As we approach the year end, Habile Consulting has considered it pertinent to put together some key things the SMEs are suppose to do in order to make the new year a much better one.
Listed below are some of those key year end related activities that should be carried out by small and medium enterprises:
- TRACT YOUR INVENTORY
Inventory Count is one of the internal controls ordinarily put in place by a business entities, especially, one with high turnover. However, Stock take is more important at year end because of the statutory audit and for the management of the entity to know what they are going into the new year with.
2. CLOSE OUT ALL YOUR RECEIVABLES AND OTHER RELATED BOOKS
It is also very good to look through your debtors’ list and determine those that have ability to pay you immediately. Business organisations get lower turnover in December compared to some other months but January is not any better. Get in as much money as possible in December without damaging your relationship with the owing customers because January may not be a good time to start asking debtors to pay up.
3. SCHEDULE YEAR END AUDIT
You need to also ensure that Account section of your company are in readiness for the annual audit exercise, most especially, if your financial year end is 31st December. Your auditors should also be notified early enough to make them prepare and start your audit by January or February. Your auditors may also want to witness your year end stock count exercise mentioned in (1) above. Conducting your audit on time will give you opportunity of filing your annual tax and other statutory returns at a good time and this will make you pay your taxes and have your tax clearance certificate at a very good time as well. It will also free you from Late returns filing penalties and interest on
4. RE-NEGOTIATE UNFAVOURABLE AND EXPIRED DEALS
It is a good period to go for renegotiating your loans and other financial agreements, especially, if it is expiring at year end. Invite the other party to a round table for discussions that will position your SMEs in a better place next year. You also need to be proactive as any other party too could invite you for same discussion because of their business too.
5. END OF YEAR SALES AND GIVEAWAYS
SMEs with some slow or non moving items could have them used as giveaway at this time. Selling such products with considerable discount to ensure they are not left in the showroom until they expire is an intelligent thing to do. Selling such at this time will also serve as sales promotion for the business. This is even very good especially when the company has made very good profit for the year.
6. SHARE YOUR YEAR END GIFTS TO CLIENTS/CUSTOMERS
Since you have enjoyed some patronage and recommendations from client/customers throughout the year, it is only moral that you will remember to show your appreciation to them in this holiday season. Depending on your budget and how rich you are, you can do greeting cards, hampers, wrist watches, wall clocks or any other worthy items.You may also want to remember to do some donations especially, to the motherless homes and other less privileged around you. This may be under your CSR program.
7. HOLD END OF YEAR RETREAT
This gives opportunity to low and middle level employees and the senior management personnel to interact on old and new strategies of the company. It gives the common staff of the organisation the avenue to bring ideas as to improving the fate of the company. It is also an avenue to have some refreshment and every member of employee to freely express themselves for social benefit and the growth of the SMEs.
8. HOLD BUDGET SESSIONS
Budget sessions are opportunity to evaluate current year’s financial performance and set target on the incoming year’s income and expenditure. This is the target that is meant to be periodically evaluated to see if actual performance is in line with the set target. If not, the variance is meant to be investigated. Every unit is to be carried along when the budget is being drawn up in order to make same easily implementable and make each unit head more accountable as they are aware of the target they are meant to achieve.
9. REWARD LOYAL AND PERFORMING EMPLOYEES
End of year also presents avenue to reward the employees that have been noted for being loyal and performing in the course of the year. This could be achieved by giving promotions and/or bonuses to those who deserve it. It is also important to consider encouraging team bonding and team work in doing this. That is you can also reward unit or team or department together. That is interpersonal reward.
10. PAY UP OUTSTANDING BILLS
Bills considered not good enough to be carried forward into the new year should be paid up as January may not be suitable to slate for settling bills due to the economic look of businesses generally at the beginning of the year. You can also ask for some discount at this time as your creditors too will want as many debtors as possible to pay them up. This will however depend on how liquid your SMEs is at this time.
To get more information on the subject matter an other issues that relate to business, economy, finances, audit, taxation, accounting and so on, kindly contact us by visiting our website www.habileconsulting.com or send email to email@example.com or call us on 0818 564 1411