Year-End Accounting Checklist: 10 Things to Cross off Your List

As 2024 winds down, you should square away several accounting tasks. Your accounting books should be organized, up-to-date, and ready to transition into a new year. To prepare for 2025, follow our year-end checklist and check these ten procedures off your list. Remember that your year-end checklist might differ from another business’s, depending on your size and processes.

1. Run Financial Reports

At a minimum, develop a profit and loss statement, a balance sheet, and a cash flow statement. Analyze how you spent your money last year and determine whether you’re on track to meet your profit goals and cash flow needs. If you’re a business owner not actively involved in management, consider having a year-end audit or review of your financial statements prepared by a CPA firm to ensure their accuracy.

2. Review and Update Your Vendor Contacts

Update addresses, phone numbers, and the names of your key contacts. Delete or archive vendors you don’t use anymore. This yearly housekeeping will help keep your lists organized and ready for orders and payments in the coming year.

3. Critically Review Your Policies and Procedures and Make Changes

During the year, you may need more time to review policies, such as billing, practice management, accounting, personnel, operations, and consultations. At year-end, it is a good idea to look at your policies and procedures and ask yourself where you can implement improvements. .

4. Account for Inventory

If your business has physical inventory, complete an inventory check before year-end. You must get an accurate count of the materials and supplies you have on hand if your business stores inventory. Match your inventory totals to your balance sheet. If you find discrepancies between your count and balance sheet, adjust. Accounting for inventory at year-end can help you know how much you spent on inventory during the year and its value.

5. Start or Contribute to a Retirement Plan

Make payments to your retirement plan or set one up before December 31 to reduce your income for this year. Now is the time to max out your contributions. If you still need to set up a retirement account, talk to a financial advisor to determine which plan is best for your business. BGM recommends Cornerstone Private Asset Trust Company, a BGM Group Company, for Retirement and 401K Services.

6. Make a List of Your Business Accomplishments from the Past Year

It’s easy to forget about the milestones you’ve achieved and the obstacles you’ve overcome. Listing them is an excellent feel-good task. Once you’ve made your list, share it with your employees and recognize them for their contributions.

7. Meet with Your Accountant

Have your accountant prepare a tax projection, so you understand your tax liability come April. If the projection is ready before December 31, you can still do things to reduce your tax liability for 2024. Now is also the time to discuss tax planning for 2025. Reach out to your BGM tax professional or  contact us to discuss your specific situation.

8. Talk to an Attorney

Making the time for an annual legal consultation can show you what you need to do to keep up with regulations, contracts, and employment laws that affect your small business. An attorney also can help you evaluate and minimize the legal risks you or your business may face.

9. Identify Your Needs for Staff, Hiring, and Outsourcing in 2025

The end of the year is a great time to think about the tasks you don’t like or don’t have the time or expertise to do well. Make plans to hire staff or outsource to consultants to take some things off your plate. Decide whether you’ll need a larger workforce in the coming year and, if so, budget the money to pay for it. Outsourcing some of your accounting needs could allow you to cut costs without impacting your accounting accuracy.

10. Set Goals for the Coming Year

The end of the year is a natural time to reflect on and analyze your business. Assess whether the company is where you want it to be, what your prospects are for the future, and whether your current business practices are adequate. As you reflect, set goals for the year to come.

Start the New Year with Confidence

Utilize this year-end accounting checklist for your business and contact us for a consultation. We offer a complimentary initial consultation to discuss your needs. Reach out to learn more or schedule a meeting to get started.