June 30 can be a very scary time of the year, particularly for business owners, as it marks the end of the financial year. There are countless tasks that must be completed before wrapping up the financial year. We know it can sometimes be a struggle to keep track of it all, so we’re giving you some basics steps to follow to ensure you’re prepared!
- Step 1
Follow up with any outstanding payments from customers to maximise your cash position. Any unrecoverable debts are able to be written off as bad debts for which you will be able to claim a tax deduction.
- Step 2
Review your balance sheet and ensure all amounts have been reconciled and are correct.
- Step 3
Review your capital expenditure. If you are considering purchasing fixed assets for the business, these costs can sometimes be brought into the current financial year thereby lowering net income rather than taking the cost in the new financial year.
- Step 4
Ensure you are on top of all your superannuation obligations. You will receive a deduction for all employee superannuation obligations which you pay prior to the end of the financial year.
- Step 5
Plan for the future. Develop realistic profit and loss forecasts for the next 12 months, and set business goals for the next couple of years.
- Step 6
Review your insurance cover so you are protected against all the risks facing your business. Also review your home warranty limits and ensure they are suitable for the coming financial year based on your pipeline.
- Step 7
Consider developing a business succession plan. You can start succession planning years ahead of time; having a plan can be useful if there is an unexpected event, such as illness or death. Without a plan the future of your business can be at stake. Early planning also helps you to maximise the value of your business.
Remember, your accountant or financial advisor is always there to help. They’re professionals with years of experience, an extremely valuable asset when it comes to something as serious as your business and its accounts.
*These steps were developed by a professional accountant; however you should always seek advice from your personal accountant or financial advisor when managing your accounts.