As we move into the New Financial Year 2020-21 here are a few important things every businesses must do.

1. New Billing Series: If your business has GST registration you must start a new billing series for your Sales Invoice, Debit Note & Credit Note. As per Section 31 of the CGST Act, 2017 a business has to follow consecutive serial number, in one or multiple series unique for a financial year.

2. New Financial Year in Accounting Software: If your business runs on Tally ERP 9 you can change the accounting period by pressing Alt+F2 and pervious year balances will be carried forward to the new year. If you use any other accounting package, follow the process as per your accounting software or contact the customer care to change the accounting period.

3. Balance Confirmation of Debtors & Creditors: It is very important that the outstanding balance as per your books of accounts reconcile with your supplier’s or customer’s books of accounts. Hence, obtain a copy of the ledger account or balance confirmation statement from your major debtors and creditors.

4. Closing Stock as on 31.03.2020: Having the correct balance of closing stock is very important for any business which have inventory. If possible conduct a physical stock verification or count of closing stock as soon as possible and work out the closing inventory as on 31.03.2020

5. Reconciliation with GST Returns for 2019-20: Verify your GST Returns during the year 2019-20 with your books of accounts and identify if any errors or omissions have occurred. If there are any differences immediately make necessary adjustments in the next GST for the month of March 2020 or next return as soon as possible.

6.  Tax Deduction at Source (TDS)Ensure that TDS has been deducted from payments that fall within the purview of TDS. For eg; Salaries to employees, Rent, Professional Charges, Commission Payments, Contract Payments, etc

7. Bank Reconciliation & Confirmation: Reconcile your bank balances with bank statements/bank passbooks as on 31.03.2020 and carry forward correct balance to next year.

8. Reconciliation with Form 26AS: Form 26AS provides the details of payment received by you from which tax has been deducted (TDS). Reconcile these incomes with your books of accounts so that there will be no mismatch when filing the income tax returns.

Follow these best practices for efficient management of your business.

Author Bio

Qualification: CA in Practice
Company: Ayyar & Cherian
Location: Kochi, Kerala, IN
Member Since: 02 Apr 2020 | Total Posts: 2

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June 2021