Accounting services and requirements are some of the inevitable business demands. This is why accounts professionals are on high demand in business places. When it comes to balancing business books and financial statements, there is never a more dreadful time than end of the year.
During this period, payroll professionals are required to perform more than the usual fortnight, weekly and monthly tasks. On one side, all books and records should be reconciled to finalize the end of year. On the other, preparations for the next year should be in place already.
However, there are various techniques that seasoned payroll professionals use to lessen the effort and time consumed in finalizing a business’ account.Here are few insights to help you achieve ease during the process.
1.Don’t wait for the final payroll to reconcile payment salaries
Reconciling employee earning before the end of year is often the best path to take. It simply gives you enough room to counter check records and make necessary amendments to employee earning.
The advantage is that you can make these adjustments after the original summary is out thus saving you the hurry when it is time to produce the final reports.
2.Find out exactly what is to be included in end of year
Many small business owners get stressed simply because they never have the right clues on what to include. It is important to remember that you do not necessarily need to include everything as it is.
For instance, dropping cents and reporting whole dollar values will give you ease when balancing the books. Include salary sacrifice made towards reportable employer super contribution (RESC) and those paid towards employee termination payments.
3.Find out what not to include
Since you now know what to include, it is still important to know what is irrelevant in final summaries. Ensure you make adjustments to employee earning and remove all the negative amounts before producing payment summaries.
You should not include superannuation contribution guarantee (SCG) amounts in your final summaries.
4.Review your final payroll processing and pay dates
Payrolls processed and paid on or after 1st July will usually appear on the next end of year summaries. If you intend to reconcile all records before opening new books, make sure they are processed and paid by 30th June.
If you use electronic payments, the dates should be those specified on the transaction.
5.Issue payment summaries by 14th July
It is always recommendable to issue payments to payees, workers and employees before 14th July. More importantly, you should consider how your business will distribute these summaries.
If you are using manual prints posted to your employees, give time for delivery. If you use electronic means,ensure they know the steps to access those details online.
6. Consider paying superannuation guarantee contributions early enough
Once the super funds receive payments, they proceed to count SCG contributions and this order of events cannot be changed since receiving payments triggers counting the contributions.
For instance, businesses were required to pay contributions for the 4th quarter (April – June 2015) by 28th July. However, employees may want to make payments as early as 30th June for various reasons.
7.Speak to your employees and find out their arrangements
Following on early SCG contributions, it is upon the payroll account professionals to find out how many employees want to make SCG contributions by given dates.
They may want to take advantage of voluntary after-tax contributions as provided for in government schemes. Just make sure you schedule everything giving sufficient time for the employees to receive their payments.
8.Reap from deductions, rebates and , write-offs by 31st March
It is a wise decision to contact your account manager and discuss all your business deductions, rebates and write-offs before 31st March.
Ponder action plans for scrapping worthless stock and equipment and review asset registers to track your company’s equipment utilization (purchased, sold, disposed…). This will help you refine the records and reconcile all data accurately.
9.Have a keen eye for changes in compliance
Each year comes with various compliance changes which are very important to keep up to date with. Failing to follow compliance can result in penalties. Although years con go by without major changes, tracking emerging policies should never be oversight.
Changes may also be implemented in stages, which is why you need keen watch.
10.Create and backup a separate copy of the account
Regardless of the effectiveness and security your accounting services and systems depict, it is still very crucial to take time and create a backup. This is important whether you work on your desktop or rely on cloud storage.
Create an accounting system that stores files on the 2019/2020 year only then save it somewhere else even offline if you wish to. Ensure the backup is safely stored and protected from competition or other people who may use the data to affect your company.
11.Make preparations for the new financial year
As the end of year closes and summaries are reported, it is also the time for reassessing your business plans to determine if you are in the projected paths as you prepare for the coming financial year.
Review your accounting services and software considering cloud accounting solutions and emerging technologies that can be of benefit to your business.
Meet with your trusted advisors and discuss your business’ progress focusing on topics such as benchmarks and KPI performance as well as budget.
There are various other tips on finalizing year financial statements and preparing for the new financial year. Small insights like paying superannuation on employee holding account, reviewing variations of PAYG, claiming expenses, staying on top in record keeping and planning your expenditure are all important.
The ultimate goal is to ensure everything is reported correctly. Sufficient preparation for the coming year is in place and the effort/time spent in the processes involved is reduced. You can always hire third party outsourced professionals to help you finalize the summaries.
For More details contact us .