The beginning of April sees the financial year end for most businesses. It should be a time to look at the financial performance of the previous year and plan for the forthcoming year.
Unfortunately, because the deadline for tax returns is still 10 months hence, many business owners do not review their previous year’s performance for at least another 6 months – far too late for planning your cash flow.
You should have a good grasp of your income and expenditure for 2014/15 by mid April. With good record-keeping you should have all your income and expenses at your finger tips so that there’s no need to give your accountant a shoe box full of receipts for them to record.
Here are the Cloud 9 Admin tips on preparing you figures for the financial year end:
Use an online accounting system such as Freshbooks, Xero or Sage. These will pull in your expenses from your bank account and your credit card account. Use a smart phone app to scan in your cash receipts and add them directly to your accounting system.
If you’re a small enough business, a well planned out spreadsheet is just as good as an online accounting system.
Download online receipts each month on to your computer or your accounting system – some companies do not keep the invoices after a certain amount of time. If you stop using a company (particularly change mobile phone provider) you may not be able to access the receipts online for your records.
Go through your diary and record your mileage onto a spreadsheet on a monthly basis – if you have forgotten to record a venue in your diary it is much easier to remember details after 30 days than after 10 months!
Keep a record of reconciled bank statements
Keep a record of all standing orders– you may not have a receipt for your insurance cover, but you will have a policy that states your payment schedule.
Keep a record of all loan repayment schedules
Set regular times for sending out invoices – it could be weekly or monthly.
Set up a system for chasing payment of invoices.
If you are paid on commission set up a system to track commission payments.
If you organise your finances in this way, you will always have your finances at your finger tips. You may be able to reduce accountancy costs, because there will be less work for them to do and you will certainly be able to plan your cash flow for the year ahead.
Most business owners do not enjoy keeping their financial records up to date and often do not prioritise it. If that is your situation, give us a call at Cloud 9 Admin to find out how we can assist