How should it be done

The “closing down the year” process will include providing in one folder (digital or physical) copies of the following:

  • your cashbook or accounting records, 
  • bank statements for the full year, 
  • all invoices and expenses that have been paid out and have appeared on a bank statement, 
  • a list of any payments that aren’t finalised
    • Invoices received where they haven’t been paid or the cheque for payment hasn’t cleared the bank
    • Payments or donations received that haven’t been put into the bank,
    • Invoices for payments requested/expected that haven’t been received.

There are accountancy names for this last bunch of records – creditors/debtors and some accounts will mention accruals but don’t worry about that. In the Next Steps Financial Management module we’ll go through ways to minimise this category, so you don’t have to deal with it as much.

In that first line, “copies” is underlined, because you should always send copies (or a link to a digital folder) rather than the originals, in case there is a problem. You have a legal responsibility to ensure that your records are kept safe for six years after the end of the fiscal year the records apply to. 

We go into record keeping in more detail in the Next Steps Financial Management module, but for now bundle the full years’ worth of records up into a folder or envelope and label it clearly “year-end accounts xxxx – can be destroyed after xx/xx/xxxx”.