Only 1 month out from End of Financial Year! Are you ready?

End of financial year

It’s only a month out from the end of financial year, so time to knuckle down for a lot of us working in startups. Most small businesses across Australia are racing towards the EOFY deadline, making the most of the $20k asset write-off, covering BAS, ATO, employee or super payments, or just stocking up on resources before the new year starts. It’s a busy time for all businesses, and it helps to be on top of what’s going on.

 

Last month’s housekeeping

 

From the last blog post, ideally by now you would have organised a few things, including:

  1. Systems management – By now, you should have your financials in some sort of online application that will help you collate accounting information. This is quite important as it lays a foundation for you to refer to important pieces of information and to quickly and securely recall that information when you need it.
  2. Expenses reconciled – by now you should have written off (or started to write off) any bad debts. You should have an ongoing plant to get rid of them as soon as financially viable, as they can easily create issues for your business and cash flow in the future.   
  3. Prepare your financials –  This step becomes increasingly important as your business grows. Financials such as a balance sheet, a profit and loss statement, and breakeven analysis are documents you should have updated.  
  4. Goals and visions – Last time, we asked you to reflect on the year’s goals and visions for the business. You should have an idea by now of what you want to achieve for growth and future success.

These steps will help you to smoothly make your transition into a decluttered and clear new financial year. It is important that your business sorts out these first steps to be ahead of the curve in EOFY preparations.  

 

What else do you need for the coming month?

 

So, you’re now one month out. What do you need to do?

  1.     Revisit staff salaries – EOFY is a good time to review staff salaries and ensure they are in line with awards and statutory requirements, at minimum. This is important because it means that you are operating in your employees and businesses best interest, and fully compliant with the relevant legal requirements.  
  2.     Reconcile your receivables – Chase down any outstanding payments on from customers and clients. To remain on top of the cash flow crisis {hyperlink}, it is crucial to reconcile your receivables. Doing this allows for a buffer for SMEs in case problems with cash flow arise.
  3.     Superannuation payments – this should be taken care of monthly, however a yearly audit of your super payments allows you to keep on top your payment requirements, ensuring that employees are being paid correctly into their nominated super fund.   

 

A strategy that may help…

 

What some SMEs will do to ensure that they make the most of the EOFY, is bring forward tax-deductible expenses and defer income to work in your favour, by reducing their taxable income for the financial year.   

 

Get ready!

 

The above points should make for an easier wrapping-up of another financial year. Being on top of things at such a busy time can lead to a less stressful future, especially when trying to meet deadlines, gather quotes and manage cash flow whilst continuing to make growth plans for your business.

 

Stay tuned for the final part of our EOFY guide in a few weeks’ time.

Good luck!

 

The Spotcap team.