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The Ultimate Year-End Financial Checklist for Busy Small Business Owners

Can you believe it? We're on the brink of bidding farewell to 2023. As the year draws to a close, it's the perfect moment for small business owners to reflect on their journey, assess financial performance, and gear up for the challenges and opportunities awaiting in 2024. As we delve into the ultimate year-end financial checklist for busy business owners, remember this: businesses that fail to plan, plan to fail. You can’t improve what you haven’t measured, and this checklist will help you measure all the right things for year-end planning and improved forecasting.

Why Should You Focus on Year-End Finances

Conducting a thorough analysis of your annual finances at the year's end is not just a good practice; it's a crucial step towards building a successful business. Evaluating the year's performance allows you to identify inefficiencies, rectify wasteful practices, and realign goals with resources for the upcoming year. Moreover, completing a comprehensive year-end financial checklist can uncover opportunities to save money and boost profits that might have otherwise gone unnoticed.

For entrepreneurs who want to easily track expenses (without stress) and be in-the-know about all the best practices that keep more money in your bank account — while less of it falls through the cracks. 

1. Run Your Financial Reports

Numbers don’t lie, and your year-end financial reports provide the transparency needed to gauge your business’s financial health accurately. Your year-end financial statements will reveal how profitable your business has been (not just how much revenue you’ve produced). They’ll also indicate where you need to make adjustments if necessary.

The three MOST important reports to generate include:

Profit and Loss Statement

The profit and loss statement, also known as an income statement, itemizes all your revenue (business income) and expenses for a given period. It reveals how profitable your business has been over the past year. If your profits fall short, the profit and loss statement shows what expenses most significantly reduced your profit.

Balance Sheet

The balance sheet reveals your business’s financial position by listing your current assets, liabilities, and equity. You can think of the balance sheet as the net worth statement for the business. The balance sheet shows the financial health of your business and indicates whether your business is in the green or in the red.

Cash Flow Statement

A cash flow statement summarizes the cash flow your business has experienced over a period of time. The cash flow statement outlines your business’s opening cash balance at the beginning of the year and ends with your final cash balance. It should itemize cash flow transactions (inflows and outflows) throughout the year.

It's time to learn how to manage your cash flow like a pro! 
This guide includes regular tasks to build into your workflow to ensure you don't run out of cash, tips on how to create and keep a budget, and the best apps to use to track expenses seamlessly. With this guide, you'll feel confident in managing your cash flow and might even be checking your bank balance daily!

2. Review Your 2023 Financial Goals

With numbers in hand, reflect on the goals set for 2023. Determine if your business exceeded, met, or fell short of expectations. This reflection sets the stage for informed goal-setting in the coming year.

Read this blog post for a step by step guide on reviewing your business in 2023 (+ free workbook) - Year in Review for Business Owners

3. Prepare for This Year’s Taxes

As the year wraps up, estimate your tax liability for 2023/24. Plan for the final estimated tax payment due and initiate preparations for the business tax deadline. Start prepping forms and documents and schedule a meeting with your accountant for strategic tax planning.

Book your first business finance consult with HM Accounting - here

4. Maximize Your Deductions: Business Expenses

As a business owner, taking advantage of business expense strategies can help you maximize your deductions to lower your tax bill when appropriate. If your business has been profitable, you may want to use some of your profits to invest in upgraded equipment or continued education for you or your employees. Strategically increasing your business expenses at the end of the year can reduce your taxable income.

With that being said, increasing business expenses simply to maximize your deductions isn’t always the right choice. In some cases, it may be in your best interest to use profits to pay yourself more in a given year, to plan for low cash flow months ahead, or retain those earnings for business stability.

A financial business coach can help you determine the best strategy each year.

5. Reduce Your Taxable Income: Tax-Advantaged Contributions

Consider maximizing contributions to retirement accounts or health savings accounts. This reduces taxable income and serves as an investment in your future.

6. Set Goals for 2024

Finally, it’s time to take what you’ve learned from year-end financial planning to set your goals and expectations for 2024. Although your 2023 goal reflections may influence your goals for 2024, they shouldn’t be the only thing you take into consideration. You should also take into account what you learned from budgeting in 2023 to set informed goals for 2024.

You can make realistic goals by using your budget and end-of-year reports to forecast predictions for sales, revenue, and expenses in 2024. Start with your expenses, as those are sometimes more predictable than revenue. From there, you can create two forecasts for your business: a conservative forecast and an optimistic forecast, and keep in mind how your variable expenses might change for each scenario.

As you’re developing informed goals from forecasting, remember to consider external factors that occurred in 2023 such as interest loan rates, rising inflation, etc. Although these external factors may be outside your control, they’ll likely reveal new opportunities or the need for new strategies in the coming year.

Also read these blog posts for guided steps on Business Goal Setting:

Need Help Completing the Year-End Financial Checklist?

For busy small business owners feeling overwhelmed by year-end financial planning, consider partnering with a financial business coach. At HM Accounting, we'll guide you through the process, ensuring you're organized and set up for success in the New Year. For personalized assistance, email me at or schedule a free 20-minute Discovery Call on my calendar - here

Don't let the year end without giving your business the financial attention it deserves. Master your finances, plan for success, and stride confidently into the opportunities that 2024 holds. #YearEndFinances #BusinessSuccess #FinancialChecklist #SmallBusinessOwners #FinancialPlanning #ProfitabilityGoals #BusinessDeductions #FinancialGoals #BusinessStrategy #YearEndReview #BusinessGrowth#NewYearFinancialGoals #SuccessRoadmap #BusinessEmpowerment

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