Year End Reporting 2012

When we prepare business income tax returns, we like to know we have correct and complete numbers.   This helps us to find all the deductions to which you are entitled, and to produce a tax return that will pass examination by the taxing authorities.

Some tax return preparers will not ask questions and can blindly accept whatever information you provide them.  This can cost you a lot in paying extra income taxes for missed deductions.  It can also lead to an audit examination if the relationship of the numbers creates a red flag to isolate your return for audit, and if the numbers can’t be proven to be accurate, you could be subject to more income taxes, interest, and negligence penalties for not maintaining accurate books and records.  

So below is what we ask of you to substantiate your business books and records at year end.   We have more detailed check lists for our healthcare clients where statistical data is also required for third-party reimbursement reporting.

YEAR END INFORMATION NEEDED

1.  If you use QuickBooks, provide us with the Accountant’s Copy, otherwise we need the cash receipts and disbursements history for the whole year.  Provide a computer printout of all transactions by account to show where all the money came from and how it was spent.  We call the totals from all of these accounts a trial balance. 

 2.  December 31, 2012 bank statements;  also copies of reconciliation’s of all cash and investment accounts if not done in QuickBooks.

 3.  Any 1099 interest or dividend forms received from cash or investment accounts; any K-1’s from investment in other companies.

 4.  End of year statement from any investments, which show the December 31 market value of the investment and dividend income for the year.

 5.  All quarterly and annual 2012 payroll tax report copies (Quarterly 941 or 944 annual, 940,  WT-7, W-3), or if all the wages are outsourced to a management company, a year end wage and benefits summary in total and a total compensation amount for each officer of the company.

 6.  Final itemization of insurance for 2012 calendar year.  (Worker’s compensation, Property, Liability, and Automobile).  Include copies of latest policy face sheet showing the premium billed.  Have any insurance premiums been paid ahead of the period to which they are to apply?  If so, we need a copy of the insurance billing which is being prepaid, either in part or in total.

 7.  Copies of invoices for any furniture, fixtures or equipment purchased throughout the year, and especially in the last month of the year, but not being paid until a later date.  We will need copies of the invoices if we don’t already have them.  Copies of closing statements for real estate transactions.

 8.  Accounts payable at December 31, 2012.  (These would be 2012 bills paid in January 2013 or later, plus copies of the invoices still not paid for 2012 when you send us the information.  If you are using the bill paying function of QuickBooks, this information will be part of your QuickBooks data file)

 9.  The most recent renewal copy of any notes or loans payable to any banks or other financial institutions.  (This will confirm in whose name the loans appear, the loan’s beginning balance, the interest rates and any other relevant terms).  Also need proof of year ending balance of principal owed and interest paid for 2012; an amortization schedule is ideal.

10.  Real estate and personal property tax bill copies paid or payable by the company for 2012.

 11. Copy of sales and use tax forms for 2012 sales or use tax purchases (Monthly, quarterly or annual).

 12. Any sales of equipment during the year including trade-ins?  Let us know date and amount and item.

 13. On new construction that has been completed, but not yet billed as of December 31, 2012: Please make sure you get a billing from the contractor for all work completed in 2012.  Send us a copy of anything that is billed with a December date, but not yet paid.  You can include it with accounts payable.

 14. A listing of accounts receivable at the end of the year, by customer name so that it can be traced in the event of a question as to what comprises the accounts receivable balance.  A listing of any bad debts which should be written off.  Let us know if these accounts are included in the listing of accounts receivable also.

15. A copy of the final, end of year, physical inventory counts if you maintain any inventories in your company.

 16.  Any changes in name, address, or company ownership (change in number of shares or owners of stock)