Best Year-end practices for Certified Management Accountants & Bookkeepers

Best practices for closing year-end accounts

Year-end has a different meaning for the accounting industry. For the normal population, it means holidays, New Year bashes, travels and trips, parties, and get-togethers. However, for accountants and bookkeepers, it means busy days at work or even working from home. They are required to complete the year-end accounting and bookkeeping for their clients.  

It is the year’s busiest time for accountants, tax experts, and other people associated with the accounting industry. They struggle with reviewing clients’ books, preparing taxes, and having a consulting session with the clients to discuss the financials of the year gone by and forecasting for the year ahead. 

As the year-end is close by, bookkeepers and accountants will jostle to close their clients’ books to prepare a final report for insights into their performance. Moreover, these are the times when a small mistake or missing a step may cost you highly in terms of money, time, and energy. Therefore, we intend to provide you a checklist to be aware of each step of the year-end account closing process.  

In the following passages, we discuss some of the year-end accounting best practices that accountants and CA firms must incorporate to ensure that their clients continue to trust them: 


Accountants must keep track of the end of the year and prepare a checklist for accounting 


Instead of stressing about the year-end accounting processes and workflows, it is good to prepare yourself. Bookkeepers must ensure that they are ready for the additional work. Such work is in requirement for the year-end accounting, including reporting, compliance of statutory requirements before the due dates. Also keeping in mind the discussions with clients.  

Before the year-ending, accountants must ensure that they have completed all the invoicing, making payments, following up on outstanding payments. They should also focus on writing off overdue invoices, and recording expenses for each client. Once all these steps are accurate and in place, only then can accountants start with the year-end closing procedure.  

Bookkeepers must create and maintain a checklist for the end-of-the-year accounting process. This will ensure that the entire team is on the same page. Also should ensure that the team remains organized as well as disciplined for dealing with the required tasks and deadlines. Such checklists ensure that accountants know their duties and responsibilities to deliver consistent accounting services to their clients. Furthermore, accountants must share such a checklist with the clients so that they are also aware of how busy their accountants would be during this time.


Accountants must always strive for accuracy and reconciliation of accounts


The key thing for accountants and bookkeepers is to keep all the transactions accurate, complete, and up-to-date. Certainly for this, they must review all the documentation of the year to check if those have been recorded correctly. Above all, ensure that all the transactions recorded in your accounting software match the entries in bank statements and credit card statements.  

The reconciliation process of bank statements is critical since it identifies any inconsistencies, errors from the bank side or clients’ side, or any possibility of fraud in the account. Check if all the invoices and bills have been recorded, cheques have been encashed, as well as pending payments have been done. Accountants must ensure that accounts are matched with the right activities as well as are not wrongly categorized, as it may lead to a messy system.  

In particular, check that the account types follow the reporting requirements, no duplicate accounts exist, accounts are named appropriately, inactive and unused accounts are removed. Entries are accurate and under the correct headings. After completion of reconciliation, you can close those books, so that you do not have to look into them again. In addition to this process, you must be confident that no errors exist and all the transactions are in account for in the books.   


Accountants must review the financial statements and prepare reports for client discussions 


Once the reconciliation of bank statements is completed, accountants must review all the financial statements to check for any errors. They must review the Profit and Loss Statement, Balance Sheet, Expense Report, Cash Flow Statement, Payroll Summary. Also they must review sales Report, Report on Budget versus Actual, and Tax Summary. They must also check each number and make sure that it is correct.  

The bookkeepers must look for any significantly high or low numbers. Such numbers that seem out of place, negative account balances, accounts with huge gaps from the previous year, and other accounts that they consider key for the client.  


Accountants must have a year-end meeting with clients for strategic discussions 


It is time for the accountants to meet with the clients. They should meet to discuss the current year’s numbers and plan for the next year. Bookkeepers must discuss any big numbers that went awry in the current year. Such numbers can be taken care of in the next year. They must discuss the financial projections. The discussions should be for the next year depending on the business trends expected in the year to come.  

Accountants and clients must sit together to review all the different types of statements prepared to provide the following insights: 

The current year’s performance 

What went as per the plan and what went wrong, which can be improved this year for better profitability  

Any differences in the budget versus the actual figures 

An understanding regarding the goals that were met and those that remain unmet 

An idea of what strategies worked well and what did not  

After reviewing last year’s performance, accountants and clients must create a budget for the next year. They should also identify the key strategies which should work upon to increase the profits. Identify the new business goals and the plan of action to achieve those goals.  


Key Takeaways

Accountants as well as bookkeepers must use these key bookkeeping best practices to ensure accurate, complete. They should also keep in mind the timely accounting and bookkeeping for the year-end accounts. If you remain updated with the daily, monthly, and quarterly bookkeeping and accounting, then the year-end accounting would not require much effort. Throughout the year, efforts will ensure that you can close the books and review the reports easily and quickly, without any hassles. Therefore, this is a key requirement since your clients are dependent on you for year-end accounting and compliance with statutory reporting and tax-related requirements.  


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