Preparing for a New Year

The holiday season has officially begun, but while you’re buying presents and food, it’s important to remember New Year’s Eve doesn’t just mean champagne and a kiss, it means the end of the fiscal year, which your business should be prepared for! Make sure that you have a talk with your tax accountant, to see what position you should be in by the end of the year. How is your income? How are your expenses?

There are a number of strategies that can help you get where you need to be for the end of 2023. Do you need more income? Your business can bring in more income from your outstanding invoices to your customers (your open receivables). As long as you have received the money by December 31st, it counts as 2023 income. If you don’t want more income, don’t collect your receivables until January.

Does your business need more expenses for 2023? Then you can pay cash now for 2024 expenses. If you have media or advertising, you can pay ahead of time instead of in January. You can also take this opportunity to furnish your office, buying new furniture or even a new computer or equipment that you’ve been waiting for. Black Friday sales are a great opportunity to get some good deals! Just make sure that if you want that expense listed in 2023, then any checks written should have a 2023 date written on them. Also, if you are granting holiday bonuses, make sure to include them in the last payroll of the year so that the correct taxes are deducted.

Even if you don’t need to adjust your income or expenses, there are some general housekeeping tasks that you should make sure to do before the year’s end. Now is the perfect time to reconcile any payroll liabilities that you have. You should also do some bank reconciliation - make sure that everything in your accounts has been cleared and outstanding checks have been cashed. If checks have not been cashed, then call the vendors, make sure that they have received their checks, and ask them to cash them. It’s wonderful to start a new year on a clean, balanced slate.

While you’re doing all of this financial management in the holiday season, it’s important to take some time to be thankful, especially with Thanksgiving just around the corner. Be thankful for your family, your friends, your health, but also your business. You have worked so hard on your business, so make sure to appreciate and be grateful for what your own hard work and dedication have built! May your business only grow stronger in 2024.