For a lot of business owners, December 31st is their fiscal year end, which means that in January, the bottle of Advil, Tylenol or Aspirin is close at hand. Although it is the end of your fiscal year and the start of a new one, there shouldn’t be a great deal of extra work in closing off your year. Typically, year-end is a daunting process only if you haven’t been able to stay on top of your bookkeeping.
One of the things that we have introduced at AIS Solutions for our bookkeeping clients is a year-end package, which we put together for their accountant. We have had great feedback from the CA’s we’ve sent we’ve prepared this for. The more organized your documentation is to your CA, the lower your fees should also be.
Here is a short checklist of things that you will want to ensure are completed before you submit your books to your Accountant.
- Last Reconciliation of the Year for Bank accounts, investment accounts or credit cards
- Review your Fixed Asset or Capital Asset Purchases and put together copies of these purchases for your CA
- Review the account which captures any Shareholder Loans or Owner Draws to ensure that they are accurate
- Review your final HST Return and Source Deduction Remittances to tie them into Statements Received from CRA
- Review your Revenue, Profit Margins and Expenses compared to last year. Sometimes this is a great way to flag any expenses or revenues that you may have missed
- Translate Foreign Accounts to recognize Gains/Losses
As you can see from the list above, most of the information is reviewing what should be entered on a weekly or monthly basis. The pain relief medication generally needs to come out when before any of the above can happen, you first have to enter receipts or invoices for the last six months. It is also when you mass enter documents trying to meet deadlines that mistakes happen and expenses get missed. Worst case scenario is that you are so far behind that you file your tax returns late and end up having to pay interest and penalties. I heard a CA refer to this as “Voluntary Tax”, which is basically tax that you don’t have to pay to CRA but are choosing to pay
Year end can be a breeze with a little organization throughout the year, and staying on top of your bookkeeping tasks. If you can’t manage it all yourself, or are sitting down for days or weeks at the end of the year to catch up, then you should seriously consider hiring a bookkeeper to do it for you. Because wouldn’t you rather be having a glass of wine, rather than a glass of water and Advil?
I would love to hear of ways you make your year end an easier process.