Preparation for the End of Financial Year

The end of the 2016-17 financial year is fast approaching. For business owner’s this is a busy and important time of the year. Keeping on top of the tasks you need to do to prepare for tax returns, bookkeeping and putting things in place for the next financial year can sometimes be difficult, stressful and time consuming. Here are some ideas to make the process easier for you:

Preparation of your Xero File ready for your Accountant

Each Xero Organisation has its own unique email address where you can send important information for your Account enabling them to conduct your tax return in a proficient and timely manner.  Here’s a link to tell you a little more about Files feature in Xero: https://help.xero.com/au/FilesEmail

The documents you should send to Files using your unique email address are:

Create 16–17 Folder and email the documents the accountant needs like:

  • Tax Invoices of capital items purchased, fixed assets or hire purchases.
  • All bank statements showing a closing bank balance for 30 June
  • Fixed Assets
  • Workcover annual reconciliation
  • Payroll reconciliation
  • Financial Reports – Profit & Loss and Balance Sheet
  • GST Reconciliation Report

Perfect Handover Tips

Accountants love to have questions from your bookkeeper to service you, the client working together in the client’s best interest.  So, if your Accountant and Bookkeeper aren’t already connected, (which they should be) please introduce them so they can work together better for you as an efficient result perhaps saving your time and money.

  • Bank Statement should be all reconciled in Xero and matching your internet/or physical paper statements, including; credit cards, and loan accounts.
  • Creditors brought to account up to date, ensure everything displayed in Aged Payables is in fact true and remaining to be paid by the business to the supplier.
  • Debtors, apply any aged Receivables to Bad Debts if you have been unable to recovery the income, so you can claim back the GST.  June is a great month to chase, chase, chase your Debtors encouraging them to pay before 30th June.  It’s ideal to only have Aged Receivables owing in a 30 days’ period, anything older than this, get on the phone, or ask your bookkeeper to follow these up. Workcover reconciliation and Payroll reconciliation
  • Clear out your suspense account and ensure that there are no pending queries throughout the year that you’ve posted here.
  • Make sure all super guarantee contributions are paid and cleared by 30th June for the current year or they will not be included as a deductable business expense under the new SuperStream legislation.
  • Review items coded to Repairs & Maintenance, General Expenses and Legal Fees, Accountants audit these general ledger codes as many items are coded here on an assumption if you are doing your own bookkeeping for your business and can sometimes be questionable.   
  • Any donations you’ve made throughout the year ensure these have been made to registered charities.  
  • Anything coded to Entertainment, determine what tax codes to use, GST on Expenses tax code or GST Free on Expenses and ensure to add as much detail as possible. Entertainment if recorded incorrectly can be exposed to further tax calculations

Summary

A checklist of tasks you can use to accomplish your end of year business bookkeeping will help to make a difficult and complicated process, simpler, less stressful and you’ll be more organised and prepared you to tackle a new financial year.

Making an appointment with your Accountant or Bookkeeper in May/June is a vital time to review the current year and have discussions on how to improve working together for the future.

Please download Xero’s Year End Checklist here to help you get on track and prepared as best you can.