JOURNAL ENTRIES (Year End and Adjustments)
Reviewing the ledgers at the end of the financial period is vital. This is an opportunity to check the entries which have been made throughout the year are correct before running the year end closing journals. The effect of this means that the profit statement is returned to Nil to start the new accounting period. And yes, you are correct that ‘modern technology’ does this for us nowadays BUT we still need an accurate picture of the trial balance at the end of the year, so that we can make accurate comparisons for future years. So, if the ‘Advertising’ account does not reflect all advertising because some of it has accidently been assigned to ‘Accounting’ then the comparatives are not correct, a cost saving exercise to reduce Accounting fees could in fact be a waste of time, or an increase in the advertising budget might not be a good way to spend money. Just because the accounts will be reduce to Nil at the start of the new financial period does not mean it doesn’t matter. Adjustment journals are made if necessary.
TOO MANY DEADLINES TO REMEMBER?
Never miss a deadline with us, we remind you of the important dates; Confirmation Statement due date, Statutory Accounts, Personal Tax payment dates as well as submission deadlines, VAT returns, payroll submissions, PAYE payments, Corporation Tax submission and payments...these are to name a few!