receivable.

As we’ve all heard before; time is money. You need to be smart about how you choose to use your time. The time you spend on your books could be used instead towards bringing in more clients, delivering excellent customer service, and bringing in the revenue to see the growth you want.

Plus, there are many options for hiring a bookkeeper and rather than bringing someone on payroll full- or part-time, a freelance bookkeeper can be very cost effective. When you outsource your bookkeeping to a professional who is themselves a business owner, you don’t have to pay payroll taxes, sick leave, vacation, etc. that you would have to pay when hiring an in-house employee keeping your costs down even more!

 

Outsourcing your bookkeeping is quite possibly the smartest step that a small business owner can take towards their overall business success. From saving time and money, to focusing on your expertise, and increasing cash flow, a bookkeeper makes good business sense for your startup. Here at the Number Works we’re always excited to help out small business owners. We would love to get behind your success. If you have any questions, please don’t hesitate to contact us today!

Business Plan to turn Passion into Profits

For many business owners, the idea of creating a business plan is either new or overwhelming. With no clear place to start or understanding of its importance, business plans go left unwritten, and your business could be suffering because of it.
A business plan provides a roadmap to get your business running and headed in the direction of growth and profitability. Getting and keeping your business on track.
A business plan is a requirement when looking for investors. You may have a great pitch, but investors want to see the numbers and the logic behind it. A solid business plan will give investors an understanding of what to expect from your company, as well as a good indication of who you are as a creative entrepreneur.
Not looking for any investors to get your business going? You may think you are off the hook for creating a business plan, but you should think again. Writing a business plan solidifies your product offerings, your fees, expenses and projected revenues which allows for the creation of a strong plan to carry you forward. Something that you can hold yourself up to and check in with to make sure you are on track to getting where you wanted to go.
Some key concepts found in good business plans are:
A clear purpose which explains why your business is important, which problems do you solve for? Which pain points to you alleviate for your customers?
An identification of who your ideal customers are. Have a clear understanding of their pain points, their challenges. An explanation of why your product/services are perfect for them to help alleviate their stresses you have identified.
A description of your product/service clearly identifying what you are offering to your customers, and what makes your business unique from competitors.
A plan for marketing your brand. What resources will you use to promote your business and what results are expected from your efforts.
A sustainable monetization model. How will you make money from your product/services to create a profitable business, what type of key performance indicators do you need to track to monitor your profitability.
Once your business is off the ground, you will need to make sure that you are tracking to your business plan that you spent some much time creating. This is where we can help build the content to craft your financial story, turning your passion into profits.

Benefits of Outsourcing

Unless you are an accountant, you likely didn’t start your own business to crunch numbers and balance your books. In the interest of time, money and quality, outsourcing to an expert can be beneficial.
5 benefits to outsourcing are to:
Reduce Costs – hiring, training and monitoring staff in areas that you aren’t familiar, such as HR or finance, can be costly.  Outsourcing these tasks will reduce your overhead, you only pay for what you use and can ensure it is a qualified professional that you won’t need to train.
Increase Efficiency – by removing the stress of tasks that your business doesn’t specialize in, allows time for you company to focus streamlining your business and doing more with less.
Improve Quality – by focusing all of your resources on the aspects of the company which drive the product for the end user, and outsourcing effectively the areas that you don’t specialize in can lead to an improved quality product or service.
Reduce Risk – with a rapidly changing market and environment of government regulations, technologies, and financial conditions, outsourcing to those that specialize in these areas can help to guide your business decisions to avoid taking unnecessary risks.
Drive Results – by hiring the right company to help with back office tasks that you don’t specialize in,  allows you the time to spend on what you do best, focusing on the core of your business needs.
Focus on what you do the best, and outsource the rest. Contact us to outsource your bookkeeping and accounting needs.