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Financial Year-End Tips for Small Business Bookkeeping

Every year small businesses have the potential for growth, and yours is no exception.

Of course in order to do that, taking care of your bookkeeping is one of the most important aspects of running and growing any successful operation. 

However, with all the other tasks that a small business owner needs to handle on a daily basis, it can be challenging to find time to take on the tedious task of bookkeeping.    

It’s crucial to keep your business finances in order. Doing so helps you run your day-to-day operations smoothly, and most importantly, allows you to make strategic business decisions for the future of your business.

That’s why at the end of every fiscal year, you should take the time to evaluate your small business’s performance and make plans for the coming year. 

If you were trying to be thrifty in 2022 and decided not to hire a bookkeeper, we still want to look out for you. ?

So, here are some tips for wrapping up your year-end bookkeeping:

Wrap up 2022 sales & expenses 

One of the most critical aspects of closing your business’ fiscal year is making sure that all income and expenses are recorded and up to date. Provide proper documentation (such as copies of invoices) for any capital assets purchased during the year. 

Finalize Inventory Records 

If you use accounting software to track inventory values, the values should be up to date.

However, this shouldn’t take the place of manually counting your inventory at least once per year to compare and adjust as required. 

Balance Your Accounts 

Reconcile your bank account and ensure that your ending balances match the last statements covering the fiscal year. If there are any outstanding cheques that did not clear the bank, review that they are not stale-dated and adjust before preparing your reports.

Prepare Your Reports

At your fiscal year-end, you’ll want to prepare some reports for your accountant.
Some of these reports include:

  • Income Statement (covering your fiscal year)
  • Balance Sheet (last date of your fiscal year)
  • Trial Balance (last date of your fiscal year)
  • Current Accounts Payable record
  • Current Accounts Receivable record 
  • Mileage Log
  • Sales Tax Summary (cover the last filing of the year) 
  • Loan details with balances 
  • Petty Cash records
  • Bank and Credit Card Statements (covering the fiscal year dates)

Upon generating reports and providing a backup of your accounting software to your accountant, be sure to close the books. No additional entries should be made. Your accountant may have year-end entries for you to add upon completion of your small business tax filing. 

For more, check out the Indigo Year-End Checklist here.

If you spent most of 2022 feeling overwhelmed and burnt out from managing your business, it’s time to think about hiring someone to complete your bookkeeping for 2023.

Contact Indigo to see if we’re a good fit for your business! ?? 

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