When you are a business owner, you know that as the end of the year approaches, life will get hectic in a hurry. Whether you are focusing on trying to pay taxes or making sure various agreements you have with suppliers and vendors will continue to benefit your business, you’ll have plenty on your plate while trying to get your finances organized before the start of a new year. To help you do this successfully, here are five tips to keep in mind.
1- Analyze Your Company’s Financial Reports
Once you print out your company’s profit and loss statements, balance sheets, and cash flow statements, don’t just let them sit on your desk and collect dust. Instead, take some time to analyze the financial reports to see if there are expenses that can be cut if your company is as profitable as you anticipated, and if you have adequate cash flow to give you financial flexibility in the coming year.
2- Discuss Matters with Your Accountant
While things may have been one way at the start of the business year, chances are certain things have changed along the way. Because of this, always schedule a meeting with your accountant to talk over such things as changes to tax laws, how you may be able to improve your company’s cash flow, and whether or not you should move forward with any plans you may have for expansion, new equipment purchases, or additional hiring.
3- Reexamine Vendor and Supplier Contracts
Before the new year begins, take some time to reexamine any and all contracts you have with your company’s suppliers and vendors. In doing so, you may find there will be ways to renegotiate key deals and cut expenses. Should you be expanding into new markets or planning to introduce new products, you can also use this time to reach out to new vendors and suppliers who may be able to help with your company’s growth.
4- Prepare to Pay Your Taxes
The end of your business year means it’s time to make preparations for paying your taxes. If you’ve already met with your CPA, you should have a good idea about your estimated tax payments and how owning a franchise will impact you in regards to keeping your tax payments as low as possible. Since most businesses make estimated tax payments, this is where knowing your cash flow will come in handy, since you don’t want to experience a cash shortage at year’s end when taxes come due.
5- Evaluate Your Financial Software
Last but not least, evaluate the financial software your company is using to see if changes need to be made. For example, is there a newer version of the software that would allow more tasks to be completed automatically? If so, this could free up workers to do more important tasks, or even let you reduce your workforce to save money.
By following these tips and paying close attention to the smallest of details, you can have your finances in great shape by year’s end.