It is hard to believe, but half the year is already gone! Now is the time to review and prepare your small
business’s books. Here’s a quick look at what to zero in on during your review to properly prepare your
books prior to year-end.

Reconcile A/R and A/P

Seize the opportunity to closely analyze your accounts receivable and accounts payable. If your business
is owed money, reach out to those who haven’t paid to fulfill payment obligations from unpaid invoices.
Keep in mind, the accounts receivable balances at the end of the year are an accurate look at what is to
be collected. Requested payments that are designated as “uncollectible” must be written off.
If your business still has accounts payable, tie up those loose ends as soon as possible. Year-end bills
that have not been paid are to be addressed before the final quarter comes to a close. Finally, double-
check that payments to vendors align with bills, guaranteeing expense transactions contain vendor
names, ensuring full 1099 accuracy.

Reconcile Balance Sheet

This is also the optimal time to guarantee balance sheet items are properly reconciled. Record and
amortize all new capital purchases as well as loans. The logic in reconciliation is to juxtapose the
balances of general ledgers with the appropriate documentation such as loan statements, ensuring the
ledger balance reflects reality.
There is a chance the general ledger will not properly align with the documentation used for support.
Make the necessary entries, reconcile and your books will be ready to go as you shift your sights toward
the fresh start that is the new year.

Reconcile Payroll

Reconciling payroll guarantees the tax forms used for the year’s end are 100% accurate. Everything
must be properly recorded, so the reconciliation serves as an accurate reflection of the company’s
financial standing.
Books transactions are to equate to the figures on tax forms, including myriad state tax forms along with
payroll information. When in doubt, lean on our team for reconciliation assistance for invaluable peace
of mind.

Check Inventory

The final quarter of the year is the best time to guarantee the inventory count is accurate. Inventory
impacts the profit and loss statement as well as the balance sheet. Take inventory prior to
beginning of the new year, and you’ll have the information required to plan for the year ahead.
Tabulating inventory is also helpful in identifying items that are coveted. Take the opportunity to
whittle down inventory, discounting or eliminating items that failed to sell as expected.

If you are still on the fence whether inventory counting is prudent, consider the fact that such
counts are integral to tax returns at the year’s end. Counting inventory provides a closer look at the
business’s actual income and loss across the year that is coming to an end.
Mind the Profit and Loss Statement
Now is the time to scrub the profit and loss statement, pinpointing items to be recorded to the wrong
accounts, then remedying those errors prior to the point at which taxes are filed.

Our experienced small business accountants and bookkeepers are here to ameliorate your end-of-year
challenges. Lean on our team to clean up your books and prepare your organization for a smooth
transition into year-end.

Contact us today for assistance. You can reach us by phone at (720) 608-6240 or by email at