Before we discuss the signs that you need catch-up bookkeeping, let’s first define it. Catch-up bookkeeping involves reviewing, organizing, and updating past financial records to clearly understand your business’s financial health. This process includes filling in missing information, categorizing transactions into the correct accounts, reconciling bank and credit card statements, and ensuring compliance with state and federal regulations.
Do You Need Catch-Up Bookkeeping?
Ask yourself the following questions:
- Are you behind on your bookkeeping—by a week, a month, or even longer?
- Do you struggle to determine whether a project or your entire business is profitable or losing money?
- Are you having trouble managing expenses, experiencing cash flow issues, or struggling
- to meet payroll?
- Have you bounced checks or incurred fines and penalties from the IRS or state tax authorities for missed deadlines?
- Has your accountant been unable to file taxes on time because your books are inaccurate, causing you to miss out on valuable tax-saving deductions?
If you answered “yes” to any of these questions, it’s time to consider catch-up bookkeeping.
Why Bookkeeping Often Falls Behind
Running a business is demanding. You didn’t start your business to be a bookkeeper, and it’s easy to let this essential task slide. But don’t worry—this problem is solvable with the help of a trained bookkeeper.
How Catch-Up Bookkeeping Works
- Gather Financial Records
Collect all your financial documents, including invoices and bank and credit card statements. - Organize and Record Transactions
Ensure all transactions are accurately recorded and categorized in your accounting system. - Reconcile Accounts
Reconcile accounts receivable, accounts payable, and bank and credit card statements to ensure accuracy. - Update Your Accounting System
Make sure your accounting software reflects your current financial situation.
The Benefits of Catch-Up Bookkeeping
Once your financial records are accurate and up to date, you’ll enjoy several advantages:
- A clear picture of your business’s profitability.
- The ability to make informed business decisions.
- Stress-free tax preparation with tax-ready financials for your CPA.
- Savings on taxes, penalties, and interest.
- Accurate forecasting for upcoming expenses.
- Improved client relationships through accurate financial statements.
On the Road to a Profitable 2025
Investing in catch-up bookkeeping will reduce stress, free up time for clients, friends, and family, and set your business up for success.
Ready to get started? Schedule your free 30-minute consultation today: https://calendly.com/matchbooks/30min
Written by Joel Nimar, a senior consultant at MatchBooks and a serial entrepreneur founding businesses IT services, construction and financial services.