Year-End Checklist for Your Small Business

When the end of the year draws near, it’s time to wrap up essential year-end tasks and prepare your financial records for tax season. Doing so also provides a critical view into profitability and future planning. Whether you have an accountant to manage your financial books—or you take on this task yourself—the following checklist can help you wrap up the year with confidence.

• Organize business expense records. Do you dread sorting through a pileup of receipts and statements at year-end? Save time by implementing a filing system and/or accounting software for tracking business expenses.
• Evaluate financial performance. Analyze your company’s profitability by looking at profit and loss statements—this is your business income (revenue or sales) minus expenses over a specific period of time. Revisit your goals for the current year and consider any last-minute changes that could boost performance.
• Take inventory. If you sell products, conduct an inventory assessment so you know how much of your business capital is wrapped up in inventory. You may also want to take an inventory of office equipment and supplies so you can budget accordingly for the coming year.
• Look at liabilities. Review current and long-term liabilities, including accounts payable (money your business owes to vendors, contractors and suppliers), credit card balances, and loans from financial institutions. Look for ways to efficiently manage debt to keep your business in a strong financial position. You may discover that you need to take on additional debt—such as a line of credit—in order to grow your business.
• Review your tax strategy. It’s never to early to review the rules and consider ways to save on your 2022 tax bill. For example, you might decide to buy equipment, make charitable donations, or defer revenue into the next year to increase deductions or reduce revenue. Be sure to discuss with your tax advisor before taking any action that will affect your tax situation. Get ready for tax season now by organizing receipts and other documents you’ll need for tax preparation.
• Update your business plan. When you’re crunching the numbers and reviewing your financial reports for 2022, you might identify sales cycles or other trends you’d like to replicate in 2023. You might also notice gaps in the revenue stream or challenges you’d like to work on in the following year. Use the data available to you to help set specific goals and map out your business plan for the next year and beyond.

Wrap Up the Fiscal Year With Confidence

At Navy Federal Credit Union, we’re here to connect you with the resources you need to finish the year strong. Learn about our Business Solutions designed to support your small business and stay in-the-know with our Small Business Resources.