With the start of spring comes the anticipation of sunshine, warm weather, and the annual spring cleaning — a time to say out with the old, and in with the new. While you’re taking the time to refresh your home and organize your closets, why not organize your finances as well to make filing your tax returns a breeze?

With tax season just around the corner, now is the perfect time to get your finances in order, reflect on your goals, and plan for the year ahead. Here are three tips to help small business owners spring clean their finances, prepare for tax season, and set new goals for a successful year.

1. Account Reconciliation

Regularly reconciling your business accounts is a valuable practice that will not only ensure accurate record-keeping, but will also help identify problems before they get out of hand. Inconsistencies like fraudulent activity, mischarged transactions, or unused subscriptions can be easily identified and addressed. This practice also allows you to pinpoint and improve inefficiencies while gaining a holistic understanding of your business’ overall performance.

While many businesses will opt for monthly reconciliation to stay on track, the best advice is to make reconciling your accounts a daily habit. Just as you’d stay on top of household maintenance following a good spring cleaning, maintaining daily account reconciliation easily on your mobile device is a healthy practice to either start or end each day so that you can keep your finances organized beyond the spring season.

2. Collect Outstanding Payments

Payment collection can feel like a tedious game of cat and mouse that leaves both parties feeling weary of the next interaction. Rather than allowing clients to sweep their invoices under the rug and forget about them, technologies can be adopted to keep payment collection organized and on track. Accounting platforms, like Xero, offer features like online invoices, which streamline payments from client to business owner, and simplify the process for bookkeepers and accountants.

Just as a cleaning service may work better than roommates, automating invoice reminders will alleviate stress by working for you — providing clients with
friendly reminders and enforcing a timely collection policy. This is also an opportunity to easily settle your own outstanding bills through Xero’s batch payments, organize your financial records to identify cash flow, and stay on track of your business’ financial health.

3. Re-evaluate Your Goals

Spring is the season of renewal, making it the ideal time to reflect on whether you met your financial and professional goals of the previous year, and re-evaluate what you hope to achieve in the year ahead. This is an opportunity for a financial check-up to organize your hits and misses, and a reminder to set new goals for your business. As a business owner, your spring cleaning checklist should include three basic financial documents: an income statement, a cash flow statement, and a balance sheet. These documents will be essential in establishing financial projections, revising your budget, and setting ambitious but attainable goals for the future.

This is also an ideal time to determine whether you’ve been optimizing available resources and professional relationships and to consider whether there is room to adopt additional technologies, services, or advisors who may be beneficial to your business’ overall financial performance.

The spring season motivates and energizes us to organize our homes and make healthy lifestyle choices — it only makes sense that you take this opportunity to spring clean your finances as well. Using tax season as a launch pad, kickstarting your financial refresh may be the spark you need to establish achievable financial goals for next year and drive your business to the next level of success.

Will Buckley is the Canada Country Manager for Xero.