EOFY Tips for Pharmacy
End of financial year is fast approaching and there are several steps you can take to ensure your pharmacy POS is ready for 30 June. These steps ensure optimal accuracy of the reports your bookkeeper and accountant will need to finalise your tax year.
1. Internal Store Accounts
Review your customer accounts for any internal accounts, i.e. Store Use, Donations, Expired Stock and Owner accounts (that won't be paid). Action the write off of these within your POS prior to 30 June. Ensure you print off a copy of this statement and provide it your bookkeeper so they can enter it in your accounting system to offset your sales
2. Bad Debts
Review your customer accounts for any irrecoverable bad debts and action the write off of these within your POS prior to 30 June. Ensure you print off a copy of this statement and provide it your bookkeeper so they can enter the bad debt in your accounting system to offset your sales.
3. Outstanding Amounts
Review the ageing balance of your customer accounts and chase any in the 60+Day column to pay their account pre 30 June. If you have a high number of old outstanding accounts you should also review your process for chasing these accounts. At a minimum you should have a team member responsible for reviewing these monthly and chasing up the customers. The key in managing outstanding accounts is to be consistent so the clients know it is a priority to pay you.
4. Application Process
If you have a high number of bad debts or old account balances you need to review your application process in store. Let the team know the minimum requirements for verifying if a client can have a store account and implement a formal application process so you have recourse for debt collection.
Stock on Hand
1. Negative Stock
Run your negative stock report in your POS system and review/fix all items so this is nil by 30 June to improve the accuracy of your stock on hand figure. We recommend that this also become a regular part of your stock control process and not just part of the EOFY process.
2. Damaged Stock
Check your shelves for damaged stock prior to 30 June and charge to your internal customer account. Ensure you write this account off per our advice above.
3. Stock without Departments
Run your stock report and check the 'No Department' items. Check the entire setup of these items is correct as this is often an indicator that it was setup by a staff member who isn't your stock controller. Allocate the items to a department and re run the report until this is nil.
4. Stock Count
You should be completing rolling stock counts throughout the year with the aim to count your stock on hand three times over by the EOFY. If you have not done this consider either getting in a professional stock counting company or completing an internal store wide stock count prior to 30 June. If you have completed rolling stock counts consider counting the departments with the lowest item numbers but highest value items pre 30 June. Any changes in this department will have a large impact on your gross profit.
If you have completed a tax planning session with your accountants in the lead up to EOFY ensure you act on their advice prior to 30 June.
Part of this tax planning may have been to pay additional s uper contributions to your own fund. Note that you cannot action this payment on 30 June as many funds have an earlier cut-off for EOFY. This will need to be actioned by the 20 June to ensure it hits the funds in time to be claimable.
2. Consider Paying Super Early
If you need an additional tax deduction consider paying your April-June quarterly employee super prior to 30 June. You will not be penalised if you pay it by the July deadline but paying it pre EOFY will entitle you to claim it as a tax deduction in this financial year.
Note as with your own super you cannot action this payment on 30 June as many funds have an earlier cut-off for EOFY. This will need to be actioned by the 20 June to ensure it hits the funds in time to be claimable.
3. Asset Purchases
The government has extended the availability for instant asset write-offs. If you are considering purchasing new assets for your business then think about moving this purchase to pre 30 June. Review the cap for the financial year with your accountant/bookkeeper and ensure you will be eligible to claim it on the item/s you are considering purchasing.
If you need advice or help on any of the above items do not hesitate to contact us!