The end of the financial year is creeping up quickly. While you want to make sure you’ve covered all bases correctly, it doesn’t have to be a stressful time. As long as you plan ahead and get your business ready. We’ve put together a few tips to help you prepare for the end of the tax year.
Get the right advice
Just like you wouldn’t rely on an internet search for a health diagnosis, the same applies for the health of your business. Talk to your accountant or bookkeeper, and work through what needs to be done before the year-end. They can help answer questions like, what documents do I need to gather up? What sort of tax should I have paid? How much more do I need to pay and when do I pay it? Plus everyone’s favourite question – can I pay less?
Know as you go
Did you know that you can check in on your Xero data at any time? If you don’t have access, ask your accountant or bookkeeper to invite you in. You can create a P&L (Profit & Loss) statement or a balance sheet in Xero whenever you like. Not just at year-end. This lets you know exactly how your business is performing at any time. This is key to understanding and managing your business’s financial health. It’s important to know your up-to-date information all the time, not just at the end of the financial year.
Plan your year ahead
Now is a good time to work with your accountant or bookkeeper to work on a plan for the new year. They’re in a much better position to help you budget and talk about your taxes. They can also help put a 12-month strategy in place to ensure there are no surprises.
We all want to claim as many expenses as we can, but you don’t want to claim for the wrong things. One good tip is to seperate business expenses from personal expenses by using different credit cards and bank accounts. It’s also a good idea to keep sufficient records of what you have spent the money on, and store your receipts electronically as you go. Using something like Hubdoc means you can take photos of receipts and send them directly to Xero while you’re on the go.
Start the year with a clean slate
Tying up loose ends can make financial year-end much smoother. Make sure you’ve invoiced all customers correctly, and you’ve paid any due bills. Bank any cash and cheques, and check that all payments have been recognised. Also ensure outstanding bills have been entered into Xero, and all work you’ve done has been invoiced. This will make going through your records a much smoother process for your accountant or bookkeeper.
There is an easier way
A cloud accounting platform makes running your business easier and helps your accountant or bookkeeper complete your year-end accounts faster. This is because you are all working from the same set of data and it is always up-to-date – no messy backlog to deal with. Keeping on top of bank reconciliation also helps you stay in touch with what’s happening in your business. All of this, plus storing key financial documents in the cloud during the year, makes your financial year-end a breeze!
Why not contact us today to automate your business processes using Xero cloud based accounting software? We will be more than happy to assist you through this process.
There are over 500 organisations in Nigeria’s not-for-profit (NFP) sector. These are a mixture of incorporated and unincorporated organisations, depending on their income, the tax they pay and the standard of required reporting. These organisations do not carry out activities for the profit or gain of any member. Roughly 60 percent of the sector are small, unincorporated businesses who are mostly volunteer-based.
Charities and NFP organisations do not differ from any other small business. They have a mission, a budget, and a strong desire to deliver great results for their donors.
Using technology to run your not-for-profit
Just like all successful businesses, charities and NFP organisations have a strategy to achieve their goals. Technology should be integrated with the strategy to maximise the return on investment from donations.
Using an online accounting software to run your charity or NFP organisation will make it easier to focus on your mission. The old way of managing accounts with spreadsheets and paper files will only slow you down. Whereas, a secure, cloud-based system makes it quicker and easier to share information, collaborate and make decisions across the organisation.
Many charities and NFP organisations have teams of volunteers, who don’t have a lot of time to spend on the financial books. The beauty of cloud-based technology is that it is accessible anywhere, at any time to users. It means organisations can easily share expenses and donor information with board members, employees, and volunteers. As well as this, by using a mobile app manager can stay on top of workflow and send invoices or reimburse volunteer expenses on the go.
Additionally, one of the biggest headaches for many not-for-profits is compliance requirements. Whether it’s reporting to the charities register or meeting tax obligations, a secure accounting system will help you stay compliant.
Making life easier for volunteer treasurers
Playcentre Aotearoa is made up of more than 420 not-for-profit early childhood learning centres around New Zealand. They believe parents are the best teachers for their children. With parents as volunteers, families can learn and grow together.
The centres were recently consolidated into one group – Playcentre Aotearoa – and are now live on Xero nationwide. Before using Xero, each Playcentre managed their accounts with paper files and offline spreadsheets. Different Playcentres were all managing the accounts in different ways. Now, there is one consistent view of all 420 plus centres in Xero, providing better visibility of each centre.
The role of treasurer changes hands pretty often at Playcentres. Having all the financial records online allows for a smooth transition from one treasurer to another, with historic records all in one place.
Using data to make decisions
To make the best use of donations, charities and not-for-profit organisations need to evaluate what’s working and what’s not. Clean data is crucial in these organisations. Every donor needs to feel like they’re making a difference, and every dollar needs to be accounted for.
If you can show results through data, you can bring your donors closer to the impact you’re making with their help. A great example of this is The Fred Hollows Foundation’s impact calculator, which gives examples of what a certain amount of money can be used for.
There is a benefit to charities and NFP organisations running like a small business. Streamlining operations to be more efficient, setting clear goals, and ensuring accountability can help them make good decisions. People want to feel more connected to the charities and NFP organisations they support. Xero supports greater financial visibility and governance in NFP reporting using our budgeting and reporting tracking features to match expenses to their revenue and funding origins.
Partnering to maximise your impact
Partnering with other organisations to build on Xero’s great tools can only help to make your impact bigger. To really achieve change, collaboration is key.
One way you can do that is by leveraging any of the 800 app partners that integrate with the Xero platform. It could be using Spotlight for end of financial year reporting. Or using Mailchimp to send marketing emails to your database, helping to spread your message, attract donors and volunteers.
Spotlight Reporting’s tools automatically create powerful reports, dashboards and forecasts, using data from your Xero account. It provides Xero accountants, small business owners and not-for-profits with a range of reporting options that save time and effort. Organisations can customise reports to suit their needs. For example, using financial and non-financial data sources. Spotlight creates beautiful visual reports that are easy to understand, and can be sent to the Charities Register if or when required.
Streamlining NFP organisations with Xero
The Fred Hollows Foundation was started by eye surgeon and Professor, Fred Hollows, who dedicated his life to ending avoidable blindness. The Foundation now operates mobile clinics in developing countries training doctors and nurses to strengthen health systems. It also drives innovation and research.
Working in the Pacific, Papua New Guinea and Timor Leste is challenging. Many places have varying facilities and technology, especially undeveloped areas where banking and paying people is complicated.
When the Foundation moved to Xero, it was a real game-changer. The Foundation’s Chair, Craig Fisher says, “Getting our administration team onto Xero was a huge success story. All of a sudden our accounting team in NZ had visibility of what’s going on for the first time.”
We’re pleased to support amazing organisations like yours in setting up your accounting system in Xero and possibly provide expert support.
We can be reached through our email address: firstname.lastname@example.org.