Many small businesses fall months behind on bookkeeping, then face a scramble before their CPA's deadline. Catch-up bookkeeping brings the books up to date so returns can be filed accurately and on time.
Signs you need it
- Bank accounts not reconciled for months.
- Hundreds of uncategorized transactions in QuickBooks or Xero.
- Your CPA asking for a trial balance you cannot produce.
- Missed estimated tax payments because you did not know your profit.
The catch-up process
- Gather records: bank and card statements, loan statements, payroll reports, sales platform reports and receipts for large purchases.
- Set up the chart of accounts so income and expenses match the lines on your tax return.
- Categorize transactions month by month, starting with the oldest open period.
- Reconcile every account to statements, including cards and loans.
- Record non-cash items: payroll journals, depreciation, owner contributions and draws.
- Review and close each month, then produce a profit and loss statement and balance sheet for your CPA.
How long it takes
It depends on volume and how many accounts you have. A year of a small service business is often a few weeks; high-volume e-commerce takes longer. Working with an offshore team can run catch-up overnight while you work.
Stay current afterwards
Move to a monthly close: bank feeds, rules for recurring transactions, monthly reconciliations and a short management report. It costs less than repeated catch-ups and means you always know your numbers.
How we help
We do catch-up bookkeeping in your QuickBooks Online or Xero file, reviewed by chartered accountants, then keep you current every month. See our bookkeeping services for US businesses or our month-end close checklist.
