ACK Bookkeeping Services

Year-End Preparation Kit

We are entering the final days of the 2012 financial year and there are a number of key areas where careful consideration and planning can assist in managing year-end tax obligations and providing you with information, checklists and tips you need to start the new financial year in the best possible shape. Now is an opportunity for business owners to review the current financial year and proactively approach the next.

Those who take action now to review their systems, processes and software are more prepared to hit the ground running on 1 July, placing their business ahead of its competition.

1.    EOFY Tips and Information

2.    Payroll Year-End Checklist

3.    EOFY Checklist

  1.    EOFY Tips & Information

·       Keep you financial records up to date. Identifying errors is much easier over a short time period than after 12 months’ time has passed, so perhaps review your books every week or month rather than every quarter. Mistakes can be picked up sooner, potentially saving you money in the long term. If you don’t have the time to do this and would rather invest time in working on your business rather than in your business, hire a professional bookkeeper. This ensures less stress and time to prepare your accounts, reducing costs of administrative tasks that your accountant may have had to do at a higher rate. Therefore saving you time and money.

·       Timing issues. The benefits of deferring assessable income or bringing forward deductions will depend on the circumstances of each business and their overall anticipated tax position in the current and future income years. The following are common deductions that can be brought forward:

ü  Interest

ü  Bonuses

ü  Directors Fees

ü  Training

ü  Development

ü  FBT June quarter installment

ü  Superannuation (must be paid before 30 June not merely incurred)

Please consider your cash flow position before any expenditure is brought forward or income deferred.

·       Write off bad debts before 30 June.

     Write off any outstanding debts that are 12 months or older and/or are considered non-  recoverable. Remember to claim back any GST.  

·       Trading Stock.

An accurate stock take must be undertaken at the end of the financial year. Any obsolete or damaged stock is able to be written off. 

·       Plant & equipment

Review the depreciation schedule and match to plant and equipment on hand. Account for additional depreciation deductions or write off assets that are obsolete or have been disposed of. This should be undertaken at the end of the financial year in conjunction with the stock take. Consider holding off buying business assets until the new financial year, because the instant asset write-off increases from $1,000 to $6,500 from 1 July 2012.  

·       Ensure your BAS and superannuation guarantee charge statements are lodged and paid by 28 July. Make sure to pay your superannuation guarantee contributions for the fourth quarter of 2012 by 28 July 2012. If you or you miss this deadline, you must submit a Superannuation Guarantee charge statement to the ATO. 

The following checklists are mainly based on the use of MYOB software but most of these would still apply to any business. 

   2.    Payroll Year-End Checklist

 

¨  Ensure that you have entered all wages to 30 June 2012

¨  Print key payroll reports

¨  Reconcile PAYG withholdings by comparing the total payments made to the ATO with the total PAYG figures appearing on the Payroll reports.

¨  Check that the superannuation amounts have been paid for the 3 quarters to date and reconciles for the year to date.

¨  Print or prepare Payment Summaries for your employees. Before you begin, make sure all of the employees you are preparing payment summaries for have an address (including town and postcode) and a tax file number recorded in their card. You will also need details of any fringe benefit amounts and reportable superannuation amounts for your employees.

¨  Backup

¨  Start new payroll year

¨  Load payroll tax tables before you enter pays in the new year

 

   3.    EOFY Checklist

¨  Record all transactions for the current financial year up to 30 June 2012 and clear the suspense account

¨  If you have inventory, you need to do a stocktake on 30 June 2012

¨  Reconcile all bank accounts, credit cards, bank loans, barter cards.

¨  Reconcile Accounts Receivable

¨  Reconcile Accounts Payable

¨  Reconcile Inventory – write off obsolete or damaged stock

¨  Reconcile Owner/Directors Loan Accounts & Inter Company Loans

¨  Reconcile GST Control Accounts

¨  Review Fixed Assets – new, sold, write offs

¨  Print Financial reports, review and compare to previous year

¨  Backup and send data file to your Accountant

¨  Enter adjusting journals provided by your Accountant and compare final P&L and Balance Sheet to the Accountant’s Financials

¨  Backup and store safely

¨  Start new financial year (keep prior year data).

 

by Antonette, ACK Bookkeeping Services.