YEAR-END CHECKLIST for Mr.Appliance ® Franchisees
toolbox ® |4th Edition Here’s a checklist (Source: Business Resource Services): 1. Call your bookkeeper, accountant, and/or CPA today and schedule a meeting by January 31. 2. Set a date that you expect your year-end numbers to be finalized. Communicate this date with them and get their commitment to achieve it. Suggestion: Valentine’s Day is February 14. What better gift to give yourself? 3. Review with your investment advisor and/or retirement plan administrator and plan funding for the current year retirement contribution. 4. Ask your CPA what issues need to be resolved to make this deadline. Most likely they will include: • Depreciation schedules (start getting capital purchases and sales to your CPA now so he/she can start updating your depreciation schedule). • Payroll reconciliation. • Compare current year-to-date expenses to prior year for any unusual/unexpected variations and investigate. • Have your CPA come up with an initial tax liability estimate for the year by forecasting remaining revenues and profits. • Work with your CPA to come up with a strategy to minimize your tax liability for the coming year. • Review needs for working capital for the coming year, including anticipated capital expenditures. • Review current financing and bank relationships, including line of credit and term loan balances and potential financing needs. • Is the existing accounting system adequate to meet management’s information needs? If not, what’s the plan to upgrade? Assign a date and a person(s) responsible for resolving each of these issues. Put these dates into your scheduler and have weekly progress meetings. Establishing a written year-end closing procedures checklist for accounting staff and management personnel will help you to achieve your goals of a timely, accurate and cost efficient financial close for 2016 and all future years.
BY: MICHAEL GREEN, VICE PRESIDENT OPERATIONS
W hile helping Mr. Appliance franchisees gain an improved understanding of their financials (P&Ls, Cash Flow and Balance Sheets), I oftentimes refer to this process as one of the “Un-Fun” aspects of effectively operating a profitable and cash flowing business. Believe it or not, financial statements can actually be FUN. Understanding and learning how to read, analyze and interpret the financial performance of your business can be financially rewarding (equals FUN). Plus, by better understanding how to read your financial statements, you are now in a much better position to make more informed business decisions and to, hopefully, avoid making costly and “not-so-good” business decisions. In many ways, financial statements are a lot like report cards (remember high school?). A financial statement can tell you “how well” or “how not-so-well” your business performed over a period of time (week, month, quarter or year) in most cases. That’s the reason I encourage and work with Mr. Appliance franchise owners/business managers to take the time to learn how to read their financial statements. With this year’s economic challenges and political environment, having timely and accurate financial data becomes even more critical to help you make sound decisions for your company and to reach your financial goals and objectives. So, by setting a schedule in place to finalize your financial statements for the year, you can get a head start on tax planning so you can take proactive steps before the end of this year. This will help you identify any possible money saving options.
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