Now that we are halfway through the year, it’s an excellent time to take a step back and reflect on the first six months. Conducting a thorough mid-year check-in can help you evaluate your achievements, pinpoint areas that need improvement, and make the necessary adjustments to meet your business goals effectively.
Here are steps you can take as part of your mid-year check-in:
1. Make sure your bookkeeping is up to date
As a business owner, it’s easy to let bookkeeping slip through the cracks. If you have fallen behind, now is the perfect time to catch up. Staying on top of your bookkeeping is crucial as it helps you understand the financial position of your business and identify errors or suspicious activities early on, saving you time and money in the long run. Here are some bookkeeping tasks you may need to address:
Scan and organize receipts and documentation for business expenses
Reconcile bank, credit card, and loan accounts
Review outstanding bills and invoices
If you don't have a consistent bookkeeping schedule, consider establishing one to avoid being overwhelmed by a backlog of transactions after months of neglect. Depending on the volume of transactions your business handles, it may be beneficial to set aside dedicated time each week or month to ensure everything is kept up to date.
2. Review your financial statements
Financial statements offer a clear picture of how your business is performing. By reviewing these documents, you can identify areas where you can cut costs, optimize operations, and make informed investment choices. The three primary financial statements to focus on are:
Profit and Loss (P&L) Statement: Details revenues and expenses for a given period
Balance Sheet: Summarizes your company’s assets, liabilities, and shareholders' equity
Cash Flow Statement: Tracks the flow of cash in and out of your business
Accurate and up-to-date bookkeeping is essential when generating these reports, giving you a true representation of your business's financial health.
3. Plan for taxes
Avoid having surprises during tax season by reviewing your tax payments for the year. Check-in with your accountant or bookkeeper to ensure you're up-to-date with your federal, state, and city tax payments and paying the appropriate amount. If your income for this year is different than expected, you may want to review and adjust the amount of your estimated tax payments.
4. Review your business goals
The halfway mark is a great time to evaluate your progress toward the business goals you set at the beginning of the year. Consider the following:
How has your business grown from quarter to quarter or year to year?
Are the goals you set still relevant, or do they need to be revised?
Have new goals emerged that are now a priority?
Reflecting on these questions will help you move forward with intention and clarity, ensuring your efforts align with your desired outcomes.
5. Identify areas of improvement
With the insights gained from your mid-year review, identify specific areas where improvements can be made. Consider the following:
Are there tasks that can be outsourced or is there a need to hire additional help?
Are there processes that can be automated to save time and increase efficiency?
Can you save money by canceling unnecessary subscriptions or services?
Create a plan to address your insights, setting clear objectives for what you want to achieve in the next six months. Moving forward with a clear and focused strategy will enhance your ability to achieve your business goals and sustain long-term growth.
Need help? Consult a professional
Taking the time to conduct a mid-year review is an investment in the success of your business. By reflecting on your progress and making strategic adjustments, you can set the stage for a successful second half of the year.
Your accountant or bookkeeper can be a great asset during your mid-year check-in. As a client of Summit Bookkeeping, we strive to be more than just your bookkeeper, but a resource for you and your business. Our goal is to help you reach your goals. If you need a bookkeeper, give us a call at (360) 756-5020 to see how we can help.
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