Get ready for the new fiscal year with this year-end accounting checklist

This content is sponsored by Cordia Partners and Cordia Resources.

Keeping your financial records in order is very important for the success of a business. As the end of the calendar year approaches, the accounting and finance departments begin to work diligently to close their books so that they can prepare to file tax returns and be prepared for their audit. To avoid missing steps and ensure a smooth transition to the new fiscal year, we have prepared this year-end accounting checklist.

Document accounting transactions

Document all entries in the accounting system and make adjustments at the end of the year to take into account merits and deferrals.

Reconcile all balance sheet accounts

View all your company’s bank and credit accounts and reconcile all charges and payments. Make sure the statements match your records and investigate any unexplained discrepancies.

Review the profit and loss account accounts for incorrect ratings

Review expense accounts to determine if any charges should be reclassified to fixed assets, prepaid expenses, or other balance sheet accounts. Also look for expenses that have been charged to the wrong expense account and reclassify them if necessary. An accurate classification of expenses will make the preparation of the budget for the coming years much more informative and simple.

Payroll and seller tax forms

• Years 1099: These forms must be emailed no later than January 31 to any independent contractor you have hired. Be sure to collect vendor tax identifiers and other necessary information before the end of the year if you have not collected this information throughout the year.
• 1096: This form must be mailed to the IRS no later than February 28th.
• Payroll forms (e.g. W-2, W-3, 940, 941): Print and mail these forms as soon as you can, especially if you are handling them yourself and do not ask a payroll service or an accounting firm external to prepare the forms. Be sure to include non-standard taxable income on W-2 employees, such as the taxable portion of the business group’s long-term life insurance, taxable education refunds, and other non-taxable income. they can be processed during the normal payroll cycle. Remember that your employees cannot file taxes until they receive a W-2 and many people like to file taxes as soon as possible.

Close outstanding debts

Make an effort to collect unpaid bills to close all outstanding payments and improve control over your cash flow.

Create an annual budget

Start planning an annual budget by reviewing the interim financial statements for the current year. These will provide information on the current year’s expenditures and boost the financial forecast and budget for the following year.

Be prepared for the audit

If your financial resources do not meet the GAAP, now is the time to start moving in that direction. If the search for financing or the sale of a business is in the near future, investors will need accurate financial information. Working to comply also means you can be prepared for audits.

Evaluate internal controls

Review internal processes and controls to make sure they work. Look for process gaps that allow fraud or errors to grow.

Evaluate process improvements

If manual data entry slows down the process of preparing accurate financial statements on time or impedes staff performance, consider using automation to improve the accounting process. Demonstration of desired programs and budget for the coming year.

The end of the fiscal year is a crazy time for any company, but smaller companies feel the skin even harder due to staff limitation and the availability of skills. Get ready and make sure you cut all the steps needed for a successful and responsible end to the fiscal year.

To hire temporary or permanent accounting help, visit www.cordiaresources.com. For tips on accounting technology or when and how to outsource accounting functions, visit www.cordiapartners.com.