Tips for IT Financial Management year closing

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December 17th, 2021 | For a successful financial year-end closure it’s good to consider some IT specific items. Value Tech Everyday offers top tips and considerations that will help you to be compliant to your accounting framework.
 

Closing the financial books of your IT department

Optimize your EBITDA

The board and shareholders will be delighted if you bring them an opportunity to improve your companies EBITDA. Check your cloud invoices. Most of them will have to be booked as Opex, but check if the contract contain Capex elements. If so, you'll have to book them as Capex.

This creates a Win-Win: You'll be compliant to IFRS and improve your EBITDA in one go.

If you need support, just contact us
 

Check Software Portals

Check the software portals you have with your suppliers. You might find used licenses that aren’t reflected in the accruals yet. You might also be surprised by the number of portals available in your organization that can trigger financial impact. It’s good to list and manage them periodically.
 

Free Licenses

Anticipate to licenses that are currently free of charge but at some point are priced by the vendor. A Google Vault license was such an example we experienced last year.
 

SaaS Licenses

Many companies have a relaxed attitude towards SaaS licenses, because you're never under-licensed. Still, that doesn't make the opposite also true: We encounter companies that have more SaaS licenses than they really use and also companies with too expensive licenses (higher license tier than required)
 

Accruals

Check if you have more deployments of software than you have contracted. Record them as accruals.
 

FX Risk

Check any FX risks on IT contracts that are denominated in a currency other than the domestic currency of your company.
 

Happy holidays!

This is the first post with some of our most valued tips for year-end closing. We will post another one next week!

A consideration worth mentioning here is the fact that year-end checks will be less cumbersome if you perform them regularly throughout the year for example by using our Connect Business Value and Optimise Investments services.

In this way you will be more precise and have less surprise at the end of the year, saving you some precious time in the process. And let’s be honest, who would argue with that during the festive season?
 
 
Have a question or in need of a hand with year-end closing?
 
Contact us!