Accountants Struggle with Year End Reports
We all know the end of the year, financial year and tax year are busy seasons for most accountants. This year in particular, facing year end reports appears to be more demanding because of the pandemic.
Unlike the past years, 2020 brought the additional work of specifying how the company’s cash flow was allocated during the lockdown period – while balancing the preparation and review of balance sheets and income statements.
And because this accounting period is crucial in knowing how your business did the past year and in determining the right amount of tax to be paid while avoiding penalties, we’ve provided four ways to lessen the struggle year-end reports bring.
Ways to Lessen the Struggle of Year End Reports
Use a detailed checklist
As the year comes to an end, gathering paperwork, forms, statements, and other supplementary documents is a handful. By utilising a year-end checklist that captures all the required files – it allows you to have a glimpse of the ones you have currently accomplished and the ones that have yet to be complete.
Preparation truly is key when trying to take the edge off gathering all the necessary files to make an accurate and transparent annual report. When it’s time to conduct your analysis, forecasting, and reviews – getting it done will be effortless knowing you have every item ticked off your checklist.
Collect overdue payments
The only way to conclude your financial statements is by collecting all payments owed from customers and clients. Out of balance books are issues needed to be addressed urgently – because even the smallest gaps and imprecision can cause havoc on your report.
Getting all pending transactions closed to avoid last-minute chaos when it’s tax return time is the goal. To help you chase overdue payments and avoid additional holding time – use a payment transaction app like Ordo to instantly reconcile payments received, and know at a glance which ones are yet to be received. Time is ticking and the sooner overdue payments are processed – the sooner you can close the books.
Monitor current and future effects of COVID-19 on reports
The reports give you a glance of the current year’s financial standing, but isolating the effects COVID-19 has had on the business can bring preparedness for future effects on the business. Undertaking this task can result in a sense of understanding, having measured all losses and recent changes, giving a semblance of a sense of control at a time when we are able to control little.
60% of potential financial impairments are from COVID. The significant impact the pandemic has brought to many businesses must be reflected accurately in year end reports. Let’s not forget about the monitoring of new accounting standards for the year to ensure all statements are valid.
Simplify and sort out expenses
Organise all receipts, outflow, VAT returns, debts, and bills in an efficient manner. Improving your sorting process makes it easier for searching and going back to when reviewing the balance sheet.
A big error to avoid in preparing financial statements is misclassifying supplementary documents to back up your final report. When you simplify and sort out all expenses, it eliminates the possibility of inaccurate reports. Thus, verifying records from bank accounts to your accounting records will become less of a hassle once everything is in order.
Make your year end struggle-free
Preparations for year-end reports promises to be even more of a challenge this year. With the right planning and preparation, achieving and completing your year end report can be as seamless as possible. Employ ways to help yourself and your company reduce the burden of financial reporting. Find out more about how Ordo can help you chase overdue payments to conclude the balance sheet, income statement, and cash flow statement.
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