Year-End Bookkeeping Checklist for Small Businesses
As the year draws to a close, many business owners start to panic after realizing how far behind they are in their company’s recordkeeping. Using a year-end checklist can help keep your business on track and prevent last-minute stress just when you want to spend time with friends and family. Plus, a proactive evaluation of your finances at the end of the year can help you make good decisions and plan for the upcoming year. So get started today with our year-end bookkeeping checklist for small businesses!
Use the checklist below and keep reading for more information about each step in the list. Please feel free to share on your website or social media!
1. Check for Outstanding Bills and Invoices
Look to see if you have any outstanding vendor bills so you know how much you still owe. Similarly, check for any remaining customer invoices to find out what you are owed and ensure you receive payment. Depending on your particular situation, you may want to push to collect on open invoices or pay promptly before the end of the year.
2. Review Expenses and Assets
Go through your books and double-check any transaction marked as an expense. If its usefulness to your company extends beyond a year and it cost at least $1,000, then it likely should be reclassified as an asset. Before you start, make sure you’re clear about how your company classifies expenses and assets, in particular making sure you have a policy about purchases below $2,500.
3. Reconcile All Accounts
Reconcile all of your company’s accounts to ensure their balances are accurate. This should include any company bank accounts, credit card accounts, payroll accounts, loans, lines of credit, and any other business accounts you may have.
4. Prepare to File Form W-2s for Employees
If you have payroll, make sure you possess the information you need to fill out your Form W-2s for employees. In particular, check that you have accurate mailing addresses and tax IDs on file for each of your employees.
5. Prepare to File Form 1099s for Vendors
If you have enlisted the services of one or more independent contractors, you should determine whether you need to file Form 1099s for them or not. Any independent contractor who is not considered a corporation and who you have paid (or will pay) at least $600 this year will require you to file a Form 1099-MISC. Fortunately, you can use the information from a contractor’s Form W-9 to fill out their Form 1099, so check your records to ensure you have accurate W-9s for any contractors who will require you to fill out a 1099. The deadline to file is January 31st, so start collecting this information before the year is over to avoid any last-minute stress.
6. Update Inventory Before the Holidays
Confirm your inventory count so you know exactly what is still available. To ensure accuracy, you may want to physically review your inventory rather than rely on previous recordkeeping. Make any adjustments needed to your books so you can start the holiday season off right with up-to-date records.
7. Start Planning for the New Year
Last on your year-end bookkeeping checklist should be planning ahead for the New Year. From finding ways to improve your cash flow to maintaining better books and strategizing ways to grow your business, the best way to hit the ground running in the New Year is to identify any problems you’re experiencing, set new goals, and outline the steps you should take to put you on the path to success.
Need Help? Contact Tower Books with Your Year-End Bookkeeping Checklist
Overwhelmed by this list or know that you want better books in 2019? Tower Books can help! We can get you caught up for 2018 or start fresh in 2019. Contact us today to set up a free consultation and get started.
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