The festive season isn’t just about sales and marketing—it’s also a critical time for financial management. For many businesses, Christmas can make or break the year, so having your accounting and bookkeeping in order is essential. Here’s what you should be doing now:

 

1. Review Your Cash Flow

Christmas often means higher expenses—stock purchases, seasonal staff, marketing campaigns. Forecast your cash flow for the next 2–3 months:

• Identify periods of high outflow.
• Ensure you have enough liquidity to cover wages, rent, and supplier payments.
• Consider short-term financing options if needed.

 

2. Budget for Seasonal Expenses

Create a detailed budget for:

• Inventory: Extra stock for peak demand.
• Marketing: Holiday campaigns and promotions.
• Staffing: Overtime or temporary hires. Stick to your budget to avoid overspending during the festive rush.

 

3. Track Outstanding Invoices

Late payments can cripple your holiday plans. Chase overdue invoices now and tighten credit terms for new customers. Consider offering early payment discounts to improve cash flow.

 

4. Prepare for Tax Obligations

The end of the year often coincides with tax deadlines. Make sure:

• Your BAS (Business Activity Statement) is up to date.
• You’ve set aside funds for GST and PAYG.\
• You’re aware of any deductible expenses related to Christmas (e.g., staff parties, gifts—within ATO guidelines).

 

5. Manage Payroll Efficiently

With extra staff and overtime, payroll can get complicated:

• Confirm award rates for casual and holiday workers.
• Ensure superannuation contributions are calculated correctly.
• Automate payroll where possible to avoid errors.

 

6. Keep Accurate Records

Christmas transactions can spike dramatically. Use your accounting software to:

• Track daily sales and expenses.
• Reconcile bank accounts regularly.
• Monitor profit margins on seasonal products.

 

7. Plan for Returns and Refunds

Post-Christmas returns can impact revenue. Factor this into your cash flow and ensure your accounting system can handle adjustments smoothly.

 

8. Review Financial Performance

Compare this year’s holiday season to previous years:

• Which products or services are most profitable?
• Are your margins healthy despite discounts? Use these insights to plan for next year.

 

9. Consider Year-End Tax Strategies

Christmas is close to the end of the financial year for some businesses. Speak to your accountant about:

• Prepaying expenses.
• Writing off bad debts.
• Maximising deductions before year-end.

 

10. Communicate with Your Accountant

Don’t wait until January to sort out your books. Regular check-ins with your accountant can help you avoid surprises and keep your business financially healthy.

 

Bottom Line: A strong festive season isn’t just about selling more—it’s about managing your finances smartly. Good bookkeeping now means fewer headaches later.