As the year draws to a close, controllers play a crucial role in ensuring their organizations’ financial health. The year-end is not just about wrapping up numbers; it’s about ensuring financial accuracy, compliance, and preparedness for the upcoming year. For controllers, having a thorough checklist can streamline this process while lessening risks. Here’s a comprehensive year-end checklist for controllers to ensure smooth financial operations that position the business for future growth.
Year-End Checklist for Controllers
Review Financial Statements
As a standard part of year-end, controllers must ensure that all financial statements are complete, accurate, and in compliance with accounting and compliance standards. This process includes reviewing balance sheets and income and cash flow statements. The controller will check consistency across reports and compare performance against budgets and forecasts to identify any significant variances. Understanding why these variances occurred will provide insight into the company’s operational efficiency and financial health.
Reconcile All Accounts
Account reconciliation is one of the most critical year-end tasks for controllers. This step includes reconciling bank and credit card statements, accounts payable and receivable. Ensuring the general ledger matches all supporting documents is essential to prevent discrepancies and potential errors in financial reporting. Remember also to reconcile intercompany transactions, fixed assets, and payroll accounts.
Evaluate Tax Obligations
Tax planning is a crucial component of the year-end checklist. Controllers must review current tax liabilities and ensure all tax filings, payments, and documentation are up-to-date. This effort includes corporate income, payroll taxes, and applicable local or international tax obligations. Preparing for potential audits and understanding upcoming changes in tax law can also help mitigate future risks.
Assess Cash Flow Management
Year-end provides an excellent opportunity to evaluate the company’s cash flow performance over the past year. Controllers should assess the company’s liquidity and working capital management to ensure sufficient cash for operational needs. This review will highlight areas that may require improvement, such as reducing client payment terms or negotiating better payment terms with vendors.
Review Internal Controls
A controller’s role involves ensuring strong internal controls are in place to protect the company from financial mismanagement or fraud. Year-end is the perfect time to assess whether existing controls were effective throughout the year. If gaps are identified, now is the time to implement necessary improvements to safeguard the company’s assets and ensure accurate financial reporting in the coming year.
Prepare for the Annual Audit
If your company undergoes an annual financial audit, begin preparing early. Organize all supporting documents to ensure financial statement accuracy and prepare explanations to address any significant changes from the previous year.
Proactive audit preparation reduces stress and ensures a smoother process, which in turn helps maintain investor confidence and compliance with regulatory requirements.
Evaluate Budgets and Forecasts
Before closing the books on the current year, controllers should also evaluate how well the company adhered to its budget and forecasts. This oversight helps controllers understand how the business manages resources and meets its financial goals. Controllers should use this evaluation to help plan for the next fiscal year, adjusting projections to reflect current market conditions and organizational goals.
Employee Payroll and Benefits Review
Ensure all employee compensation, including bonuses, commissions, and benefits, are accurately recorded. Double-check payroll records to avoid any discrepancies. If your company offers retirement benefits or other incentives, document contributions properly and balance employee accounts.
Close Out Fixed Assets and Depreciation
Year-end is a good time to review the company’s fixed asset register. Record any new assets and calculate depreciation correctly. Write off any fully depreciated assets or those no longer in use. This step improves the accuracy of your balance sheet and positively impacts tax planning.
Looking for a Controller?
For controllers, the year-end process is an opportunity to close out the current year and set the stage for success in the next. By following this comprehensive year-end checklist, you can ensure financial accuracy, regulatory compliance, and operational readiness for your company. If you’d like to apply these skills in a new setting, CPS Recruiting offers controllers opportunities to connect with stellar companies. Contact us to find out how we can advance your career.
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