The end of financial year (EOFY) is zooming up so fast, its hard to get your head around how time just disappears.
Now is the time to be thinking about the end of year requirements. Preparation and some thinking around this now will ensure a smooth process for you. Here are a few of the things you may need to consider:-
- Are you changing or implementing software come 31st March? Are you changing from desktop to cloud based software? Have you planned your time around this for set up and implementation prior to 31st March and finalising the process so you can manage the processes? Have you got the experts on board to assist you in this process? Don’t leave it until the last week in March.
- Have you got all of your bank feeds loaded in your software – think about loan accounts or credit cards here too.
- Have you processed a bank reconciliation for each bank account?
- Do you carry stock? You are required to do a stock take – luckily 31st March is a Friday so doing one over the weekend of 1st April would be best practice. List stock exclusive of GST and at cost. Advise of any stock to write off eg old or obsolete stock.
- Review debtors (those who owe you money) and write off any bad debts
- Review the asset register – are there any obsolete assets? Are any new assets missing?
- Review the repairs and maintenance code – any transactions over $500 should be investigated to ensure they shouldn’t be capitalised.
- Check your shareholders current account is not in overdrawn. There are options if this is advised of prior to year end (potential dividend declared or funds put back into the business to cover overdrawn current account). Talk to your advisor around this.
- Bonus’s for staff should be paid out prior to year end and tax paid to the IRD.
- Review your annual leave balances. Annual leave taken within 63 days of year end can be claimed in the prior year to assist with reducing your income.
- Do you keep a record of all money you owe? You will need a list of who you owe as at 31st March.
- Your bank will send you RWT (Resident Withholding Tax) certificates in April or May. This is a piece of paper your accountant will need regarding what tax you have paid to IRD on any interest you have earn’t with the bank over the year. Keep that safe – take a picture and file it in your computer or save it to your accounting software.
- When you receive your loan summaries, put them safely away as your accountant will also require these. If you bank doesn’t produce summaries, ensure your loan statements or a print out from your online banking are produced and ready just after year end.
- Did you drawdown and new loans during the year? Or hire purchases? Leases? Ensure all paperwork is available.
Your accountant or tax agent will send you a checklist for end of year. There are questions that we have to ask so ensure you answer every question. If a question is not relevant to you, put not applicable in your answer. If you don’t understand what is being asked of you, don’t be afraid to ask.
Of course, the Ontrack team are always on hand to assist and help you get your data prepared for your Accountant or Tax Agent. Clean data means an easier job for all those involved.