31 December is the most common accounting year end. Which is not surprising. Only 31 March, which near enough coincides with the tax year, has anything like the same logical attraction.
But 31 December is a horrible year end. It is bang smack in the middle of a holiday period and yet some essential tasks have to be done. It's vital that any stock in hand be counted and accurate records be kept of what it is and what it is worth. HM Revenue & Customs now think these notes are part of the basic book-keeping records of a business.
It may also be the last chance to get some billing done to record the sales made in the year. Alternatively, there may be purchasing to do to close this year's budget.
There's also cash flow to consider. Do you want to pay people before the year end and so show a low cash balance on your accounts, or would it be better to delay payment and have a bigger bank balance on display?
These can be important planning issues for tax, for raising funds or for preparing to sell the business (as many people eventually do). None should be treated light-heartedly and there is still just about time to discuss them. If you want to, give us a call.
And whether you do call, or not, please remember to keep those stock records, all year end supplier statements and to make a very careful backup of your year end accounting records. This is the case, by the way, even if you keep them manually and not on a computer. It's just that in that case the backup is called a photocopy.
Date:20 December 2005
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