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!
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!
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!