Here we discuss the most important step of the Year End Checklist

Year End Transactional Entries

■      Enter Final A/P

  • Have you recorded all expense items as of the end of the year?

■      Issue Final A/R Invoices

  • Have you issued all invoices and applied cut off procedures?

■      Process Final Payroll

  • Are all payroll year end items recorded? Fringe Benefits?

 

BALANCE SHEET ACCOUNT ANALYSIS

■      Reconcile Bank Statements

■      Prepare A/R Aging

  • Are you going to collect all A/R? Write off amounts not collectible as bad debt.

■      Inventory

  • Verify both physical count and valuation.

■      Prepaid Expenses

  • Do you have expensive items that should be spread out over the year? Annual memberships etc.

■      Fixed Assets

  • Confirm gain/loss on fixed asset sales
  • Calculate and record year-end depreciation

■      Accounts Payable

  • Do you have vendors with credit balances, if so request refunds?

 

FINANCIAL REPORTS

■      Profit & Loss Statement

  • Compare current year Profit and Loss Statement, compare:
    • Significant variances to budget
    • Compare large variances year over year

■      Balance Sheet

  • Print Balance Sheet and confirm all account reconciliations

■      Cash Flow

  • Print Cash Flow report and compare to forecast/budget

 

YEAR END PAYROLL TASKS

  • Confirm with the payroll service provider what forms are required and order as necessary
  • Prepare or verify Quarterly 941 and Annual 940
  • Verify State Quarterly and Annual forms
  • Prepare or verify W-2’s and W-3

 

1099 FORMS

■      Preparation

  • Verify you have current W-9 on file for all required payees

■      Execution

  • Review Vendor List for 1099-eligibility. Identify all G/L accounts for 1099 eligible services
  • Determine reportable amounts for 1099’s. Exclude payments made through third parties (on credit cards or through PayPal-type services). Ensure the threshold is met in each category of payment.
  • Prepare and review Annual 1096 and attach Copy A of all 1099’s
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