Whether you’re a small start-up just learning the ropes or a more seasoned business, the end of financial year (EOFY) can be a very hectic time for any company. Luckily, ERP systems are here to simplify and speed up your processes.

What is EOFY?

The financial or fiscal year is a 12-month period that governments and businesses use for calculating financial statements and accounting taxes.

When the financial year comes to a close, the Australian Tax Office (ATO) requires businesses to accomplish their books and submit their tax return which is a summary of their year-long expenditure and income. During this time, businesses also prepare financial reports to review their performance and plan their budgets for the next financial year.

When does the financial year start and end in Australia?

In Australia, the financial year ends on 30 June and begins on 1 July. However, there are also different lodgement dates which will depend on the business or the individual:

• Sole traders and self-employed parties must submit their individual tax returns from 1 July to 31 October

• Partnership tax lodgement dates are also from 1 July to 31 October

• Most companies must submit their company tax returns before 28 February

What do you need to accomplish at the end of the financial year?

There are several tasks that are done at the end of the financial year. Keep track of these essential to-dos and requirements:

1. Work on financial documents

During EOFY season, accomplish reports, summaries, and statements such as:

• Balance Sheet and Trading Profit and Loss statement

• A reconciled record of accounts receivable, accounts payable, bank accounts and loans

• Business activity statements (BAS) that is consistent with your Goods and Services Tax (GST) account

• Pay as you Go (PAYG) Withholding statement that is consistent with payroll records

2. Manage salaries, awards, and payroll

Most of the financial records mentioned above can only be done by taking care of workforce finances as well. You must also settle staff payments and outstanding invoices to contractors and freelancers. Salaries must also be in line with the appropriate awards and other statutory requirements.

3. Take stock of inventory

Check up on your inventory and equipment so that you’ll know which expenses will be allocated to stocks and assets. This also allows you to determine the closing value of your inventory.

4. Prepare reports for accountant

If you have an accountant that handles your tax return, you must provide the documents above and other reports such as Aged Trade Debtors, Aged Trade Creditors, Inventory Stock Value, Job Work in Progress, Asset Purchases & Disposals, Depreciation Schedule, Payroll Financial Summary for all Staff, and many more.

5. Submit requirements

Once all these documents are in order, you can lodge the following on your own or with the help of your accountant:

• Income Tax Return

• BAS statements

• PAYG Withholding payment summary report

This is a general list of the key tasks to be done during the end of the financial year but for more detailed steps, you can check out our quick EOFY checklist.

What are the benefits of using ERP systems for your EOFY processes?

1. Simplifies financial record-keeping

An ERP system is a centralized platform, capable of capturing and storing data anytime and anywhere. During the end of the financial year, businesses can access and review up-to-date data from across various departments in one system.

2. Streamlines financial management

An ERP system improves financial management, allowing easy input and access to financial data. Some processes can also be automated within the system. Generating reports and changing the financial year can all be done with just a click of a button, reducing the time it takes for employees to accomplish it.

3. Seamlessly integrates different aspects of the business

The end of the financial year is the best time to see how your entire business is doing, across all your departments. During EOFY, you submit financial documents that will require you to reconcile records from different aspects of your business.

In an ERP solution, financial modules are completely in sync with a payroll module or warehouse management module, and all other modules within the system.

4. Provides in-depth insights

As the financial year comes to a close, it’s important to review your business performance and plan for the next financial year.

Business intelligence and data analytics can provide you with the insights you need and ERP systems can make all the data you need easily accessible.

While ERP solutions already have report-generating functions, they can also be integrated with other business intelligence and analytics applications.

Get ready for EOFY with your ERP system

If you’re a business without an ERP system, EOFY is the perfect time to consider and assess implementing one. You can welcome a new financial year with a system that will help your business perform at its best and simplify your next EOFY.

For existing AlphaBiz customers, we also provide Sybiz Vision support, MYOB Advanced support, and MYOB Exo support for all EOFY-related concerns.

Are you ready to make your end of financial year a success? If you have more questions, contact the AlphaBiz team at admin@alphabiz.com.au or at 08 9277 2226.