End-of-Year Checklist for Business Owners

The fourth quarter is in full swing and will be over before you know it! This time of the year usually has people thinking about wrapping presents. However, for business owners, it’s prime for wrapping up any tasks you need to finish and preparing for the coming year. 

As you begin to analyze your company’s performance over the past year, check these tasks off your to-do list to ensure you’re financially stable and ready to take on the new year. 

Organize & Review Expense Records 

Gather all financial and other essential documents required to analyze your business standing. Review this information to gain a general idea of how your business performed in the past year and project its performance for the upcoming year. 

You can make this process even easier by organizing your documents by category. Whether you choose to manage your files physically or electronically, you can create folders for financial records, tax statements, receipts, licenses & certifications, and any other relevant categories. 

Assess Inventory 

Perform an inventory assessment to determine how much of your company’s capital is tied up in inventory. In other words, how much of your business funds are sitting on the shelves as stock, and how much is liquid and readily accessible to use for other expenses?

You can also take inventory of your office equipment and supplies to identify which items you’ll need to repurchase soon. This step will help you budget accordingly for the coming year or use any surplus funds to purchase needed items now. 

Review Liabilities 

Analyze your company’s current and long-term debts and liabilities, such as business loans, commercial credit cards, vendor or supplier contracts, and other accounts payable. Finding ways to manage debt efficiently will help keep your company in a solid financial position.

Refinancing business loans or transferring high-interest credit card balances to the credit union might offer substantial savings and provide more flexible repayment options. 

Analyze Profitability 

Study your company’s Profit & Loss (P&L) statements to analyze profitability. These statements show your business income and expenses. Analyzing these records can allow you to identify trends in both areas and make any necessary adjustments for the coming year. For example, you might find that you’re overspending in a particular area and can commit to cutting costs next year.

With expenses continuing to remain high, consider using previous months’ expenses to create a more accurate budget for next year. Remember, it’s always wise to overestimate costs and not need the funds rather than underestimate and borrow to make ends meet.

Evaluate & Update Your Business Plan 

As you review your financial reports from the past year and crunch the numbers, you may notice recurring patterns and trends. If you experienced a season with exceptional profits, you could aim to replicate it in the upcoming year. Conversely, if you identified a particular period with lower revenue, you could develop strategies to combat this cycle in the future. Use the data from current and previous years to help you outline your plan for the new year. 

Prepare Tax Documents 

It’s never a bad idea to get a head start on tax season! While you’re gathering other business documents for review, you can also collect any additional documents and information that you know you’ll need for tax time. You can start preparing now for the upcoming tax season by organizing your receipts and other documents necessary when the time comes to file. 

Taking the time to complete this end-of-year checklist can help set your business up for success in the coming year and beyond. You can gain valuable insights into the performance of your business and set attainable goals for the future. 

If you want to learn more about our financial products and services tailored to small businesses, we’re ready to help. Please stop by any branch location or call 248-322-9800 extension 5 to speak with a team member today.

 

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