Year End Accounting
Every business is required to prepare several different financial statements regularly, in order to be aware of the company's financial condition. Having these documents in good order provides management, creditors and investors with information about where the business earns its revenue, how it spends that revenue and the net worth of the company.
Documents needed for a business are:
End-of-year balance sheets
Profit & loss statements
Balance sheet review & reconciliation
Profit & loss analysis
End-of-year balance sheets
An end-of-year balance sheet is a financial statement that outlines the current assets and liabilities of a business. The balance sheets will summarise what assets the business owns and the liabilities that finance the assets at the end of the year. It’s a snapshot summary of the financial status of the business at a particular juncture and is sometimes referred to as the business's statement of financial position.
Profit & loss statements
The profit and loss statement reports a company's revenues, expenses, and most of the gains and losses that occurred during the period of time denoted. The period of time could be a year, a year-to-date period, such as nine months, a quarter of a year or one month. A profit and loss statement should be the revenues that were earned during the accounting period, and the expenses that match the revenues being reported or have expired during the accounting period.
Balance sheet review & reconciliation
A balance sheet review is a broad, tactical effort to improve the visibility into the balance sheet assets and liabilities. While the main goal of the balance sheet review is to free up cash, it can be used as a check to gain visibility into how the corporate strategy is being executed. Reconciliation is the process of comparing information that exists in two systems, analysing differences and making corrections so that the information is accurate, complete and consistent in both systems. Balance sheet accounts must be reconciled on a periodic and timely basis to verify that all items were correctly posted to the account.
Profit & loss analysis
The profit and loss analysis highlights the turnover accomplished over a given period, usually a 12-month period, from which it subtracts expenses supported by the business during the same period. The result of this subtraction shows the benefit or the loss made by the company at the end of the financial year. Understanding the balance sheet and the profit and loss account is important for analysis and for the key indicators. Key indicators help to determine if the company is profitable and signposts the main factors contributing to the net result.
At Oxford Professionals, our consultants help you with preparing the important documentation that keeps a tab on your business’s finance. Every client has a dedicated consultant that will advise them where to make changes to keep the business running with no problems.