Gettry Marcus CPA, P.C., comments on a list of six procedures that bookkeepers will need to perform before the end of the calendar year.
Many companies operate on a calendar year and their year-end is quickly approaching. QuickBooks performs certain year-end adjustments automatically, but other year-end procedures must be performed by a business's accounting staff.
At year-end, QuickBooks automatically "closes" all income and expense accounts to an account called Retained Earnings. In this process, QuickBooks zeros out all of the profit and loss accounts so the business starts the New Year with a zero net income.
The bookkeeper will need to perform the following year-end procedures (depending upon the company's policies):
1.Check that all the accountants' prior year adjusting entries are recorded.
2.First, perform all of the normal month-end procedures for the final month of the year. (Reconcile cash and credit card accounts, tie-in loan accounts, adjust prepaid accounts, etc.).
3.Next, run all necessary reports for the year and verify that everything appears accurate. Make all necessary adjustments and journal entries and then rerun the reports. Run A/R and A/P aging reports to make sure that all receivables and payables are valid.
4.Process 1099's for vendors, which must be sent no later than January 31st. QuickBooks 1099 Wizard (Under Vendors a Print/E-file 1099's a 1099 Wizard) can guide you through this process with its step-by-step instructions.
5.Back up data files, following company data management guidelines, and keep a permanent copy in a safe place.
6.Set the closing date in QuickBooks to the last day of the period being closed and do not release the password to anyone who is not authorized to make prior period adjustments.
Gettry Marcus CPA, P.C. is a Top 200 firm nationally with offices in Woodbury, Long Island and New York City. We provide accounting, tax, and consulting services to commercial businesses, high net worth individuals and various industries which include Real Estate and Health Care. We have one of the premier and most credentialed Business Valuation, Litigation and Forensic Accounting Groups in the New York Area. Our experience in diverse industries and a highly talented and experienced professional staff gives us the ability to share valuable insights into our clients' businesses, to better understand their goals and problems and to help them attain the vision they have for their company.
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