Year-End Budget Rush? Ask "Why Now?" Before You Approve in Slack

Every company with an annual budget gets the same Slack message in November and December: "We have budget left — can we buy this before year-end?" Sometimes the answer should be yes. Often the request exists only because the money is about to disappear.

That pattern isn't a hunch. In a study of US federal procurement, economists Jeffrey Liebman and Neale Mahoney found spending in the last week of the fiscal year was 4.9 times the rest-of-year weekly average, and year-end IT projects had substantially lower quality ratings. A GAO review decades earlier described the same rush producing cursory price analysis, unjustified purchases, and premature awards. A growing company isn't a federal agency, but "use it or lose it" budgets create the same incentive anywhere.

You don't need to ban year-end buying. You need year-end requests to carry a little more information, so the approver can tell a real need from a budget flush, and so finance books it correctly in QuickBooks or Xero.

Why "before December 31" is usually the wrong reason

Two different things get mixed together in a year-end request:

1. Budget timing. The team wants to spend this year's allocation before it resets.
2. Tax or accounting timing. Someone heard that buying equipment before year-end helps on taxes.

The first is a budgeting policy question, not a reason to buy. The second is real but narrower than people think. For equipment and other depreciable property, the IRS ties Section 179 expensing and depreciation to the year the property is placed in service, not the year you paid for it. Publication 946 says property is placed in service when it is ready and available for a specific use. Its own example: a machine delivered last year but not installed and operational until this year counts as placed in service this year.

So a server ordered on December 20 that arrives January 8 doesn't land in this year just because the card was charged in December. If the "before year-end" argument is about tax, the request needs a realistic delivery and setup date, not just a purchase date.

(For context, current federal rules are generous: the IRS lists the 2026 Section 179 limit at $2,560,000, phasing down once qualifying property placed in service tops $4,090,000, and the One Big Beautiful Bill permanently restored 100% bonus depreciation for qualified property acquired after January 19, 2025. Your accountant decides how those apply to you. The approval flow just needs to capture the facts they'll ask for.)

Add a year-end lane to your Slack request

From roughly mid-November through your fiscal year-end, require four extra fields on any request that mentions year-end timing or uses remaining budget:

• Why now? A one-line reason the purchase can't wait for next year's budget. "Budget expires" alone doesn't count; "current laptops fail the new security baseline" does.
• Need date vs. delivery date. When the team actually needs it, and when the vendor says it will arrive and be usable. If delivery is after year-end, say so.
• What kind of spend. Equipment you'll keep (possible fixed asset), a service period that runs into next year (possible prepaid), or a normal expense. This is the same flag described in Asset or Expense? and Paid a Year Upfront?.
• Was this in the plan? Yes, it was budgeted and delayed; or no, it's new and using leftover money.

None of these slow down a legitimate request. They take thirty seconds for a requester who knows why they're buying, and they're hard to answer for a purchase that only exists because December arrived.

Give approvers a simple rule

A rule from an old White House memo on federal year-end buying still works well: fourth-quarter orders shouldn't exceed the third quarter's except where a higher level is fully justified, and supply orders should stay at the minimum needed. For a Slack-first team, that becomes:

• Planned and delayed: approve normally.
• Unplanned but justified on its own merits: approve, and note that it would have been approved in February too.
• Unplanned and justified only by expiring budget: decline, or push it into next year's planning.
• Stockpiling (six months of supplies, extra licenses "while we have budget"): approve only what covers the real near-term need.

Routing matters too. Year-end requests that use leftover budget should go to the budget owner, not just the requester's manager, and they still count against the remaining budget including open commitments. Watch for one large purchase broken into several "small" year-end requests; the split-purchase check matters most when people are racing a deadline.

There's evidence that simply signaling scrutiny works. In a field experiment in Chile, public agencies that got a letter warning of audit attention two weeks before fiscal year-end cut year-end procurement spending by 33% compared with agencies that didn't, with the biggest drops in office supplies and paper products. A pinned Slack message in mid-November explaining the year-end lane does the same job at a much smaller scale.

Book it the way it was approved

The point of capturing the extra fields is that finance shouldn't have to rediscover them in January:

• Received in December, invoiced in January: this is an accrual at close. Open approvals with a delivery date before year-end are your accrual list (Close From Open Approvals).
• Paid in December, delivered in January: it's a prepayment or deposit, not this year's expense or this year's fixed asset. Record the in-service date when it actually arrives and works.
• Equipment that may be expensed under Section 179 or bonus depreciation: keep the delivery and setup confirmation with the approval record, since placed-in-service date is the fact that matters.
• Service contracts starting next year: prepaid, recognized over the service period.

In QuickBooks or Xero, the bill or expense should carry the same account and class/tracking the approver saw, and the approval record should link to the delivery confirmation. That way the year-end story is in one place.

The short version

Year-end isn't a reason to buy. It's a reason to ask two more questions: why now, and when will it actually arrive and be usable? Put those questions into the Slack request for the last six weeks of your fiscal year, route leftover-budget requests to the budget owner, and book each purchase by what actually happened, not by when the card was swiped.

This post is about approval process, not tax advice. Talk to your accountant about how Section 179, bonus depreciation, and accrual timing apply to your business.