You don’t need to be an accountant to appreciate the effects of one financial year ending and another beginning. Similar to a new calendar year, a new financial year can be used as the perfect opportunity to carry out a couple of those tasks that we all too often place in the “too hard” or “later” piles.
Consider some of the following tips you can apply towards your business:
- Review your insurances. Basic but critical to review on an annual basis. This is not purely to check if your insurance is still valid and has rolled over in the following year but more importantly whether it covers the business changes or advancements you have added or changed over the last period of cover. You don’t want to be in a position of reliance on your insurances, only to find out that something you thought was a given, is actually an exclusion within your policy.
- Have you had any significant financial events throughout the year, such as investment into new assets or new loan agreements? Whilst these transactions are fresh in your mind, combine all relevant documents in respect of these transactions in one area with accompanying notes on their objectives as well as how you’re planning to maintain and/or finance these transactions.
- Have inventory/stock? Make sure you conduct a stocktake before the end of the year in order to review the profit made throughout the financial year.
- New idea you want to bring into the business but don’t know if it has any merit? Find someone relevant to brainstorm the idea with or book a consult with a professional adviser such as a lawyer or accountant.
- Business at a standstill and/or not reaching your set out objectives? Don’t delay and book a consultation with a professional adviser to offer a fresh outlook on your current situation.
- Time for new software or record keeping improvements? New financial year is often seen as the best time for such additions. Make sure you test the software before fully committing, to ensure it meets your expectations and has the relevant features you require.
- Reconcile all bank and credit card accounts at 30 June. This action saves time and money for you and your accountant when preparing your annual accounts.
- Finally take the time to organise hard copy documents into a systematic order, by financial year and type.
- Ask your accountant for a checklist of what they will need to prepare your annual accounts or format they would like your data to be presented in. Some accountants have given up on old school methods of hard copy documents and data on disks and cd’s and instead prefer to receive documents via email and other services such as Dropbox.
- Review your loans and credit card terms and offerings. Perhaps it may be time to roll over into a new account with lower interest charges and annual fees or perhaps consider increasing repayments to get rid of that loan once and for all.
You don’t have to wait till 30 June to get any of the above up and running, but it’s certainly a great time to take stock and finally take action on some tasks heavily overdue.
–Janna Fikh is a tax agent with a passion to make finance fun, bearable and more commercially efficient for all.