This is it, there are just two weeks left until the new year, and I want to know, are your books in order? I know, corporate taxes aren’t due until March, but you shouldn’t wait until then to make sure your company is financially on the right foot.
I know this is the time of year, we all think about holiday parties, holiday shopping and taking some time off to spend with the family. But before you do all that, the most important thing to do for your business is to make sure your company’s books are in order.
Over the last month, I have gotten several panicked phone calls from now new clients or potential clients to ask if we could help them with their disorganized books. Some of the business owners admit their books are in disarray because they just haven’t been able to keep up. Others tell us that their in-house bookkeeper can’t give them a straight answer about their finances. Those are big warning signs that you need help. Here are some of the things that you or your bookkeeper should have completed by the end of the year:
- RECONCILE YOUR MONTHLY CHARGES – Are your credit card statements in order? Have you reconciled your monthly charges? If you have a bookkeeper or accountant, now is the time to ask him or her if this has been done. If you are doing your own books, don’t wait until the start of the year to do this, use the holiday downtime to do it now
- DOUBLE CHECK OR ADJUST YOUR ENTRIES – The end of the year is a good time to double check that your income statements are correct, that your cash flow has been reported correctly and it’s a great time to double check that all of your transactions have been categorized and logged properly. If not, adjust your numbers and make sure your entries balance out.
- CALCULATE ANY FUTURE CHARGES – Making sure your books are closed is also important because it lets you calculate if you might be carrying balances over to the following year. You can input those future charges into a fresh financial report for 2017. This will help your bookkeeper correctly calculate your balance sheet, cash flow statements and profit and loss statements. It will also help your accountant correctly figure out the amount you owe the IRS without overpaying.
If your office phone call volume is starting to slow down for the holidays, then now is the time to catch up or review your books. If you don’t do your books yourself, then set up a meeting with your bookkeeper and ask if your books are complete for 2016 and if he or she has a 2017 projection for your company’s financial health. If your bookkeeper says he or she doesn’t have the time to meet or can’t share your company’s information, this could be an indication of bookkeeping issues. Call or email me and I will review your books for you.
By the way, this will be my last newsletter of 2016. I want to thank all of you for reading my blog and sharing your time and your stories with me. I hope 2016 was a wonderful year for you, your family and your business and I wish you a very Merry Christmas or Happy Hanukkah and a Happy New Year!
