Financial year-end can often be a stressful and is a very busy time for companies, as each department gathers their reports and statements, in order to complete the financial year-end successfully.
In order for a smooth process you need to start early and check that your company has records, reports and statements for the following:
- Bank statements: all business related accounts and make sure they have been reconciled
- Cash control: Record of cash on hand
- Accounts receivable (debtors): Ensure that all payments from clients have been processed by the year-end
- Accounts payable (creditors): Ensure all delivered goods and payments made to the supplier have been captured. You should have a statement from every supplier.
- Accruals and provisions:
– Accruals should only include amounts which may be charged to the business at a later date, for work done in respect of the current financial year e.g. accounting and audit fees.
– Provisions should only include amounts which are due by the business at year-end but may not necessarily be paid out in the coming year e.g. leave pay and staff bonuses.
- Control accounts – there are usually two types:
– Payroll controls
– VAT controls
- Loans: Interest-bearing, non-interest-bearing and current portion.
- Fixed assets: A register of fixed assets is a statutory requirement for all private companies and close corporations. It is also good practice for trusts and sole proprietors to keep this register.
- Stock take: Physical count of stock, the value of the stock and that cost price is reasonably correct. Consider devaluing or writing-off slow-moving or obsolete stock.
- Expenses: Check that there are 12 entries for all regular monthly expenses. Check that no capital expenditure has been included.
Get in touch with Professional Accountants for assistance in closing the books on your financial year-end.