2024 Business Health Checklist: Navigating Tax and Financial Wellness


Regularly checking on the financial health of your business can help you take financial administration to the next level. These checks allow you to identify potential problem areas, make necessary improvements, and prepare for unexpected emergencies. Financial health checks also allow you to prepare for tax season. 

Below, we provide a list of important factors to consider for your company’s 2024 financial health. 

1. A Financial Health Assessment

The first step in our business health checklist is to review your company’s financial statements. This includes your balance sheet, profit and loss statement, and cash flow statement. Together, these statements can give you an in-depth look at your financial performance, to help with strategy and planning.

Balance sheet analysis

The main goal here is to examine your assets and liabilities. Ideally, your company should have enough assets to cover its current liabilities. 

Factors that influence your asset sheet include:

  • Your working capital (short-term liquidity). Your business needs to be able to sell a service or product fast enough to finance its operations.  
  • Asset performance. This is how well you use and manage resources to create profitable returns.
  • Capitalization structure. This refers to the ratio of your company’s debt versus equity.

A healthy balance sheet depends on efficient asset management. Thus, it’s vital to be aware of your debts, and to check your ability to meet short-term financial obligations.

Profit and loss statements

Profit and loss statement summarizes your company’s revenues, costs, and expenses over a specified period. 

These statements differ slightly depending on whether your business uses cash or accrual accounting methods. The former is a simpler method that only tracks cash going into or out of your accounts. The latter records any revenue that is earned, including expected future payments and liabilities. 

When analyzing profit and loss statements, it’s a good idea to compare statements from different periods, to note any trends or potential issues. 

By tracking your sales, cost of goods sold (COGS), earnings before tax, and profit margins, you can evaluate your company’s ability to grow revenue and have better control of expenses. 

Evaluating your cash flow statement

You can assess your company’s cash flow health in a few simple steps:

  • Check your overall net cash flow for the year. A positive cash flow indicates that you’ve generated more profits. Negative cash flows imply that your business used more income than it has generated. 
  • Analyze revenue from operating activities. This can help you spot trends and changes in your income.
  • Consider income from investments. This includes your company’s properties, equipment, and sale of assets.  
  • Account for cash flows from finance activities. This includes debt payments, issuing stock, or paying dividends.
  • Calculate your free cash flow. To do so, subtract capital expenditures from operating activities.
  • Compare your cash flow to other financial statements. By comparing these statements, you’ll have a holistic view of your business’s financial performance.
  • Mark any problem areas. Check your statements for indicators of financial trouble, including a consistent negative free cash flow.

2. Budget Review and Adjustments

Reviewing your budget is vital for any business health checklist. Note that it’s essential to compare your budget to your actuals. By comparing your planned budget to the actual amounts paid or earned, you can analyze any variances and determine why there were differences. 

Such a comparison can improve your budget accuracy, and allow you to implement any changes for course correction. 

Usually, there are two main ways your budget can differ from your actuals: 

  • Income variances are most common when your projected revenue differs from your realized sales. 
  • Spending variances are directly related to your company costs, and can occur when budgeted expenses do not correlate with actual expenses.

To ensure budget accuracy, you’ll need to keep current trends in mind and be flexible, to plan for various scenarios. By reviewing external economic and market trends, you might spot trends that negatively impact your finances. 

3. Tax Planning and Compliance 

With careful tax planning, your business can avoid making common errors that might affect compliance, including:

  • Filling in forms incorrectly 
  • Filing late or missing deadlines
  • Not separating your business and personal expenses
  • Underpaying estimated taxes
  • Depositing employment taxes which should be withheld 

Ensure that your team is aware of all tax filing deadline dates. A CPA can assist you with this, and advise you on best practices. 


Remember that there are occasional changes to regulations. Thankfully, the IRS has resources to guide you in this. 

Tax credits and deductions

Depending on your industry, your business might be eligible for a number of tax credits and deductions. These include charitable donation deductions, a 401(k) contribution deduction, or self-employment expense deductions. 

Your tax planning strategy should therefore include research of applicable industry-specific deductions, as well as any new tax credits. A tax professional can assist you with deductions and credits, to improve your business’ financial health. 

4. Review Operational Efficiency

Any business health checklist should include internal audits. These will help you to review operational processes for efficiency gains, and streamline your financial management. 

Audits are a way to assess your company’s internal controls to identify problems before they impact your bottom line. Internal audits require you to track and document operational changes for effective risk management, and establish governance processes. 

The process involves the following:

  • Planning. Clearly define the objectives of the audit plan.
  • Consultation with experts. Internal governance must be correctly designed to reflect industry best practices.
  • Following an established framework. Bodies like the International Professional Practices Framework (IPPF) provide mandatory and recommended guidance on audit procedures.
  • A request list. This documents and guides the audit process. It includes information such as interviews, evidence requests, and supporting documentation. 
  • Preparation of an audit program. The program should include the summary and purpose, risks, controls, testing procedures, observation and inquiry types, and how outcomes are validated. 

