End of financial year is an important time for small businesses. 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.