Year-end adjustments and what the owner must supply

The year-end adjustments your accountant will make, from closing stock to depreciation, and the information the owner must hand over for each.

By Achekam · 11 October 2026 · 4 min read · For Running a business businesses in South Africa, Nigeria, Kenya

Every year-end, the same conversation repeats. The accountant asks for a stock figure, a list of unpaid bills, the details of the new vehicle and a view on which customers will never pay. The owner, who thought the books were up to date, wonders why so much is still needed. The answer is that a year's bookkeeping records transactions, and a set of financial statements also needs judgements and counts that no invoice or bank line contains.

Those are the year-end adjustments. Your accountant makes the entries, but most of them depend on information only you have. Supplying it early and complete saves a long back-and-forth and gets the statements finished sooner.

Closing stock

ACCA explains that cost of sales is opening inventory plus purchases minus closing inventory, so closing inventory is a credit to cost of sales in profit or loss and a current asset on the balance sheet. A higher closing stock figure means higher profit, which is why it needs to be right.

What the owner supplies:

• a count of stock on hand at the year-end date, by item and quantity, signed by whoever counted;
• the cost price of each item, from supplier invoices;
• a list of damaged, obsolete or slow-moving stock that may be worth less than cost;
• stock held at other locations, or by others on your behalf.

If you use Achekam's stock locations, note that stock counts, wastage, transfers and opening quantities do not post to the general ledger; only till sales and till returns move the inventory account. The count itself is what your accountant needs to set the ledger right.

Accruals and prepayments

ACCA explains that unpaid expenses relating to the period are shown as current liabilities (accruals) and expenses paid in advance are shown as current assets (prepayments), with the profit or loss charge adjusted accordingly.

What the owner supplies:

• bills received after year-end for goods or services used before it: the electricity for the last month, the accountant's own fee, a repair done in the final week;
• work done for you before year-end that has not been billed at all;
• payments made before year-end that cover the following year: annual insurance, licences, software subscriptions, rent in advance, each with the period it covers.

Income received in advance, and income earned but not billed

ACCA explains that income received in advance (deferred income) is a liability and income in arrears (accrued income) is an asset.

What the owner supplies:

• deposits and advance payments from customers for work not yet done or goods not yet delivered at year-end;
• work completed before year-end that was invoiced only afterwards, with its value;
• any long contracts in progress at year-end, with how far each has got.

Our article on cash basis versus accrual basis explains why both directions matter.

Doubtful debts

ACCA explains that an allowance for receivables shows trade receivables at a realistic value without writing the debt off, so the balance stays on the customer's account and collection continues.

What the owner supplies:

• the aged debtors at year-end; Achekam ages receivables into 0-30, 31-60, 61-90, 91-120 and over 120 days, with overdue totals;
• for each large or old balance, what you know: in dispute, in liquidation, paying slowly, promised payment;
• debts you have given up on, which may need writing off rather than an allowance.

Depreciation from the asset register

ACCA explains that the straight-line method charges the same amount each year, while the diminishing-balance method charges a percentage of the carrying amount, so the charge is higher early in an asset's life.

In Achekam, a fixed-asset register lets a business add assets at cost, depreciate them monthly by straight line or reducing balance with a journal each month, and dispose of them with the profit or loss posted. Tax wear-and-tear is not worked out, and the register is not part of Business Essentials.

What the owner supplies:

• invoices for assets bought during the year, with the date each was brought into use;
• details of assets sold, scrapped or traded in, with the proceeds;
• confirmation that every asset on the register still exists.

Getting the books ready in Achekam

Before the accountant starts, make sure the bookkeeping itself is finished. In Achekam:

1. Reconcile every bank account to the year-end statement. Bank lines are matched by suggestion and a person accepts each match; a line not yet in the books becomes a suggested journal a person approves; and a reconciliation completes only when nothing is left unexplained.
2. Appoint your accountant if you have not. A business appoints its accounting firm by the firm's Achekam address or firm code, with an access level, and the firm accepts or declines. An appointed firm works directly in the business's own ledger, with no copy made, so the adjustments it posts appear in your own screens.
3. Close the year's months once the adjustments are in. Months can be soft-closed, hard-closed and locked; a closed month refuses postings from every source, and reopening a hard close needs a second approver.
4. Know what the profit line means. Achekam posts no year-end closing entry: profit is not closed to retained earnings and shows as its own line on the balance sheet. Your accountant deals with that in the financial statements; do not try to fix it with a journal of your own.

The checklist in one place

• Stock count, at cost, with obsolete items flagged
• Bills received after year-end for costs before it
• Payments made in advance, with the periods covered
• Customer deposits and unbilled work at year-end
• Aged debtors with notes on doubtful balances
• Asset purchases and disposals, with invoices
• Every bank account reconciled

For a first year-end, see your first financial year-end.

Read further

ACCA's article on adjustments to financial statements explains how each of these adjustments is processed after the trial balance. Send your accountant the checklist above, completed, within the first few weeks after year-end, and ask which items they still need.

General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.