End of Financial Year Bookkeeping: What Your Records Need to Show Right Now
The financial year has closed. For most Australian small businesses, this is the point where the quality of the bookkeeping done throughout the year becomes very visible, very quickly.
If the books have been kept accurately and consistently, EOFY is a straightforward wrap-up. If they have not, this is the moment where gaps, miscoded transactions, and unreconciled accounts surface - usually right when the accountant needs clean figures for the tax return.
This article sets out exactly what your bookkeeping needs to show at end of financial year, the most common issues that surface at this time, and a practical checklist to work through before your accountant starts your return.
The Business Problem
Many small business owners treat EOFY as a single event - a rush of activity in July to pull everything together before the tax return is due. But EOFY is not really an event. It is a checkpoint. It reveals whether the bookkeeping practices used throughout the year were sufficient, or whether there is now a backlog of corrections needed before the numbers can be trusted.
The businesses that find EOFY stressful are almost always the ones whose bookkeeping fell behind at some point during the year. The businesses that find it straightforward are the ones whose records were reconciled consistently, month by month, all year.
Why It Matters
"EOFY does not create bookkeeping problems. It reveals the ones that were already there."
Getting EOFY right matters for more than just a smooth tax return. Accurate year-end figures are what your accountant uses to identify deductions, plan tax strategy, and advise on the year ahead. Inaccurate or incomplete figures mean missed deductions, delayed lodgement, and advice based on an incomplete picture.
For businesses carrying tax debt, accurate EOFY figures are especially important - they are often the basis for negotiating payment arrangements or demonstrating genuine financial position to the ATO.
The Bookkeeping On Time Perspective
Every year, we see the same pattern repeat. Businesses whose bookkeeping has been maintained consistently throughout the year reach EOFY with almost nothing left to do - a final reconciliation, a few reports, and the file is ready for the accountant.
Businesses whose bookkeeping has fallen behind at some point face a very different EOFY. Months of unreconciled transactions need to be worked through. Miscoded GST needs correcting. Payroll figures need to be checked against BAS lodgements for the whole year. What should be a straightforward wrap-up becomes a significant catch-up project, often under time pressure.
The lesson we consistently share with clients is that EOFY quality is decided throughout the year, not in the final weeks of June. But if you are reading this now and your books need attention, the good news is that a clear, systematic approach can get you back on track before your accountant needs the figures.
The BOT End of Financial Year Readiness Checklist
Work through these steps in order. Each one should be confirmed as complete before moving to the next.
1. Bank reconciliation for every month of the financial year
Every bank account, credit card, and payment platform used by the business needs to be reconciled for every month from July through June. Gaps or unreconciled periods need to be identified and resolved first - everything downstream depends on this being accurate.
2. GST coding review
Review transactions for the year and confirm GST has been applied correctly and consistently. Common issues include GST claimed on GST-free purchases, GST not applied to taxable sales, and inconsistent coding of similar transaction types across different months. While reviewing transactions, this is also the right time to check whether your business needs to lodge a Taxable Payments Annual Report (TPAR). This applies to businesses that make payments to contractors in certain industries, including building and construction, cleaning, courier and road freight, information technology, and security, investigation or surveillance services. If your business falls into one of these categories, TPAR is due by 28 August each year and reports the total payments made to each contractor during the financial year. Not every business needs to lodge one, so it is worth confirming with your accountant whether it applies to you.
3. PAYG withholding reconciled to BAS
For businesses with employees, confirm that PAYG withholding recorded in payroll matches what has been reported and paid across all four BAS lodgements for the year. Discrepancies here are one of the most common sources of year-end confusion.
4. Superannuation guarantee reconciliation
Confirm superannuation has been calculated correctly for every employee across the full year, including any casual staff who may have been added part way through, and that all quarterly super payments have actually been made and received by the relevant funds.
5. Accounts receivable and payable review
Review outstanding invoices owed to the business and outstanding bills owed by the business. Confirm these are accurate and reflect the genuine position at year end - including identifying any invoices that are unlikely to ever be collected, which your accountant may need to address as bad debts.
6. Asset and depreciation records
Confirm any assets purchased during the year are recorded correctly, with the right classification for depreciation purposes. Your accountant will need accurate records of purchase dates, amounts, and asset types to apply the correct tax treatment.
7. Stock and inventory count
For businesses carrying stock, an accurate year-end stock count is required to determine the correct cost of goods sold figure. This needs to be a genuine physical count, not an estimate carried over from the previous year.
8. STP finalisation submitted
Confirm the Single Touch Payroll finalisation has been submitted for every employee. Without this, employees cannot access their income statements to complete their own tax returns, and the employer's payroll records are considered incomplete for the year.
9. Reports prepared for your accountant
Once the above steps are complete, prepare a full profit and loss statement and balance sheet for the financial year, along with any supporting schedules your accountant typically requests - such as a fixed asset register or a reconciliation of loan balances.
