As the end of the financial year approaches, it’s not just a period to close the books but a pivotal moment to reflect, plan, and thrive.
At Lift Accounting & Advisory, we see this time as a golden opportunity for business owners to review the past year’s achievements, make informed strategic decisions, and prepare for a flourishing future.
Closing off a financial year entails a thorough review and finalisation of your financial accounts, ensuring all financial statements accurately reflect your business’s current position.
But what does it take to close the books, and how can we best prepare for the new financial year ahead?
Let’s walk through the essential processes to ensure you navigate this critical time easily and set your business on a path to greater success.
1. Dive Deep into Your Financial Health
- Review Your Financial Statements:
Take a moment to examine your profit and loss, balance, and cash flow statements. These are numbers and a story of your business’s journey over the past year.
Understanding these can help you gauge your profitability, pinpoint opportunities for cost savings, and make decisions that fuel growth. Collaborate with a trusted advisor like Lift Accounting to polish and turn these insights into action.
2. Optimise Your Inventory
- Conduct a Thorough Inventory Review:
The EOFY is the perfect time to assess your stock levels, identify items that aren’t moving, and plan promotions to free up valuable resources. Managing your inventory smartly can boost your cash flow and reduce holding costs, giving you a clearer picture of your business’s current state.
3. Ensure Payroll Precision
- Update and Reconcile Employee Payroll:
Accuracy here is non-negotiable. Ensure that all employee details are up-to-date and that wages and superannuation contributions are correctly recorded. Timely addressing discrepancies is crucial to maintaining compliance and upholding your reputation as a reliable employer.
4. Maximise Tax Benefits
- List Applicable Tax Deductions and Depreciation:
Every dollar counts, so make sure you’re not missing out on any deductions. Each contributes to lowering your taxable income, from office essentials to professional fees and vehicle expenses. Don’t overlook the benefits of depreciation for your capital assets; these can also enhance your financial outcomes.
5. Commit to Your Future
- Stay on Top of Your Superannuation:
As a business owner, remember to fortify your financial future. Contributing to your super secures your retirement and offers immediate tax advantages. Understanding how much you can contribute and the best strategies can be complex, so consider seeking expert advice.
6. Refine Your Business Agreements
- Review Contracts and Agreements:
Take this time to scrutinise supplier contracts, service agreements, and leases. Are they still serving your business well? This review can uncover potential renewals, opportunities for renegotiation, and the need for updates that align with your evolving business goals.
7. Plan for Prosperity
- Set Goals and Budget for the New Year:
Now is the time to lay the groundwork for the upcoming financial year. Reflect on what’s worked, what hasn’t, and how you can adapt. A robust budget, aligned with your strategic objectives, will be your roadmap to navigating the upcoming year’s challenges and opportunities.
- Review and Update Business Strategies:
Ensure your business strategy aligns with evolving business goals and market opportunities.
Stepping into the New Financial Year
The EOFY isn’t just a compliance checkpoint; it’s a launchpad for future business success. By thoroughly engaging with these essential processes, you ensure compliance and gain valuable insights to drive your business forward.
Remember, you’re not alone—Lift Accounting & Advisory is here to guide you through this important time with expertise and ease. Let’s make this EOFY a stepping stone to your business’s best year. Contact us today.
