Preparing for your Year-End Financial Reports

Oct 3

As 2023 comes to a close, your Account Manager will be sending you a few year-end tasks to complete. These tasks may include W-9 collection, possible year-end employee bonuses, any unknown bookkeeping items, etc.

Perhaps one of the most important tasks will be to carefully review the status of all of your current projects; especially any Retainers or Payments on Proposals. Why is this important? Your Account Manager wants to be sure all 2023 Income has been reported correctly on your Profit & Loss Statement for your CPA to file your tax return. These items ultimately affect your tax liability, so it is very important to take the time to review.

Retainer Review

By reviewing your open Retainers, your team can help determine if any design time or product invoices need to be created before December 31, 2023. Did you miss a possible shipping invoice or do you need to refund any products to a client? This process will also help you determine which projects can be closed in your Project Management software and if any invoices need to be followed up on or rolled into Bad Debt. While this task may take some time to complete, it’s imperative to the health of your financial reports that it be thoroughly reviewed and completed prior to December 31, 2023.

Payments on Proposals

Along with reviewing your Retainers, if you accept Payments on Proposals (Business by the Book does not recommend this as a best practice), you also need to thoughtfully analyze each project and convert any paid proposals to invoices if it is appropriate income for 2023. Again, we are striving to account for all appropriate income and to offset the Cost of Goods Sold (COGS) on your 2023 Profit & Loss Statement. Your Account Manager can assist you with this task if needed prior to December 22, 2023.

November & December Product Income

Finally, if you receive a client payment on a large product invoice in late November or December, reach out to your Account Manager to discuss the implications of this income. If you receive a large payment, but the COGS are not expected to be charged until 2024, your 2023 income may be inflated. Our team can work with you to accurately record the incoming payment versus the COGS.

Key Takeaways

Our team understands the last few months of the year can be hectic and stressful, and we are here to help you in any way we can. Our goal is to provide you with accurate and sound financial reports, but we need your input and feedback to wrap up your Year-End Financial Reports. We also recommend that you reach out to your CPA to schedule a tax planning call during the fourth quarter.

Carve out time to examine your projects, make necessary notes, create invoices, and if needed, reach out to your Account Manager for help. Our office closes on December 22, 2023 for the Holiday Break.

Here is a summary to-do list for you to prepare to close out your 2023 Financial Reports: