Get the bookkeeping in order before the turn of the year

The rest of the year often comes faster than the entrepreneur has time to think about. Before Christmas, it’s a good idea to take a moment to review the company’s financial situation. By checking things off on time, there’s less to do in December and the financial statements are easier to prepare.

At the same time, you might notice if something still needs attention. Is the company's profit what you expected? Are the taxes at the right level? Are you getting enough information about the financial situation of your company?

1. Is the accounting up to date?

During the year, invoices, bills, and other documents accumulate; it can easily be forgotten to submit them. Before the end of the year, it is advisable to check that all necessary information is available from the accounting system.

Go through at least the following:

• Have you also submitted receipts for purchases from companies that you have paid for with your own card?
• Have the travel and expenses bills been submitted?
• Has all the sales been invoiced?
• Has care been taken of open purchase invoices?

 

When the receipts and invoices are in order, you also get a more reliable picture of the company’s finances. At the same time, you avoid the situation where you have to search for old invoices in a hurry just when the financial statements should already be prepared.

2. Do you know what kind of result your company has ended up with?

A company's results may be completely different from what was estimated at the beginning of the year. Therefore, before the year-end, it is worth checking how much the company has generated profits and what the final year will look like.

Just the balance in a bank account does not tell the whole truth. There may be money in the account that is needed for VAT, advance taxes or other payments soon. On the other hand, unpaid invoices by customers affect how much money is coming into the company.

Advance tax should also be checked. If the company's profit shows that it will be significantly lower than estimated or that it will grow larger than expected, it may be worth considering changing the advance tax.

When you know what kind of outcome your company is facing, you can prepare for possible tax penalties and future expenses. At the same time, you will notice in time if sales have not developed as expected or expenses have increased too much.

3. What else needs to be clarified for the financial statements?

Preparing financial statements requires more than just the year’s income and expenses. The information needed depends on the company’s operations, so it’s worth reviewing it already in the fall.

For example, the following things may require attention:

• Warehouse: If your company has products or materials in stock, the quantity and value of these must be determined for the financial statements.
• Larger purchases: Have you purchased, for example, machines or equipment for which the accounting processing needs to be verified?
• Open invoices: Are there old sales receivables that need to be followed up or whose collection needs to be continued?
• Payroll calculation: If your company has employees, the salary data and information related to leave allowances must be in order.

 

If you are planning to make larger purchases for the rest of the year, it is worth examining their impact on the company's finances and accounting before making a decision. It is a good idea to make the purchase based on the company's actual needs, not just because of the potential tax benefits.

The earlier the missing information is found, the easier the financial statement process will proceed. You can already reduce the rush in the final quarter by going through your company’s acquisitions, open invoices, and other matters that affect the financial statement in good time.

4. Is your company’s bookkeeping in order?

Accounting should make the entrepreneur’s life easier and help them understand the financial situation of the company. If accounting takes a lot of time, the figures remain unclear, or you’re not sure that all obligations are being met on time, the current arrangement should be reviewed.

Consider, for example, these questions:

• Do you know where your company's finances are going?
• Are the bookkeeping and tax returns being done on time?
• Do you get help when you need it?
• Are the costs of accounting transparent?

 

The turn of the year is a good time to get your company's financial affairs in order. If the current way of managing accounting no longer serves your needs, it may be time to consider other options.

5. Is next year's finances planned?

As the year that has passed begins to wrap up, it’s worth taking a look at the future as well. Are your company planning any new acquisitions, hiring of employees, or other changes that will affect the finances?

Make at least a rough estimate of next year's income and expenses. At the same time, consider how much money is needed to cover ordinary expenses, taxes, and potential investments.

The plan doesn’t have to be complicated. Just estimating the revenues, expenses, and larger purchases for the coming year helps to understand where the company’s money is enough for and what changes should be prepared for. This way, the new year begins with a clearer understanding of where your company is headed.

Quick checklist for the turn of the year

Before the year ends, it is worth making sure that the following things are in order:

• All necessary documents have been submitted to the accounting department.
• Sales invoices and open purchase invoices have been reviewed.
• The company's profit and the amount of advance taxes have been revised.
• The information related to the warehouse and larger purchases is in order.
• Salary and holiday pay data have been checked if necessary.
• The company's financial situation is clear.
• The most important expenses and plans for next year have been reviewed.

 

Do you need clarity regarding your company's financial matters?

Accounting should make the entrepreneur’s life easier and help them understand how the business is doing. If financial matters remain unclear or the current service does not meet their needs, it’s worth looking for a solution.

Konkretia Accounting offers accounting and payroll services with clear pricing without hidden costs. The goal is for your company's financial affairs to remain organized and for you to have a better understanding of where your company's finances are headed.

Do you want to discuss the accounting of your company or are you considering changing accountants? Contact Konkretia Accounting and we will discuss what kind of solution would be suitable for your company.