Having your business goals and ideas planned beforehand helps in making your business successful. Apart from goal planning, having an updated financial statement and books of accounts is equally important. Updated books of accounts help you to analyze your business’s financial standing and help you make sound decisions. With the end of the year approaching soon, it is time to look into some important accounting to-dos.
1) Manage your Payroll and Bonus
Ensure that you are up-to-date with all payroll regulations. Have the company payroll calculations ready and decide if any increment, bonus, or reward has to be added. Additionally, plan for taxation as a bonus is subject to Canada Pension (CPP) and Employment Insurance (EI) with one exception – if the employee has contributed maximum early amounts for CPP and EI, there are no deductions made.
2) Prepare for an Internal Audit
Keep a record of your balance sheet and profit and loss report ready and updated so that you are aware of where your business stands. An income statement helps you analyze your expenditure and savings and helps you plan for your future goals accordingly. Also, keep a track of the cash that has been utilized for payment and how much cash you are left with in hand.
3) Pay your Bills and Receive the Payments
With the year ending, it is vital that you clear any payment that you still have to make instead of carrying it forward to the next year. Similarly, it is also important to try and get all the pending payments of your company to finalize your accounts. Always try to start the new year with a clean slate. Well, as clean as you can get it at least!
4) Update Tax Records
Maintaining a record of the tax the company has already paid helps you to recognize how much tax amount is pending. It also helps you to figure out what amount needs to be paid before the financial year-end. In case you face an issue in paying annual taxes, opt for making quarterly tax payments. Paying taxes in installments reduces the burden when the year end is near.
5) Talk to your Accountant
Often, many accounting concepts could be difficult for you to understand. Lacking the expertise could lead to last-minute mistakes. To avoid this, do not take matters into your hands. Have your trusted accountant finalize your accounts and check for missing entries. Also, sit with your accountant to plan your future financial goals.
Maintaining your books of accounts is an ongoing process and not something you sit to work on at the end of the year. Before the year-end approaches, you simply need to be working on minimal pending accounting entries along with your chartered professional accountant. So if you don’t have an accountant, hire one from the best of accounting firms in Edmonton.