Getting caught up on bookkeeping can feel like an uphill battle, especially when you’re already juggling the day-to-day operations. Get your free Financial Health Score https://www.bookstime.com/articles/payroll-automation today, and join hundreds of entrepreneurs who are on track to healthier books. The information provided on this website does not constitute insurance advice.
Small Business Administration, 30% of small businesses fail within the first two years, often due to poor accounts management. This underscores the critical need for regular bookkeeping to maintain clean books and accurate financial records. As you make your way through your bookkeeping cleanup checklist, you want to ensure that you are up-to-date with paying your taxes. Whether you filed an extension or it’s time to start paying regularly quarterly taxes, your newly organized bookkeeping will help you pay on time and consistently.
How Much Do Catch Up Bookkeeping Services Cost?
They need to have a solid understanding of both bookkeeping and accounting principles so they know what to look for. Make sure to have bills for all vendors you’ve worked with and are still working with. If you’re missing some vendor receipts make sure you contact them because it can make a huge difference for your overall tax deductions. It’s easy to put your bookkeeping clean up bookkeeping on the back burner until next month, but eventually, next month turns into next year and tax season is knocking on the door. And of course tax season conflicts with your late first-quarter objectives leaving you little to no time to get the books up to date. For efficiency’s sake, remove any unused or necessary accounts from your chart of accounts.
When you pay off a loan or sell an asset, it should be removed from your financial statements correctly. That means recording them as paid off or sold — not as expenses or revenue, respectively. Paid off loans or sold off assets can be tricky to record depending on your situation, so check with your bookkeeper, accountant or CPA to learn how to do it correctly. Recording revenues, expenses, liabilities, and receivables set you up to better track when payments are due and when money comes into your bank accounts. As a result, you can more intelligently manage your cash flow and never get caught in a position where you’re short on cash and fall behind. If you’re a business owner, falling behind on your books is almost guaranteed.