Accounting pre year end planning for professional practices

With 31 March and 30 April fast approaching, now is the time for the majority of finance teams to start preparing for the end of their accounting year.

Here is a checklist of things to consider:

• Work-in-progress - convert to bills, write off or provide against unbillable time, document the rationale for any acceleration or deferral of income in respect of unbilled WIP.

• Debtor levels - chase old debts, apply provisions against doubtful debts and document the rationale for doing so.
• Bank accounts - reconcile all bank accounts, look into ‘old’ uncleared items.
• Fixed assets - write off any assets no longer in use, check depreciation policy on others.
• VAT - reconcile the year’s VAT returns to your accounting records.
• Payroll - reconcile the payroll tax liability to your accounting records.
• Assets and liabilities - prepayments, dilapidations provision, expenses claims, potential claims against the firm etc.
• Accruals - ensure adequate documentation exists to support any bonus accruals you may wish to make.
• Loans - reconcile any bank loans, finance or operating leases to documentation from the lender.
• Consider what scope you have for accelerating or deferring income or expenditure, and ensure you document the rationale. Also, consider the timing of any bonus payments (see below).
• Consider whether capital expenditure can be accelerated/ deferred to maximise capital allowances.
• Compare to budget - look into variances to spot errors.

Whether you’re presenting the financial statements to the bank in order to secure next year’s finance, presenting to the firm or expecting invitations to tender for new work it is important to consider what you can do now to prepare for your year end and the production of this year’s financial statements. If you are unsure about any of these, please talk to us.