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Conduct a Painless, Powerful End-of-Year Business Budget Review

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year-end budget review

A year-end budget review helps you focus on what’s important in your business.

No matter how much you dread looking at the numbers come December, business and accounting professionals all agree: Conducting an end-of-year mini business budget review is a healthy business habit to get into. Here’s our take on keeping the process as straightforward–and painless–as possible.

With the economic landscape in perpetual flux–and as various markets face new financial challenges–the year-end mini budget review marks a time to step back and examine your cash flow. This process illuminates the direction your business is heading–and provides managerial insight for planning the coming year.

The Three Primary Components of a Year-End Budget Review

The first step in the process is to take an honest look at your bottom line. It’s easy to get caught up in varying factors–such as seasonal sales or unusual growths or declines–so doing the math is the only sure way to evaluate the state of your business.

Gather these three documents to conduct your review:

  • Income Statement. Provides operating expenses, revenues, margins, and profits or losses–all indicators of whether you’re operating profitably or not
  • Cash Flow Statement. Includes the operating (running), investing (growing), and financing (funding) activities that define your business
  • Balance Sheet. Critical in that it helps provide an apples-to-apples comparison of your previous budget with your business’ current financial state

Once you’ve examined these documents and generated acceptable conclusions, it’s time to put things into perspective.

Business Budget Review Results below Par? Investigate the Possible Causes

If your budget review paints a darker picture than you expected, there could be a variety of factors influencing your cash flow. Taking a look at year-long trends will help you to discover the primary causes of economic uncertainty–as well as how to adjust for them.

Here are three potential variables that deserve your attention:

  • Tax Implications. Make sure to clearly mark funds for income and other taxes to avoid overestimating available cash
  • Major Purchases. Replacing failing equipment–or any similar spending emergency–can force you to allocate amounts for those purchases before the funds are actually collected
  • Spending Variances. Keeping departments from over- or underspending is a difficult task–and one that often goes unchecked

But you might not come out on the short end of the mini budget review–and knowing how to manage a budget windfall is just as important.

The Budget Review Returns Good News–Now, How Will You Manage It?

Showing up ‘in the black’ is a good feeling. However, the way your business manages that budget overage will have implications beyond the New Year. In that spirit, there are a few key areas of operations that can always use a little extra money.

Here are three quality suggestions for investing your business budget overage:

  • Stock Up on Essentials. Focus on the necessities to remain lean and agile, including buying in bulk to save some serious money–consider stocking up on logo pens, custom stationary, or promotional computer accessories
  • Prepare for Seasonal/Special Events. Thank-you gifts for employees and customers or trade show giveaways are always quality investments–also, giving bonuses to employees and dividends to investors improves the perceived value of your company
  • Create a New Year Marketing Campaign. Consider launching a publicity event with logo apparel or custom tote bags to increase your brand impression
  • Donate to Lesson Your Tax Burden. If your year-end profits allow, making donations to charities is a smart (and socially conscious) way to reduce the taxes you owe.

The review and reassessment process is an annual, ongoing process–one that you will improve upon with each passing year and even greater business success.

Check out all of our unique employee thank-you gifts–perfect for spending that budget overage! No matter how much–or how little–you’re looking to spend, we have a collection of quality, name-brand corporate gift ideas that will put a smile on your employees every time.


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