The financial statements are an official and formal report related to a company’s fiscal year, ending at a specific date, presenting the financial position of the company. It includes the income statement, balance sheet, cash flow statement, and accompanying notes. Typically, the fiscal year in Finland follows the calendar year. The financial statements provide a detailed summary of the company’s financial performance. Analyzing key figures from different sections, such as the income statement and balance sheet, is crucial. It’s important to understand what these figures reveal about the company’s profitability, solvency, liquidity, and financial position.
When Should the Financial Statements Be Ready?
The financial statements must be ready for submission to the tax authorities within four months after the end of the fiscal year. Additionally, for limited liability companies, the financial statements must be filed with the trade register no later than eight months after the end of the fiscal year. In practice, the financial statements or their components are usually registered when submitting the tax return.
Financial statements must be prepared for each fiscal year of the company, depicting its financial results and asset status.
Preparation and planning, along with scheduling, are considered by Finaly’s experts as the most important factors in avoiding unpleasant connotations associated with the financial statement process (such as burdensome bureaucracy lingering in the background) and the “rush” often wrongly associated with financial statements. The CFO or an outsourced CFO consultant from Finaly ensures and ensures a smooth and accurate process for your company.
How Does an Outsourced CFO Assist in Financial Statements? Does an Outsourced CFO Prepare the Financial Statements?
An outsourced CFO can support the financial statement process by providing expertise and guidance. They can help ensure that all financial transactions are correctly recorded and that the financial statements are prepared in accordance with applicable rules and standards. Depending on the agreement and role within the company, an outsourced CFO may also be a key figure in preparing the financial statements.
Tips Based on Our Experience and Expertise:
1. Start planning well in advance of the fiscal year-end. Review schedules, define important dates, and ensure that all necessary documents are up to date and readily available. Book the audit in advance and keep the auditor informed throughout the fiscal year.
2. Ensure that all transactions are correctly recorded and that the accounting is up to date throughout the fiscal year. Check that all income and expenses are recorded in the correct accounts. Are you already receiving monthly financial reporting at the financial statement level from your accounting firm/bookkeeper?
3. Review the company’s assets and liabilities. Ensure that all receivables and obligations are accurately assessed and reflect the company’s true financial position. For this purpose, confirmations must be ordered (in advance) from all banks and other credit institutions, etc. (Finnvera, Business Finland, etc.)
4. Go through the accounts receivable to consider whether the company has receivables it will not collect. Also, go through other unpaid receivables (sales invoices) and record payment plans for them. This doesn’t need to be left until the last minute but is better to handle well in advance of the fiscal year-end.
5. Review the fixed asset register (and whether there should be one unless there is) regarding new acquisitions. Also, go through the inventory list and conduct a physical inventory count if your company has inventory.
6. Ensure the timeliness of employee vacations and the vacation pay provision, as well as the submission of other employee information to payroll accounting, which can easily be forgotten amidst many details.
7. Review the timeliness of invoicing and remember to issue all sales invoices for the current fiscal year. Also, consider other items to be apportioned and go through them to ensure that income and expenses are allocated to the correct fiscal year.
8. Delivering the financial statements and communicating with the relevant parties once completed is part of good financial management culture: remember to communicate the essentials internally within the company and to your stakeholders, such as investors, the board, and other important parties.
Summary – Planning, Systematic Approach, and Accuracy
Preparing financial statements requires careful planning, systematic approach, and accuracy. As you can see, there are many details to remember and take care of in the financial statement process. If things don’t feel familiar and you want to free up your time, trust expert and skilled assistance.
If you need help preparing financial statements or other financial matters for your small or medium-sized business, we at Finaly are more than happy to assist you. You can reach out to us or book a meeting directly with Anne from here.
