At the end of each month, you need to complete a month-end report to update your accounting statements. You must also issue a year-end report and mail IRS Form 1099s to vendors for their taxes.
Closing month-end reports keep your financial records updated.
Do you have complete control of your accounting system? Can you smoothly close your books month after month? These are just some questions to consider to help you control your finances.
Monthly and Yearly Closing Reports – What to do?
The following are just some of the many issues you have to address when considering monthly and yearly closing reports:
- Should you book changes in a current month or a subsequent month?
- Do you focus on analyses, including account reconciliations and periodic fluctuations?
- Is your closing process well-documented?
- Do you have a budget plan to compare your close to, looking at variances from various cost centers’ actual spending?
- Do you publish a closing calendar ahead of each month’s end?
- If you tie out accounts payable (A/P) receipts and invoicing daily, then at the end of the period, is your team balancing only a day’s worth of data instead of a month’s worth?
- Can you work toward a culture of continuous improvement and devise tools that measure your close?
- Have you considered doing income tax accrual asset–liability reclassifications at yearend?
- Do you constantly monitor state tax law changes and reflect their impact at least quarterly?
Good accounting records help you monthly and yearly as you prepare your taxes and present your company data to bankers, investors, and others.
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