While planning for financial year end is a pain for every small business, good planning will set you up to start the new year on good footing. If you are a little confused about where to start, have a look at our financial year end survival kit.
1. Sit down with your bookkeeper, accountant and/or financial advisor
The first step is to understand exactly where your business is in terms of finances. Make sure to sit down with all the people who handle your finances. Make sure they know exactly what they need to prepare ahead of the new financial year.
2. Make sure you are tax ready
One of the most important things for your business is making sure you know exactly how much tax you need to pay and if you qualify for a rebate. Check the SARS website for any information you need. You can also do your tax returns online. If you require an extension, make sure to communicate that with SARS beforehand. Also check up on any tax changes that will take place in the next cycle.
3. Pay your debts
Make sure you have settled all your payments to vendors and contractors before the new financial year. Also, try to close off any outstanding money from your debtors so you can start the new year on a clean slate.
4. Consult your balance sheet
Look at your balance sheet from the past year and look at where you did well, where you didn't and set goals for the new financial year. Start making forecasts and adjustments for the coming year. It is also important that you share this information with the relevant stakeholders so that everyone is on the same page about business performance.
5. Review employee details
Make sure your payroll and employee details are updated. Also make sure that past employees have been removed from the business server and email systems. It is critical that you make sure you have concluded any outstanding employee contracts so that your books accurately reflect what is happening in your business.
6. Review your business insurance
Your business may have expanded or downsized in the last year, make sure your insurance cover is still adequate for your business needs.
7. Back up all important data
The end of year is a good time to make sure all your important information is backed up. This is as easy as saving your documents in your google drive or in the cloud. If you are still a little old school, maybe its simply transferring them to a hard drive offsite.
8. Check your website
While you are preparing your finances for the new year, use this time to check your website as well. Do all the links work? Is the business telephone number still active? As we know, the first impression most people will have of your business is your website. Just take a little time to focus on the details.
9. Decide on employee bonus payments
While you are planning your finances, decide if/ how much you are going to give your employees for their bonuses. Make sure you take tax into account and add it to your projections.
10. Compile a report
Compile a detailed report of where the business is, how it has performed over the past year and plans going forward. This is less about finances but more about goal setting and making sure that your employees and other interested parties feel that they are part of the journey. Present this report to your employees and encourage them to engage and make suggestions.