Every garage owner dreads year end. It is the moment you discover that six months of transactions were never recorded, receipts are in a shoebox, and the accountant wants everything by Friday.

Here is how to close the year without panic.

Two weeks before year end

Start early. The last two weeks of the year are for confirming, not starting.

Reconcile every bank account to the last statement
Reconcile M-Pesa to the last statement
Confirm supplier balances with a statement request
Confirm customer balances with a statement send
Count physical stock and compare to system

The week of year end

The final week is for closing out.

Ensure all December invoices are issued
Ensure all December expenses are recorded
Accrue any expenses you incurred but have not yet received invoices for
Accrue income you earned but have not yet invoiced

Accruals matter. Without them, the year’s profit is understated or overstated depending on which side is missing.

Closing entries

Your accountant or bookkeeper will make closing entries:

Depreciate fixed assets for the year
Adjust inventory to physical count
Write off bad debts you will not collect
Recognise deferred income that has now been earned
Post any final adjustments

Do not skip these. They are what turn raw transactions into financial statements.

Financial statements to produce

At year end, produce:

Profit and loss statement for the year
Balance sheet as at year end
Cash flow statement
Supporting schedules for receivables, payables, and fixed assets

These are the documents your auditor needs, KRA needs, and your bank needs if you are applying for credit.

KRA filings

Depending on your structure and obligations:

Annual income tax return (individuals by 30 June; companies within 6 months of financial year end)
VAT returns for December (due 20 January)
PAYE for December (due 9 January)

Do not miss these dates. Penalties compound fast.

Records retention

Keep for a minimum of 5 years:

Invoices issued and received
Bank and M-Pesa statements
Payroll records
VAT returns filed
Asset purchase records

Keep them digitally where possible. Paper degrades. Digital does not.

Setting up for a clean new year

Before you close the year, set up next year’s books:

Carry forward opening balances
Set up the new year’s accounting period
Update employee salary rates if applicable
Reset leave balances
Update price lists

Done properly, this takes an hour. Done badly, it takes three months of cleanup.

How Gariclaim helps

Gariclaim generates year-end financial statements automatically from your recorded transactions. Depreciation, accruals, and adjustments are supported as journal entries. Reports export to PDF or Excel for your accountant.

Your KRA PIN, tax registration types, and filing history are all stored against your organisation profile.

Start a free trial and end this year without the panic.

Year-End Accounting Checklist for Kenyan Garages