Many business owners find themselves juggling multiple tasks at the end of the year as they try to close out their financials. Asking the right end-of-year (EOY) questions can reduce stress, help clean up their books, and even uncover tax savings. Here are ten questions that will help business owners finish out the year strong:
1. Am I Missing Any Debt?
Verify any debt or financed purchases are properly recorded, including deductible interest payments.
2. Do I Have Any Errors in My General Ledger (GL) Accounts?
Reviewing the general ledger helps spot errors that could lead to missed deductions or unrecorded transactions.
3. Should I Make Any Year-End Purchases?
Making strategic year-end purchases can reduce taxable income, especially for businesses expecting a profitable year.
4. Have I Recorded All Credit Card Purchases?
Capturing all credit card transactions ensures all expenses are accounted for, avoiding missed deductions.
5. Have I Included All Payroll Benefits for the Year?
Review payroll benefits like bonuses and retirement contributions to avoid later complications with tax filings.
6. Did I Dispose of Any Assets?
Review asset disposals or sales and consider the tax implications, including write-offs or income from sales.
7. Have I Included All Unpaid Bills?
Missed deductions can occur if unpaid bills are not properly recorded in accounts payable before year-end.
8. Do I Have Any Old or Obsolete Inventory?
Writing off old or obsolete inventory frees up storage space and eliminates unnecessary insurance costs.
9. Can I Collect My Open Receivables?
Uncollectible receivables can be written off, helping to clean up the books and avoid paying taxes on revenues you won’t receive.
10. Are My Bank Accounts Current?
Reconciling bank accounts is crucial to avoid missing deductions and ensure accurate financial records.
Taking action on these questions can significantly benefit your business. A thorough year-end review not only prepares you for tax season but also ensures your financials are in order. Proactively addressing these areas empowers you to close out the year with confidence. Consider reaching out to our professional accounting firm for guidance and support.
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