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19 things a Virtual CFO does as the financial year ends

Posted 7 years ago in Advisors by
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I typically get asked if I get busy around this time of year, tax time.

The truth is though, I am not busy because it’s year end, I’m busy because clients want to know what their final profit is going to be as soon as possible so we can get started planning for next year, knowing what we achieved this year.

As a Virtual CFO, my job (amongst others) is to help business owners make more informed decisions by increasing their financial control and visibility.

To do this, year end is really important because it’s where we prove what the efforts of owners and management produced. And getting great outcomes is why most of us are in business!

A Virtual CFO oversees financial teams to make sure the profit figure reported is a true and fair reflection of the company’s performance for the period. I also make sure their balance sheet records all the assets and liabilities of the company to make cash planning for the next year as accurate as possible. So to help, here are some of the things we look for at year end to make sure we know the 30 June accounts are the right place to start our 2017 Financial Year Planning.

1. Make sure you capture all your revenue and don’t record revenue you have billed but haven’t earned yet

2. Record all supplier bills

3. Write off bad debts

4. Record depreciation

5. Adjust for pre paid expenses such as insurance and the increasingly popular software subscription

6. Run a stock take

7. Bring up Accruals

8. Bank Rec

9. Balance Sheet Reconciliation

10. Ensure all liabilities are recorded

11. Ensure tax liabilities are recorded

12. Revenue – Is there any unearned revenue?

  • Did you raise an invoice early for income you didn’t earn
  • Forward orders
  • Back orders?

13. Review AP Ageing to see if you accidently double counted some payment

14. Reconcile loan accounts and determine what the return to shareholders will be (all business owners want to know this one!)

15. Review Long Service Leave and other employee entitlements and make sure they are correctly recorded

16. Translate Foreign Currency Gains (Xero can do this for you)

17. Reconcile Superannuation in your accounts to what you actually paid

18. Reconcile the wages expense to what you actually reported and paid

19. Determine if there is capacity left in capital and divisional budgets and decide to spend the cash or include in next years plan (remember the $20k instant asset write off when planning this though)

Once all this is done, we can start analysing the result and planning for what needs to change to get the owner’s expected return next year.

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