Is your small business ready for end of financial year?
Using it as an opportunity to spring-clean your affairs means you can get your business organised and ready for a successful year ahead.
|Lodge annual returns for PAYG withholding, fringe benefits tax (FBT), and goods and services tax (GST).|
|Complete summary of income and expenses in your profit and loss (P&L) statement.|
|Meet all superannuation payment requirements.|
|Find out what tax deductions you can claim, including:
● Website costs.
● Motor vehicle expenses.
● Home office costs.
● Travel expenses.
● Machinery, tools, equipment and computers.
|Make explanatory notes of substantial differences with prior operating years.|
|Itemise and apportion personal and business expenses.|
|Record all asset purchases or expenditure on improvements so you can calculate depreciation expense claims and for capital gains tax purposes, including the $20,000 instant asset write-off.|
|Review the GST codes assigned to balance-sheet items to ensure your BAS is correct.|
|Get across any tax changes starting next financial year.|
|Reconcile bank accounts and loans.|
|Ensure all subsidiary ledgers reconcile with your general ledger.|
|Review your banking and finance arrangements for savings and better deals.|
|Review your cash flow forecast to manage any potential shortfalls and ensure you’re in a position to pay staff and suppliers.|
|Review your debt collection, including:
● Early contact of slow payers.
● Invoicing as soon as good or service is delivered.
● Establish procedure for dealing with bad debts.
● Review credit-checking procedure for new debtors.
● Renegotiate trading terms with bad payers.
● Ensure reconciliation system is working to pick up on discrepancies and non-payment.
Business best practice
|Check that your business has the right insurances in place, and update your information to ensure you’re properly covered.|
|Back up customer, business and financial data in a secure system, and a secure off-site location if necessary. Consider whether you need a natural-disaster plan.|
|Audit suppliers – like insurers, telcos and software providers – to see if you can make savings or get a better deal.|
|Review marketing plan to maximise bang for your buck.|
|Conduct staff performance reviews and reset KPIs for the coming financial year.|
|Check state and federal business hubs for any grants or programs you may be eligible for in the new financial year.|
|Revisit your business plans, including:
● Check strategy is still current.
● Update goals, objectives and KPIs.
● Take stock of your competitors.
● Look at your SWOTs for the new year.
|Dispose of old and slow-moving stock.|
|Write off excess stock.|
|Calculate spoilage level and review procedures for preventable losses.|
|Consider implementing a tracking and storage program for any high-value stock.|
|Review purchasing policies and procedures to avoid over-purchasing stock.|
EOFY is a great time to review your financial needs and arrangements. Talk to an expert at Prospa on 1300 882 867 or apply online for a small business loan today.
We spoke to accountant Peter Knight and small business owner Louise Lashlie about how to prepare now for the end of JobKeeper on 28 March 2021.View more
New year, new you! Now is the time to wipe the slate clean and get on top of your business finances so you can charge into 2021 full steam ahead.View more
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