The end of the year is a busy time in the wine business. Between wrapping up harvest, preparing for the holidays, and managing sales, it’s easy to put your finances on the back burner. But this is one of the most important times to pause, review your numbers, and make sure your books reflect what really happened over the past twelve months.
A clean year-end close helps you see how your winery performed, plan for next year, and avoid any tax-season surprises. Here’s a financial checklist for wineries that breaks it down step by step to make it more manageable. Let’s go through what to focus on before the new year begins.
1. Clean Up Your Books
Let’s start with the basics and make sure your bookkeeping is accurate and up to date. That means reconciling every bank account, credit card, and loan statement so the balances in your accounting software match what’s on your statements. Small differences can snowball into big confusion later if you don’t catch them early.
Next, review your expenses and make sure they’re categorized correctly. Vineyard labor, grape purchases, barrel costs, packaging, marketing, and tasting room expenses should all sit in the right buckets. When your accounts are organized, you can see where money actually went, and your CPA can prepare accurate reports and tax returns without guesswork.
If you use software like QuickBooks or Xero, take advantage of their built-in reconciliation tools to automate things, but still give it a once-over to ensure everything matches. Once that’s done, you’ll have a solid foundation to build your year-end reports and next year’s budget.
2. Count And Value Your Inventory
Inventory is one of the trickiest parts of winery accounting. A lot of your money isn’t in your bank account; it’s sitting in barrels, tanks, and bottles. That’s why it’s so important to count it carefully and make sure the value on your books matches reality.
You can start by doing a physical count. Go through every part of your operation: finished wine that’s ready for sale, wine still aging in barrels or tanks, and any packaging materials like glass, corks, or labels. Compare your physical count to what’s in your production records. If something doesn’t match, it’s better to investigate now rather than later.
Once your count is accurate, assign a value to what you have. This shows how much your inventory is worth and it directly affects your cost of goods sold (COGS).
Wineries can use several valuation methods, such as:
- FIFO (First In, First Out): assumes the oldest inventory sells first.
- Weighted Average: smooths out price fluctuations across lots.
- Specific Identification: tracks the actual cost of each wine lot or vintage.
Many wineries use specific identification because each varietal and vintage has its own timeline and cost structure.
Finally, check for any losses. Wine can evaporate, spill, or spoil. It’s just part of production. It’s better to record these changes right away to give you a truer picture of your costs and help you avoid overstating your assets when tax season arrives.
3. Check Payroll And Taxes
Payroll deserves a close look before the year ends. Make sure every employee’s information is current (names, addresses, and Social Security numbers), and that tax withholdings are correct. That includes federal and state income tax, Social Security and Medicare (FICA), unemployment insurance, and any state disability or local payroll taxes that apply in your area.
If you hire seasonal vineyard workers or tasting room staff, double-check that their employment records are complete and that all pay periods have been processed. Then, get a head start on preparing W-2s and 1099s. Many wineries work with contractors, from vineyard crews to marketing consultants, and forgetting a form can cause delays or fines later.
This is also a good time to review your overall tax position. If your winery had a profitable year, you may still have time to make deductible purchases or prepay certain expenses. If you bought new equipment, vehicles, or barrels, confirm that everything is recorded correctly on your depreciation schedule.
Finally, don’t overlook compliance filings. Wineries must file reports with the Alcohol and Tobacco Tax and Trade Bureau (TTB) and often with state agencies for excise and production taxes. Staying current on these ensures your licenses remain in good standing and avoids last-minute stress.
4. Review Your Cash Flow
It’s common for wineries to look profitable on paper yet still feel cash-poor. That’s because your money moves differently from your profit does. You might spend heavily on grapes and barrels months before you make a sale.
Take time to map out your cash inflows and outflows. When do you typically have the biggest expenses: harvest, bottling, or packaging? When does revenue usually arrive: wine club shipments, tasting room sales, or distributor payments? Seeing those patterns in advance helps you plan when to save, when to spend, and when to draw on a line of credit.
If you’re using financing, review how often you rely on it. A short-term credit line can be a helpful bridge, but it shouldn’t be a constant crutch. If you find yourself using it often, that might signal it’s time to revisit pricing, production volume, or overhead costs.
5. Plan For Next Year
Once your books are clean and your cash picture is clear, it’s time to look ahead. Start by reflecting on the past year: what went well, and what could improve? Maybe tasting room traffic exceeded expectations, but wholesale sales lagged. Or maybe your grape costs increased more than planned? Understanding what happened helps you build a more realistic plan for next year.
Create a forecast that includes your expected production, sales, and expenses by channel. If you’re planning to invest in new equipment or expand your facility, include those costs early so you can plan your cash needs.
You should also take a look at your pricing. Costs of grapes, glass, corks, and labor have gone up for many wineries. If your prices haven’t changed in a while, it’s probably time to review whether your margins are still healthy.
Winery Accountants That Help You All Year Round
Year-end doesn’t have to be stressful if you stay on top of your numbers throughout the year. Doing small check-ins, like monthly reconciliations or quarterly inventory counts, makes the final close much easier. It also helps you spot problems early, before they become major issues.
If all of this still feels overwhelming, you don’t have to do it alone. At Llamas Financial, we help wineries across the U.S. with bookkeeping, payroll, tax, and CFO-level guidance tailored specifically to the wine industry.
The end of the year is your chance to see how far you’ve come, prepare for what’s next, and enter the new vintage with confidence. With the right systems and the right accounting partner, you’ll spend less time worrying about your numbers and more time focusing on what you do best – making great wine.