Common Mistakes at EOFY
Treating EOFY as a once-a-year catch-up rather than a monthly discipline. Businesses that reconcile monthly throughout the year rarely face a significant EOFY workload. Businesses that let reconciliation slide are the ones who face weeks of catch-up work every July.
Submitting figures to the accountant before reconciliation is complete. Sending unreconciled or partially reviewed figures to an accountant under time pressure often results in errors being carried into the tax return, which then require costly amendments later.
Forgetting to submit STP finalisation. This step is easy to overlook once BAS and payroll for the year feels complete, but it is a separate, required action that many small businesses miss.
Not reconciling super payments against what funds actually received. It is not enough to confirm super was calculated and a payment was made. The payment needs to be confirmed as received by each employee's actual super fund, particularly where a clearing house is used and processing delays can occur.
Estimating stock rather than counting it. An estimated stock figure that differs materially from the true count can distort the cost of goods sold and understate or overstate profit for the year.
The Decision Tool: Are You EOFY Ready?
Answer yes or no to each of the following. If you cannot confidently answer yes to all of them, your books are not yet ready for your accountant.
Has every bank account been reconciled for all twelve months of the financial year?
Has GST coding been reviewed for consistency and accuracy across the full year?
If your business pays contractors in an industry covered by TPAR, has this been checked and, if required, prepared for lodgement? Do your PAYG withholding figures match exactly across payroll records and all four BAS lodgements?
Has superannuation been reconciled for every employee, including any casual staff added during the year?
Have accounts receivable and payable been reviewed for accuracy, including any invoices unlikely to be collected?
Have all assets purchased during the year been recorded with correct classification?
Has a genuine physical stock count been completed, where applicable?
Has the STP finalisation been submitted for every employee?
Is a complete profit and loss statement and balance sheet ready to hand to your accountant?
Why Bookkeeping ON Time
We are a registered BAS agent based in the Hills District, supporting Australian small businesses across Sydney and remotely nationwide, working in Xero and MYOB.
EOFY readiness is one of the areas where the quality of ongoing bookkeeping matters most - and it is exactly what we focus on throughout the year with every client, not just in the final weeks of June. Our clients reach EOFY with reconciled accounts, accurate GST and PAYG figures, and reports ready to hand directly to their accountant.
If your books have fallen behind and EOFY has arrived faster than you expected, we also specialise in catch-up bookkeeping - working through the backlog systematically so your accountant receives accurate figures, even if the path to get there took longer than it should have.
Frequently Asked Questions About PAYG Withholding
Do I need to lodge a Taxable Payments Annual Report (TPAR)
Only if your business makes payments to contractors in specific industries, including building and construction, cleaning, courier and road freight, information technology, and security, investigation or surveillance services. If this applies to you, TPAR is due by 28 August each year. Your accountant can confirm whether your business is required to lodge one.
What happens if my books are not ready by the time my accountant needs them?
Speak with your accountant about realistic timing. Lodging your tax return with inaccurate figures to meet a deadline usually creates more work later through amendments. It is generally better to get the figures right, even if that means a short delay, than to submit incomplete or incorrect records under pressure.
Do I need a physical stock count every year?
If your business carries inventory, yes. A genuine year-end stock count, rather than an estimate, is required to accurately calculate cost of goods sold and determine true profit for the year. Your accountant can advise on the specific requirements for your business type.
What is an STP finalisation and why does it matter?
The Single Touch Payroll finalisation is a declaration submitted for each employee after the financial year ends, confirming their total earnings and withholding for the year. Without it, employees cannot access their income statement to lodge their own tax return, and your payroll records for the year are considered incomplete.
How far back can I catch up bookkeeping if I have fallen behind?
Bookkeeping can be caught up from any point, provided bank statements and supporting records are available. Most Australian banks provide statements going back several years. The key is working through each period systematically rather than trying to reconstruct the whole year at once.
Can EOFY bookkeeping issues affect an existing ATO payment plan or tax debt?
Accurate EOFY figures often form the basis for renegotiating a payment plan or demonstrating genuine financial hardship to the ATO. Inaccurate or incomplete records make these conversations considerably harder. Speak with your accountant if you have existing tax debt and are unsure how your EOFY figures affect your position.
Next Steps
If working through the checklist above has revealed gaps in your records, the sooner these are addressed, the smoother your tax return process will be.
At Bookkeeping On Time, we help Australian small business owners get their EOFY bookkeeping accurate, complete, and ready for their accountant - whether your books have been maintained consistently all year or need a catch-up project to get there.
Book a free 15-minute call with Sarah. We will look at where your bookkeeping stands right now and tell you exactly what needs attention before your tax return is due.
Bookkeeping On Time is a bookkeeper and Registered BAS Agent based in the Hills District, supporting Australian small businesses with accurate bookkeeping, BAS preparation, payroll, and EOFY readiness. We work alongside your accountant to make sure your records are always accurate and ready. This article is general information only and does not constitute financial, tax, or legal advice. Please speak with your accountant for advice specific to your situation.
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