Year end accounting
Year end accounting
Every business is required to prepare several different financial statements regularly to be aware of the company's financial condition. Having these documents in order helps to provide management, creditors and investors with information about where the business earns revenue, how it spends that revenue and the net worth the company builds.
Documents needed for a business are:
- End-of-year balance sheets
- Profit & loss statements
- Balance sheet review & reconciliation
- Profit & loss analysis
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 which occurred during the period of time specified in its heading. 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, etc. 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 period given, 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. The most important is the understanding of the balance sheet and of the profit and loss account, and their analysis with key indicators. These indicators help to determine if the company is profitable and to understand what are the main factors contributing to the net result.
At Oxford Professionals, our consultants help you with preparing every important document to keep a tab of your business’s finance and where it’s at. Every client has their consultant who will advise them where to make changes to keep the business running with no problems.