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Four Ways to Make Closing the Books at Year-End Less Stressful in 2023

By Accounting Resources August 16, 2022

It’s never too early to start planning for year-end and tax filing season. Before we know it, the summer has whizzed by, and we are heading into fall and the start of the year-end crunch.

It may sound obvious, but the most effective way to relieve year-end stress is to get and stay organized all throughout the year. This will eliminate the last-minute stress of emptying the shoe box full of paper and trying to classify your expenses by relying on faded receipts during the closing process.

It can feel daunting and overwhelming if you are not naturally organized, so the most important step is to get started.

1. Start by eliminating paper

Scan important paperwork and digitize receipts. This will make finding documents less time-consuming and will save physical storage space.

2. Embrace the power of digital tools

Excel is a great tracking tool for both the novice and the pro. You can easily create itemized workbooks, enter transactions, and eliminate the need to search through stacks of paper when tax time hits. Having everything you need at your fingertips is a sure way to make the end of the year less nerve-wracking.

3. Stop using paper checkbooks – invest in accounting software

Like any new software system, there is an investment of time upfront to set up accounting software, but once you do, it will save you hours of work each week by handling time-consuming tasks. These products integrate with your online banking systems so you can quickly and easily download transactions rather than entering them manually. And most even generate important tax reports – for example, sales and use tax and payroll tax reports.

At the end of the year, having organized, categorized data makes it that much easier for your tax accountant to file your return and calculate all of your available tax credits.

4. Automate repetitive tasks

When you have your accounting software up and running, automating tasks is a great way to eliminate all the sticky note reminders covering your desk. Need to pay a supplier monthly? Want to periodically transfer money to your retirement account?

Your time is best spent focusing on growing and strengthening your organization, not reconciling bank statements, or worrying about year-end requirements. That’s where ARI can help.

What is the closing process in accounting?

  1. Close revenue accounts to income summary
  2. Close expense accounts to income summary
  3. Close income summary to retained earnings
  4. Close dividends to retained earnings

Some of our clients have found that their CEO or Executive Director spends as much as 75% less time focused on accounting when they outsource to ARI. And it’s not just time you’ll save. You’ll very likely find it’s less costly to partner with us than to staff an internal accountant. Check out all 10 benefits of outsourcing your accounting and bookkeeping needs.

 

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