5. Supply Chain and Vendor Analysis

The next item on your business health checklist is to review your supply chain and vendors. Supply chain and vendor analysis can help optimize business processes by removing redundancies, and ensuring that your vendors are cost-effective. 

Below is a brief outline of how to conduct this analysis:

  • Define your objectives and scope. Ask yourself what goals you want to achieve. Is it to save money or time on deliverables, meet regulatory compliance, or ensure quality?
  • Gather data from all stages of your supply chain. Include inventory levels, transport cost, lead times, and supplier performance. 
  • Define your key performance indicators (KPIs). Also, collect data on these metrics to ensure they’re being met. 
  • Perform a SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) to identify factors that may impact your supply chain.
  • Conduct a supplier and vendor assessment. Be sure to evaluate performance based on your established goals. 
  • Do a risk assessment, and include risk-mitigation strategies. 
  • Analyze costs to establish where expenses could be lowered without compromising quality. 
  • Establish an action plan for optimizing your supply chain.
  • Continuously monitor the plan, and make adjustments where necessary.

6. Risk Management

A vital part of any business health checklist is to minimize risks. This includes an annual insurance review. 


If any aspect of your business has changed – such as new hires, upgraded or downsized premises, or new equipment, this must be communicated with your insurer. After all, such changes may affect the value of your assets and liabilities, which affects your insurance coverage. 

Be sure to also review the terms and conditions of existing policies. In this regard, the following factors are important to consider:

  • Coverage. Your business and all assets must be adequately covered by the policy.
  • Exclusions. Clarify any exclusions in the policy, and what effect this could have on operations. 
  • Premiums. Premiums should be affordable – this might entail comparing your policy to others available on the market. 
  • Notice of claims. If your business needs to make a claim, you should know exactly what is expected of you, as well as all the applicable time frames. 

Regulatory compliance 

New industry-related compliance measures are introduced regularly. As such, your accounting software should allow you to be compliant with financial regulations. Moreover, consider establishing compliance strategies that account for any changes. 


Here’s how to do that:

  • Check which regulations apply to your business. Basically, regulations will depend on your industry, location, offered products and services, and the clients you work with. You can use government resources for this. Alternatively, a CPA can advise you on industry-specific regulations. 
  • Research the requirements specific to these regulations. This includes what you need to document, and which bodies to liaise with. 
  • Conduct an initial internal audit to evaluate your current compliance status.
  • Document all compliance policies and procedures. These should be reviewed periodically to ensure they are valid, and that your company is fulfilling all obligations.
  • Provide your staff with the necessary training to ensure they’re aware of all policies and procedures. 

7. Strategic Planning

Effective planning is key to sound financial management. In addition to planning your budget, consider market trends and conduct a competitor analysis. 

Understanding your competition can help you to assess your business’ position and performance relative to others in the industry. 

An essential element of planning is a SWOT analysis of competitors. Knowing what helps or hinders your competitors can help your business avoid the same mistakes, and maximize potential opportunities. This can go a long way towards increasing your market share. 

It’s also advisable to develop long-term business goals. These are milestones for your company’s vision that usually span a period of three to five years. Unlike short-term goals, they are not affected by external changes, and they outline high-level objectives. 

8. Employee Wellbeing and Productivity

The final item on our business health checklist is to ensure that your staff are productive. Through training and development, you can help your employees to grow, while keeping them engaged with and invested in your business. 

Training can improve employee job satisfaction, and lead to increased innovation and employee retention. To assess whether your staff needs additional training, consider the following:

  • Performance gaps. Are there specific areas in which your staff could do better – whether it’s adapting to new technology or improving customer service?
  • Employee satisfaction. Are your staff content and productive? Consider sending out a survey about which training and development programs would help them be more confident in their roles. 

Employee Benefits

Employee benefits can vastly improve satisfaction and productivity. As such, we recommend reviewing your benefits package regularly. 

Offering benefits can help your business remain competitive, draw top talent, improve its image, and even affect your tax strategy through deductions. 

When you review benefits, start by checking what you already offer. Common employee benefits include: 

  • Health insurance
  • Paid medical leave 
  • Parental leave 
  • Disability insurance and workers’ compensation
  • Overtime pay

With feedback from your employees, you can determine which of these are most in demand, and whether you need to change your packages. 

Keep in mind that your employee benefits should align with your company’s purpose. 

By ticking off the items in this checklist, you’ll be one step closer to ensuring excellent business health in 2024. However, if you need any assistance, schedule a Discovery Call with one of our CPAs.

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The information presented in this blog article is provided for informational purposes only. The information does not constitute legal, accounting, tax advice, or other professional services. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability of the information contained herein. Use the information at your own risk. We disclaim all liability for any actions taken or not taken based on the contents of this blog. The use or interpretation of this information is solely at your discretion. For full guidance, consult with qualified professionals in the relevant fields.