September Financial Reset
Key Takeaways
September is a good time to review your business finances and make sure your records and financial information are up to date.
Reviewing your bookkeeping, cash flow, outstanding payments and upcoming tax liabilities can help you identify anything that needs attention before the end of the year.
Looking at your figures now can do more than keep your records in order, it can help you understand how your business is performing and make better decisions for the months ahead.
Why September is a good time for a financial reset
September often feels like a fresh start for businesses. The summer holidays are coming to an end, teams are returning to their usual routines, and attention turns towards the final few months of the year.
During the summer, bookkeeping and finances can sometimes fall behind. Holidays, staff absences and changes to your usual working routine can all mean that financial tasks are put off until later.
With four months of the year remaining, September is a good opportunity to bring your finances back into focus. Reviewing your records now can help you understand how your business has performed so far, identify anything that needs attention and give you time to prepare for the months ahead.
Bringing your bookkeeping up to date
The first step in any financial review is making sure your bookkeeping is accurate and up to date.
Sales and purchases invoices should be recorded, business expenses entered and bank accounts reconciled where possible. Missing or incomplete records can make it difficult to get an accurate picture of your financial position and may result in important information being overlooked.
Keeping your bookkeeping up to date throughout the year also makes it easier to monitor your finances, prepare VAT returns and keep track of your tax obligations.
If your bookkeeping has fallen behind over the summer, bringing your records up to date now can put you in a stronger position for the final few months of the year and give you a much clearer picture of where your business stands.
Understanding your cash flow
Once your bookkeeping is up to date, you can get a clearer picture of your cash flow.
Understanding when you expect to receive payments and when you need to meet your financial commitments can help you identify pressure before it becomes a problem. It is important to look beyond the balance in your business bank account, as upcoming expenses, payroll, VAT, tax payments and outstanding customer invoices can all affect your cash position over the coming months.
Reviewing your cash flow forecast can also help you plan ahead. If your income or costs have changed since the beginning of the year, your original forecast may no longer reflect your current position. A business can be profitable on paper and still experience cash flow pressure, so keeping an eye on both is essential.
Reviewing your financial performance
September is also a useful point to look at how your business has performed so far this year. Reviewing your turnover, profit and expenditure against your expectations can help highlight where the business is performing as expected and where there may be areas that need attention.
For example, an increase in turnover does not necessarily mean an increase in profit. If your costs have increased at the same time, your overall profitability may not have changed as much as expected.
It is also worth looking at which areas of the business are contributing most to your results. Are certain costs higher than expected? Are your margins changing? Are there areas where you could be working more efficiently?
Keeping on top of outstanding payments
Another important part of reviewing your finances is understanding what money is still owed to your business.
Outstanding invoices can have a direct impact on your cash flow, particularly if customers are taking longer than expected to make payment. Reviewing your sales ledger can help identify overdue invoices and highlight where payments may need to be followed up.
Maintaining effective credit control throughout the year can help reduce delays and give you greater certainty over when money is expected to come into the business. If you regularly experience late payments, September can also be a good time to review your payment terms and consider whether any changes could improve your cash flow.
Planning for upcoming tax and VAT liabilities
It is important to consider any upcoming tax and VAT liabilities as part of your financial planning. Knowing what payments are due and when they need to be paid allows you to account for these costs in advance and avoid unexpected pressure on your cash flow.
For VAT registered businesses, keeping your bookkeeping accurate and up to date is particularly important. Your records need to support the figures included in your VAT returns, which must be submitted to HMRC using Making Tax Digital compatible software by the relevant deadline.
Planning for these liabilities in advance can make it easier to manage your finances and ensure you have funds available when payments are due. A September review gives you time to put money aside and avoid being caught out later.
Looking ahead
Once you have reviewed your current financial position, you can start planning for the rest of the year. Updating your financial forecasts based on your actual performance so far can help you build a more realistic picture of what the next few months may look like.
The earlier you identify potential changes to your income, the more time you have to prepare and make any necessary adjustments.
Your next steps
September is a good time to make sure you are prepared for the final few months of the year. Keeping your bookkeeping up to date, monitoring your cash flow, reviewing your financial performance and planning for the future can help you maintain a clear view of your financial position and make informed decisions.
At SJC Finance Team, we take care of the day to day, keeping your records up to date throughout the year. Providing you with reliable financial information when you need it and helping to ensure everything is prepared on time.
If your bookkeeping has fallen behind over the summer, or you would like greater visibility over your finances, SJC can help.
Book your free finance health check today.
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