4 tips to manage your company’s finances this end of the year

We are in the final stretch of the year, and with the last months come the festivities, gifts to collaborators, dinners with clientsemployee recognition and other closing events that represent corporate expenses, therefore it is important to efficiently manage business finances

The last months of the year usually compromise, to a greater extent, the cash flow of a company due to the numerous payments, surcharges and events, these expenses end up involving large amounts of money, with which the financial area begins a race against time to maintain normal operations.

“Unfortunately, not everyone manages to optimize their finances during this period, and it is more difficult to settle accounts to start the new year with accumulated expenses or a negative balance”, highlights Klaus Pollmann, Director of Sales in Mexico at Rindegastos.

not only the payment of legal benefits and taxes they tend to add a burden to the year-end finances, gifts to collaborators and dinners with clients and other closing events, they also represent an important part of corporate expenses, but they have positive effects on the company’s commitment to its teams, partners and allies.

Given this scenario, it is essential to timely manage these expenses so that they are contemplated in advance, which is why Pollmann recommends four actions to maintain financial productivity without sacrificing the festive spirit of the end of the year:

1. Establish budgets in advance: doing this helps you prevent losses, especially when you don’t have enough funds. Remember to set spending limits and define specific amounts for each activity.

1. Generate overcrowding alerts: There are various platforms that allow generate alerts when financial movements exceed the maximum expected expenses and even stop transactions that exceed the amount of the budget set.

1. Automate expenses and reports: resorting to technology is always good to match information and avoid accounting errors. For example, having billing information broken down by purchases, expenses and taxes automatically avoids wasting time reviewing manually and helps you know how much money you really have for the holidays, all from the same platform.

1. Hierarchize and prioritize: One of the most sensible exercises, especially when going through reduced solvency, is to decide which dependencies and businesses are most important and necessary —such as workers, clients and suppliers—, with the purpose of avoiding the waste of resources, but taking care of corporate relations.

It is also important take accounting support of all company expenses, so that they are deductible when presenting them in the annual tax return, such as ISR.

“The advantages of recording in detail the financial movements for meetings, courtesies or parties during the holidays are many and can provide support when making the payment of tax obligations,” explains Pollmann.

Another option is to draw a roadmap to find out how perform annual returnswith the aim of better preparing for the festivities and knowing the fluctuations in the expenses of each period of the year.

This effort will not only have an effect on taking care of the company’s internal finances, it will also promote advantageous practices for those in charge of approving budgets, scheduling meetings, or reviewing the proper use of corporate financial resources.