Spring Clean Your Business Finances
Spring is usually when we clean out cupboards, clear the garage and finally deal with the things we have been ignoring.
Your business could probably use the same treatment.
By September, you are a few months into the new financial year, making it a great time to check whether your business is starting the year the way you intended.
Here are a few areas worth cleaning up.
Review Your Subscriptions
Businesses accumulate subscriptions surprisingly quickly.
Software.
Apps.
Memberships.
Cloud storage.
Industry platforms.
Review what you are actually using and cancel anything that no longer provides value.
Saving $50 a month may not sound exciting, but several unused subscriptions can quickly add up.
Chase Your Debtors
How much money are customers currently owing you?
More importantly, how old are those debts?
Review your outstanding invoices and follow up overdue accounts.
The work has already been completed. The business deserves to be paid.
Review Your Pricing
If supplier, wage and operating costs have increased but your pricing has not, your margins may already be declining.
September is a good opportunity to review pricing before another busy year gets away from you.
Clean Up Your Bookkeeping
Are your bank reconciliations current?
Are transactions sitting uncoded?
Are personal expenses mixed through the business?
Are outstanding invoices accurate?
Clean books give you reliable information.
Messy books give you guesses.
Check Your ATO Accounts
Review outstanding:
- BAS obligations
- PAYG instalments
- Income tax
- Superannuation
If something is outstanding, address it early rather than allowing it to build.
Look at Your Profit
Do not wait until June to discover how the year went.
Compare your performance with:
- Last year
- Your budget
- Your expectations
If something has changed significantly, find out why now.
There is still plenty of financial year left to make adjustments.
Review Your Processes
Not every business problem is financial.
Ask your team:
“What do we do every week that wastes time?”
You may uncover duplicated data entry, unnecessary approvals, manual processes or software that is not being used properly.
A small process improvement repeated hundreds of times can create a significant benefit.
Check Your Goals
Finally, revisit what you wanted to achieve this financial year.
Are you still working towards it?
Or did July get busy and the plan disappear?
September gives you plenty of time to reset.
The Bottom Line
A financial spring clean does not need to involve dramatic changes.
A few hours reviewing your numbers, systems and obligations can uncover opportunities that would otherwise remain hidden.
If your business finances could use a spring clean, PLH Accountants can help you understand where things stand and what deserves attention next.