Getting Ready for End of Year Accounting

Want create site? Find Free WordPress Themes and plugins.

Time flies so fast- it seems like only just yesterday we were having great times enjoying our holiday vacation for the new year.  Now, we are back to reality, having to face the challenges of keeping our business transactions up to date and preparing to do the year-end procedures for accounting.  One or few of the following activities in the list may or may not apply to your business so just go through the activities that apply to your business operations:

Financial Fiscal Tax Year End on Gold Coins

  1. Go over your monthly task checklist

If you are able to make your monthly task checklist, then it is easy for you to monitor how you are going with the update of the monthly routine accounting tasks, sorting between tasks that are completed and tasks that are pending.  If you are not able to make a complete list of your monthly tasks, it is best you begin creating the checklist immediately, most preferably at the start of the new accounting year to keep you on track.

 2. Update the recording of your business transactions

 This includes making sure all December, 2015 transactions are properly and accurately recorded – customer invoices and sales, supplier deliveries, invoices and payables, recording of customer payments, disbursements for supplier payments, employees’ reimbursable expenses, petty cash fund and other fund replenishments, monthly periodic accruals and other accounts are up to date (December 31, 2015).  If you have your monthly recurring tasks checklist then go over this and see if you have missed out anything.

  1. Review your Profit and Loss statements

 If your accounting system is able to do a comparative monthly Profit and Loss statement then, this will work better.  MYOB has built-in reports that deliver this type of financial report for you.  Having to look at comparative monthly results of business operations make it easier for you to evaluate and analyze how the business is going.  It is also a useful tool to accounts erroneously posted to another as well as omissions in recording.

  1. Conduct year-end physical inventory count

If you are a trading business or engaged in buy and sell business, then it is very important to conduct an end-of-year physical count of your goods inventory.  If you are engaged in manufacturing, it is best you conduct the count from raw materials, goods in process and finished goods.  This is regardless if you are using the periodic inventory or the perpetual inventory system for inventory tracking.  In MYOB, you can compute for the inventory variance – whether shortage or overage by simply inputting your physical count result into MYOB. Inventory adjustments are automatically prepared at your option.

  1. Review your Balance Sheet

 First and foremost, watch out for negative balances on assets, liabilities or capital and equity accounts. Most often, negative balances on balance sheet accounts are caused by error in accounts used in recording transactions.

  1. Update your accounts reconciliation including bank accounts

 You would need to ensure that you have done most updated cash in bank reconciliation and that all items needing adjustments are recorded in the books.  In case of stale checks, be sure to recognize the liability accounts due to the supplier or previous payee and reverse the cash in bank account or you would need to issue new check disbursement on the new accounting period.  You also have to reconcile other cash accounts – Cash on Hand, Petty cash fund and other operating funds, Cheque on hand and other accounts.

  1. Review Accounts Receivable Aging Report

 Reviewing the accounts receivable aging is very helpful to ascertain a more realistic provision for doubtful accounts. With this, you would need to decrease or increase the previously recognized doubtful accounts expense.

  1. Review Accounts Payable Aging Report and Reconcile

 Reviewing the accounts payable aging report bring about numerous benefits as it is very useful in evaluating company performance to pay suppliers’ invoice on time. It is also a good tool to evaluate and resolve potential conflicts like unpaid accounts receivable due to the company or unresolved discount, delivery disputes.  Aside from this, you can also be able to properly schedule and allocate cash allocations for supplier payments if you have tight cash budget requirements due to capital acquisitions or substantial loan payment to make.

Take note the process above may or may not be complete according to the abundance of unique business operations. However, the above process complements each other with the effort to produce a more accurate and realistic business operation result and financial standing.

Did you find apk for android? You can find new Free Android Games and apps.

You may also like