End of the Year Preparation for Small Business

Keeping your financial records in order is hugely important to the success of your business. Not only does it keep you up-to-date on your profits and losses, it helps you to have your records straight. It makes the close of your fiscal year easy to execute by ensuring that all of your required statements are in the right place. This is especially important for dealing with the IRS. Understanding just what exactly goes into a fiscal year close can be confusing, though, especially for new business owners. Even if you have an accountant on staff or retainer, it’s still important to keep track of your finances yourself. It just makes good business sense for you, as the owner, to understand what exactly is happening with your money.

I did a little research on the web and came up with the five most important things you need to do now to finish the year strong and be ready for 2017. 1) Review your profit and loss statements. Your business’ profit and loss statements will help you get a really good look at its financial performance for the year. You can see what your revenue looks like now that the year is almost through. It helps you to anticipate any other large expenses that might hit your books. This way you can evaluate how much money you have available for this year and see if it might be wise to make a larger purchase before the end of the year so that the item can depreciate. 2) Verify Your “Vendor and Lender Files.” It’s important to review the paperwork – including 1099s –associated with any of your vendors, as well as information relating to any current outstanding loans. Make sure all of your vendor 1099 forms are up-to-date and accurate and make sure the 1099 information has been input correctly into your accounting system so that it’ll populate the forms when printed. 3) Take Inventory. If you sell products, conduct an inventory assessment and compare the results to your last inventory report. Make any necessary adjustments so that you have an accurate account of how much capital you have wrapped up in your current inventory. Even if you don’t sell products, it’s not a bad idea to take an inventory of elements in your office, such as equipment, computers, office supplies, etc. Make a list of any broken equipment or equipment in need of repair. If you lease any electronics, such as copiers, pull out the contract associated with it and make sure the terms are still appropriate for your situation. 4) Look for Benefits to Report on Your Outgoing W-2. As a business that issues W-2s, these benefits relate to the organization as a whole and can reflect things such as health and life insurance, transportation subsidies, educational reimbursement programs and more. And #5! The most important one: Create a Budget for the Following Year. It’s never too early to plan. By reviewing your statements from the current year, you’ll start to see a pattern for the things you need to budget for and plan for in the next year. By taking stock of your expenditures from the current year, you’ll have a better understanding of where to focus your efforts moving forward.

Finally, here is one important step you need to do on the first day of you new fiscal year: Print and mail out all your tax forms. If your fiscal year coincides with the calendar year, you must print and mail certain forms by a certain time. If your fiscal year doesn’t coincide with the calendar year, some of these deadlines may still apply, so be sure to double-check with your accountant including 1099s, 1096, and all payroll forms. The end of the fiscal year is a crazy time for any business, but smaller businesses feel the pinch even more due to limited staffing and skill-set availability. Prepare yourself and make sure to cross off all of the steps necessary for a successful and responsible end of your fiscal year.

Montrose-Verdugo City Chamber of Commerce: Your source for all things local! Our mission is to actively support and enrich the community, vitality and pride of Montrose, to help preserve the historic district and small town atmosphere, to promote economic stability and positive, productive relationships within Montrose and the surrounding communities.
Upcoming Events
Montrose Christmas Parade on Saturday, Dec. 3 at 6 p.m. sharp in the 2200, 2300 & 2400 blocks of Honolulu Avenue in Montrose.
December business mixer on Wednesday, Dec. 7 from 6 p.m. to 8 p.m. at Boulevard 34, 3427 Ocean View Blvd., Montrose.

  melinda clarke