I’m Bobbie Witt with Bookkeeping Confidential, here with you today. We are a virtual bookkeeping firm specializing in small and startup companies. Today, we’re going to talk about year-end planning. There are several things that you’re going to want to do. I have on the website a (FREE) year-end planning checklist (get it now). So, these things that we’re talking about you can go actually pull off and just print it and go from there.

Year-End Planning with QuickBooks: Step-By-Step

Step 1.

The first thing you want to do is plan your receipts. How are you taking care of your receipts? Are they in a box? Are they in a receipt management software? Do you already have them posted and logged in and you’re ready to go? Some people struggle with this throughout the year and some don’t. But, we have a plan that can help everybody.

The first three reports that you’re going to want to pull is your profit and loss or your income statement. I’m using QuickBooks online but there are many other softwares out there that you can use. Select this year, I’m going to use to last month – 10/31, cash basis, then run report. This profit and loss gives you all of your income all through here. Then you’re going to have your total income down here and cost of goods for your gross profits. And you’re going to have your expenses classified based on your activity and you’re going to have a net income.

Follow along with video below

Step 2.

The next report you’re going to want to pull is your balance sheet. Select the same time period, this year to last month, cash basis, run report. The balance sheet is a snapshot of your business. You’ve got your cash, your assets, your liabilities and your equity. This report is ongoing. The income statement zeroes out at the end of the year, but this one is always ongoing. It keeps your information from year to year and puts it over here into your equity.

Step 3.

The net report that you’re going to want to look at is your statement of cash flow. Again, select this year to last month and run report. It takes the net income from the report we just talked about and your items from your balance sheet. There’s your equity. Cash at end of period, this is your actual cash. So, you’re going to take these reports and you’re going to evaluate them further.

Step 4.

I’m going to go back to the profit and loss. Let’s start with your income. Let’s do plants and soul. And you just want to review each and everything to make sure that’s really what happened. If you’ve been reconciling every month then this should be a very simple process. If you haven’t been reconciling every month, this is going to be very tedious.

Go in here and make sure all those decks and patios, everything, is classified how you want them. Just go in and do a thorough review. Then, you’re going to want to do your goals. You established goals last year going into 2019, is this where you want it to be? Is your business plan standing up as it should have or that you wanted it to? Are you maximizing your profits? Do you have so much income that you need to be investing more expenses and stuff into your business to reduce your gross income? It’s also time to meet with your CPA. I’m currently getting a lot of emails from CPAs requesting these exact same reports so that they can meet with the client on a tax level basis and get them ready for the new year.

Step 5.

Now that you have this, it’s time to plan for next year. How you’re going to take these numbers and how you’re going to grow them? How much do you want to grow them? What can you do in your business today to grow your business for next year? What can you outsource so that you have more time to spend on your business? This is also a very good time to start your 1099s and your W2 reviews.

Final Thoughts

Let’s go back to reports. Here, 1099 transaction detail report. All the software should have the same type of report. You need to be collecting your W9s so that you have the social security number then you’ll be able to send your 1099 out to your vendors. Same with your payroll. If you’re doing W2s, do you have all the information on your dismissed employees and your current employees? These are things just to make sure that you’re looking at: what about your benefits? Are those being properly recorded?

So, now that you’re all organized – you have everything in front of you – it’s time to just set some time for yourself and look over your business as a whole.