Breaking the Year-End Stress Cycle – Part 2: Practical Steps

In Financial Transformation by Tamara

Reading Time: 7 minutes

In the first part of this two header we looked at the causes of stress in the year-end process and gave you some simple tips to reduce the amount of upset this causes.

Without a doubt, it can be a difficult and challenging time, but there are some really useful practical tools you can use to make the year-end quicker, easier and as a result less stressful.

So in this post, we are looking at the practicalities of year-end and specifically what actions you can take now to improve the whole experience.

Our aim here is to reduce the uncertainty and make sure you have real, tangible steps you can take that will result in you having a much more pleasant and certainly less stressful time.

So in this post, we are looking at;

  • Breakdown your tasks
  • Understand your dependencies
  • Pre-year-end meeting and risk assessment
  • Checklist documents and responsibilities assigned
  • Notify suppliers
  • Review outstanding purchase orders
  • Sort out your prepays and accruals schedules
  • Do your fixed asset register as you go along
  • Automate where possible

Before we get stuck in, if you'd like to watch our recent Financial Transformation Live on how you can break the year-end stress cycle, we've included it below - otherwise, skip past and begin reading!

Breakdown the tasks

Tip one is to break down your tasks into manageable, bite-sized sub-tasks.

If you spend too long looking at the whole year-end project, then you will simply become overwhelmed but by breaking it down you can start to see how it is much more achievable.

This breakdown will help you to understand what needs doing, when and how long it should take but don’t think that you can sit down one afternoon and have a complete project plan in place.

Instead, use your breakdown as a kind of living document and add or remove tasks as needed. It doesn’t need to be done on an all-singing and dancing system. A simple spreadsheet like the example above will do fine.

Understand your dependencies

So now you have your breakdown you can start to see the tasks and how long they are going to take but something else will appear.

You can start to see where dependencies are.

For example, you may need to wait on a project accounting module to close before you can work on your WIP, or you may need to wait for invoices to appear before you can close your prepaccs schedules.

Understanding the order that things need to be done is helpful because it means you can either forget about things until they actually need to be done, can prepare the ground ready for when information becomes available or you can put more effort into things that are likely to become blockers.

Pre-year-end meeting and risk assessment

Before you get to year-end make sure you have at least one pre-meeting. You may want to invite your auditor to find out if there are any specific areas they want to concentrate on and you may want to include particular department heads if there will be work for them to do.

But mainly you’ll need to work with your team to understand who is doing what and when.

It’s also important to do a risk assessment here and this is where your auditor will come in helpful because they can tell you the areas that will be of specific concern and as such, higher risk.

Checklist documents and responsibilities assigned

Once you have broken down your tasks and you know when they need to be done and you have had your pre-year-end meeting, you will be able to assign responsibilities.

The temptation here is to try and do it all yourself but that’s a big mistake.

Yes, we have heard all of the arguments that others won’t do it as well as you, they are stretched and they don’t have your experience but the truth is you are going to need help.

So make sure you give people tasks that are a little bit of a stretch so that they develop their skills and feel that they are contributing and don’t take it all on your shoulders otherwise you could get overwhelmed and stressed.

Notify suppliers

One of the things that tend to hold up year-end is waiting for invoices from suppliers. Now in many cases that might not be an issue but where your business has a lot of accounts payable activity and the invoices are sizeable then a few late invoices can make a material difference.

We’d suggest getting in touch with your suppliers and letting them know it is your year-end and asking if they can speed up the process. Remember that you are dealing with another accounts team so they will probably be sympathetic to your plight!

Review outstanding Purchase Orders

If you run a PO system then you will want to review your outstanding transactions.

This is something that you can certainly do ahead of time because if you have outstanding POs from ten or eleven months ago then there’s clearly something wrong and there’s no point in waiting until the end of your financial year to find out what it is.

The good thing is that this is certainly a job that can be delegated and you should only really have to get involved in the more tricky cases.


Sort out your prepays and accruals schedules

The best piece of advice we can give here is to make sure you maintain a prepays and accruals schedule every month of the year.

There are two reasons for doing this; the first is that it makes it so much easier at year-end if you only need to update one month rather than looking back twelve and the second is that you experience the learning effect from doing something every month rather than waiting until the end of the year to do it.

Do your fixed asset register as you go along

Another thing that can be done ahead of time is the fixed asset register but we’d suggest that when you do this you take a year-end approach.

So most businesses will do a fixed asset register monthly or maybe quarterly. If you are doing it yearly then you really need to move to a monthly pattern for the same reasons you must do your prepays and accruals monthly.

But as you do your monthly fixed asset, think about what the auditor will want to see. They’ll be expecting to have a folder of invoices for all of your acquisitions and some evidence for write-offs and disposals. So build this folder as you go along.

Each month put your evidence in a folder with each file clearly marked in the title which asset it relates to. That way when it comes to year-end you won’t have any work to do and you can hand over your folder with a smug grin on your face!

Automate where possible

Well, we would say that, wouldn’t we?

But joking aside, automation is a key tool when it comes to making your year-end process quicker, slicker and less stressful.

Look at ways to speed up purchase invoice processing, and sales order processing and think about implementing a fixed asset module.

Automate your bank recs and builds reconciliation spreadsheets or dashboards because automated management reporting can take a lot of weight off your shoulders.

Consolidation can be a black hole that soaks up your time and can result in many late nights elbows deep in a series of spreadsheets. Do yourself a favour and if you are responsible for a multi-entity organisation then think about getting an automated consolidation module in place well before year-end.

There is some good news here though. Often your current systems will have automation options built-in and all you need to do is to configure them.

Some will be add-on modules that will cost a bit extra but you can easily justify that against the value of your time saved.

And if your current system doesn’t have any options then there are a lot of third-party apps available on the market. Just give us a call and we can point you in the right direction.

Add a sprinkle of pragmatism

Now as accountants we naturally want everything to be 100% accurate and correct but the real world isn’t like that so now is the time to sprinkle on a little pragmatism.

For example, is it worth delaying the whole year-end process just to wait for an invoice? Would it be better to make an accrual instead?

Make sure you concentrate on the important things. things that have a high value or high impact within the organisation.

Let some of the little stuff go because if it is under their materiality level your auditors won’t care and if it is only a small value or small impact then it isn’t going to affect your results.

Organisation and knowledge are the keys

If you have never run a year-end before or you are a little rusty then it can certainly be a challenging time.

There’s a lot to think about and so many stakeholders involved that it is easy to find yourself getting overtaken by events.

However, it really doesn’t need to be that way. 

As we have seen in our two articles, organisation makes a huge difference to your year-end and getting things done early, delegating tasks and making sure you understand what needs to be done when all play their part.

Reducing manual processing by adopting automation is also important.

But above all, the key to reducing stress at year-end is understanding.

To this end, we have produced a special episode of our very successful Financial Transformation live series dedicated to breaking the year-end stress cycle webinar here

And a quick reminder that you can find part 2 of this blog here and there are lots of other resources to help you run and develop your finance function.

And of course, if you need help from experts then we are only a phone call away.

Financial transformation can be challenging

Are you ready to join us?

Sign up to receive alerts for our live sessions using the form below. The live event information will be sent out 48hours before via email. If you don’t have a chance to join the live session, don't worry, we will send you the recording via email.