Year-End Accounting Checklist for Canadian Corporations
Use this checklist to ensure your year-end accounting is complete, accurate, and ready for T2 filing.
Year-end accounting is the annual process of closing your books, preparing financial statements, and getting ready for your T2 corporate tax return. For most corporations, this happens within 60 to 90 days of the fiscal year-end. Starting early and working through a systematic checklist makes the process far less stressful — and reduces the risk of errors that could cost you money.
Bookkeeping and Reconciliation
Complete these steps before anything else:
- Reconcile all bank accounts and credit cards to the last day of the fiscal year
- Review and categorize all uncategorized transactions
- Reconcile accounts receivable — confirm all outstanding invoices are recorded
- Reconcile accounts payable — confirm all outstanding bills are recorded
- Reconcile HST/GST account to your filed returns
- Reconcile payroll liabilities to CRA remittance records
- Review petty cash and ensure it's reconciled
Asset and Liability Review
Ensure your balance sheet accurately reflects your financial position:
- Update the fixed asset schedule — add new purchases, record disposals
- Calculate depreciation (CCA) for all asset classes
- Review loans and financing — confirm balances match lender statements
- Review shareholder loan account — ensure it's properly documented
- Confirm prepaid expenses are correctly recorded
- Review accrued liabilities — ensure all year-end expenses are accrued
Revenue and Expense Review
Review your income statement for accuracy:
- Confirm all revenue is recorded in the correct fiscal year
- Review large or unusual expense items — ensure they're properly documented
- Confirm meals and entertainment is recorded at 100% (your accountant will apply the 50% limit)
- Review home office expenses if applicable
- Confirm vehicle expenses are supported by a mileage log
- Review any intercompany transactions for proper documentation
Tax Planning Items
Before closing the books, discuss these with your accountant:
- Year-end bonus accrual — must be paid within 180 days of year-end
- Capital cost allowance (CCA) optimization — sometimes it's better not to claim maximum CCA
- Scientific Research and Experimental Development (SR&ED) credits if applicable
- Small business deduction eligibility review
- Dividend vs. salary optimization for the coming year
Documents to Provide Your Accountant
Gather these before your year-end meeting:
- Bank and credit card statements for the full fiscal year
- Loan statements showing year-end balances
- Prior year T2 return and financial statements
- Details of any new equipment or asset purchases
- Details of any asset disposals
- Shareholder loan documentation
- Any legal agreements entered into during the year
A well-prepared year-end package saves your accountant time — and saves you money in accounting fees. The more organized your records, the faster and more accurately your T2 can be prepared. Start gathering documents at least 30 days before your scheduled year-end meeting.
Ready to Start Your Year-End?
Our team handles year-end accounting and T2 filing for corporations across Ontario. Book a consultation to get your year-end on the calendar.
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