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End of year closing - 5 things to remember

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end of year closingAs 2010 draws to a close and we look toward 2011, it's time to start preparing for the accounting year end closing process. Whether you prepare your own information or outsource the project to an accountant, as you close out your books for 2010, there are some simple steps you should take to help make the process easier.

The year-end financial statement is the most important reports in the year-end process, it’s used for tax preparation, future reference, and weighs more heavily in decision making than monthly reports. Because it such an important report, accuracy is key.

Here is a list of 5 things to remember when preparing for the year-end:

  1. Bank Rec – Does your general ledger match the bank statements? Make sure your checkbook is balanced and all of your records agree.
  2. Balance sheet – Don’t forget to review your balance sheets for loans to verify payments and account balances with your lending institutions.
  3. Account Payables – Have you recorded and balanced all of you account payables to detail? Make sure that your invoices match up with your records.  
  4. Account Receivables –Have all of your receivables been accurately records in the right fiscal year? Be sure to balance your receivables to detail.
  5.  Payroll – Is your last payroll of the year completed and balanced with your records.

Each accounting software package has its own procedure to follow to close out the year, following those steps and keeping your records up-to-date throughout the entire fiscal year to what makes the difference between a quick and a painful process.

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