Year-End Checklist for Small Business Owners
One challenge for small business owners is to assure a strong year-end. A survey by Office Depot resulted in 32 percent of small and midsize businesses owners stating their main concern during the holidays and end of the year was cash flow. Specifically, to have the financial resources to insure profit and success.
There are several steps you can take to make the end of the year a success and get the new year off to a good start.
A complete financial accounting of your business will show your current financial standing and allow comparison with previous years. This would include a profit and loss statement, balance sheet and cash flow report. The profit and loss statement will not only show where you are for the year, it its will also give you an idea of what to expect in the coming year.
Analyzing your cash flow for the year will give you the best idea of where you money is being spent. Three important areas to consider are:
1. Operating expenses – incoming revenue and outgoing expenses.
2. Investments – this includes inventory and equipment, amount purchased and sold.
3. Financial Debt – loans and outgoing payments made on behalf of the business.
It is important to reconcile accounts receivable at year-end. Print a list of outstanding invoices for work completed. Collecting amounts due will help with cash flow and allow you to begin the new year with a clean slate.
Update your vendor list. Confirm contact information is correct on all current vendors and determine if they are profitable for you. Purge files that are no longer active and delete any incorrect information. In addition, back up all contacts and other important information. Make sure your client’s information is secure.
Inventory is especially critical. Be sure you are keeping accurate records. Investigate discrepancies and make sure you are not a victim of internal loss.
Payroll and benefits need to be re-evaluated. Make sure taxable benefits are accounted for, such as health insurance and transportation benefits. Consider salaries and time off and make sure they are appropriate. Many employers forget to include benefits like health insurance or transportation benefits as part of the salary. Make sure the salary and benefits are appropriate, including paid time off. Update policies and be sure all employees are aware of new policies and changes in benefits. Be sure your employees are aware of the fringe benefits and total salary.
Many business owners worry about keeping employees on track and completing reports and other necessary year-end tasks. Meeting with employees and coming up with a strategy will help maintain momentum and get things done right and in a timely manner.
Evaluate employees and determine if they are necessary and are an asset. Make plans to eliminate employees who are not benefitting the business.
Meet with your staff and share the positive things that have occurred during the year. Discuss goals that have been met and those that have not. Set new goals for the coming year and discuss any changes that need to be made.
All of these will make your year-end smooth sailing and you can enjoy the holidays knowing you are ready for the new year.