Getting ready for year-end: a checklist for your financial statements

Annual financial statements summarise a year of business activity. They are used by SARS, banks and investors, and increasingly by your own team to make decisions. The quality of the statements depends almost entirely on the quality of the records behind them.

A little preparation before year-end means fewer queries, fewer delays and a lower professional fee.

The checklist

• Bank reconciliations completed for every account, up to the last day of the year.
• Debtors list: who owes you money at year-end, with any amounts you do not expect to recover marked.
• Creditors list: who you owe at year-end, including invoices received after year-end that relate to the year.
• Stock count on the last day of the year, if you hold stock, with quantities and costs.
• Fixed assets: purchases and disposals during the year, with invoices.
• Loans: statements for business loans, vehicle finance and any loans to or from shareholders or directors.
• Payroll: a summary of salaries for the year that agrees to your PAYE submissions.
• VAT returns for the year, if you are registered.
• New contracts or major changes, such as new premises, new shareholders or significant new customers.

Common causes of delay

• Personal expenses paid from the business account, or the other way round.
• Missing supplier invoices for large payments.
• Unexplained transfers between accounts.
• Shareholder or director loan balances that have not been recorded.

Year-end should confirm what you already know about your business, not reveal surprises.

Keeping records up to date monthly turns year-end from a scramble into a review. If this year is a scramble, it is a good moment to set up a better routine for next year.