It’s that time of year: the time to enjoy hot cocoa by the fire, build a snowman with the kids…and square away the loose ends of your business. Doesn’t that sound fun? Well, if you define “fun” as being prepared for 2011 then, yes, it will be fun.
Here are four end-of-year tasks that will help you start 2011 off right:
1. Revisit that classic holiday tale: your 2010 financial documents.
Let the ghost of business past guide you through a review of your 2010 cash flow statement, income statement, and balance sheet. If you don’t have the time to prepare these documents, consider hiring someone to prepare them for you. Here are the lessons you’ll learn…
A) …from your cash flow statement: whether your business’s net cash flow went up or down, and where the money went
B).…from your income statement: get a snapshot of the year with this simple formula: Revenue minus Expenses = Profit (or Loss)
C)…from your balance sheet: a summary of your business’s assets, liabilities, and equity.