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8 Signs Your Business Needs Catch Up Bookkeeping | An Entrepreneur’s Guide To Bookkeeping, Tax, & How They Interact

Have you ever tried to pick out an outfit from a cluttered closet? What about hunting for a new book club title in a disorganized library? Just when the frustration sets in,  your brain tells you: “Let’s just wing it.”

Those same thoughts creep in when your business has a tangled web of financial records. You sift through confusing numbers, lose sight of important metrics, and decide to just wing it because you know your business best, right?

Well, this strategy isn’t going to do you any favors in the long-run. Messy books can lead to: 

  • Tax penalties
  • Missed opportunities for profit and savings (like tax deductions/credits)
  • Poor cash flow management
  • Bad financial decision-making

Whether you’re preparing for your annual tax return or filing quarterly taxes, accurate and organized bookkeeping is critical. So, let’s get down to business and get that accounting in order with catch up bookkeeping.

In this article, we’ll offer insight into the world of “catch up” – including what catch up bookkeeping entails, how to identify when your books need help, and practical tips on how to clean up your books.

Ready for stress-free business tax filings and smooth financial management? Keep on reading!

What Is Catch Up Bookkeeping? A Quick Review

What exactly is catch up bookkeeping, you ask? Great question.

Used interchangeably with “bookkeeping clean up,” it’s the process of reviewing, organizing, and updating your financial records to ensure that you have an accurate picture of your business’s financial health. The more you know, the better choices you’ll make for the future of your business. 

Plus, an organized system makes it easier to stay on top of upcoming payments and deadlines, and helps prevent costly mistakes. 

Catching up on your books involves all of the bookkeeping basics, like: 

  • Categorizing transactions
  • Reconciling accounts
  • Creating accurate financial statements

This process allows you to get an accurate snapshot of where your business stands financially, while helping you spot areas for improvement, identify opportunities for growth, and save money on taxes.

Can Quick Fixes Do the Trick?

Quick fixes, like relying on spreadsheets or delaying record keeping, may seem like a good idea in the short term. But they can lead to missing or inaccurate financial information, which will hurt your business potential now and when it comes time to sell.

Poor bookkeeping can also result in tax errors and penalties, missing out on tax deductions and credits, and an increased risk of an audit.

If you’re experiencing…

  • Difficulties managing expenses
  • Struggles with cash flow
  • Feeling in the dark about your business’s financial health
  • Getting fined penalties by the IRS
  • Losing important financial records
  • Missing out on tax deductions and credits
  • Having payroll problems
  • Being bogged down by catch up bookkeeping during tax season

…those are clear signs that your business needs a bookkeeping clean up.

Catch up bookkeeping helps you stay on top of expenses, manage cash flow, and make informed business decisions to help you grow. So, let’s catch up the right way!

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How Do I Catch Up On Bookkeeping?

Feeling overwhelmed by your bookkeeping duties? You’re not alone!

Let dive into a few strategies for how to clean your books:

Analyze Credit Card and Bank Statements

Regularly analyzing statements helps keep your finances accurate and your business healthy. We recommend checking your credit card and bank statements monthly to: 

  • Stay organized
  • Catch big expenses
  • Pay accurately
  • Identify unexpected charges or transfers

For example, you might discover a long-forgotten subscription that’s still charging you every month.

Further, catching unauthorized withdrawals early can be critical since they could indicate potential fraud.  Plus, you never know when you might catch a duplicate payment.

This habit will help you eliminate unnecessary expenses and spot errors, saving you time and money.

Reconcile Bank Accounts

Check your bank statements against your accounting records to catch any mistakes, ensuring that all transactions have been recorded properly.

This will help you spot discrepancies and take action, like filing disputes and implementing clear policies for payment authorization and cash reserve access.

Review Your Chart of Accounts

For efficiency’s sake, remove any unused or necessary accounts from your chart of accounts. This will ensure that it’s organized and accurately shows your business’s current needs.

Assess Accounts Payable and Receivable

Consistently assessing your accounts payable (AP) and accounts receivable (AR) is key to keeping your business running smoothly. It helps you spot discrepancies, errors, cost-saving opportunities, and areas where you can grow your income.

Here are a few ways to assess your AP and AR:

  • Start by reviewing statements and ensuring transactions are recorded correctly.
  • Double-check that invoices are up-to-date, and contact vendors if any are missing or incorrect.
  • Check on outstanding invoices and bills to make sure they’re paid or resolved, and remove old balances from your books.
  • Look for discounts or payment terms that could save you money. (For example, some vendors may offer a discount if an invoice is paid within a certain amount of time!)

Organize Your Receipts and Invoices 

Organize all of your receipts and invoices so that they’re easily accessible. We recommend using a cloud-based accounting software to safely store your financial documents.

Establish an expense tracking system to accurately categorize all of your business expenses. Putting a process in place for reviewing and authorizing expenses can prevent tax filing errors and potential fraudulent activity.

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Get Started To:

– Save $500 per month

– Recoup 20+ hours every month

– Increase your business’s survival odds by 313%

3 Resources To Help You Get Caught Up On Bookkeeping

1. Leverage Our Free Financial Health Score Tool

Do any of these things apply to your business?

  • Doing day-to-day bookkeeping tasks yourself
  • Accounting processes aren’t streamlined
  • CPA has gone dark, or just takes weeks to respond
  • Not getting or looking at financial data on a consistent basis

If your answer is yes, it’s time to leverage our Financial Health Score – a powerful and free tool that catches 80% of your bookkeeping errors within just a few minutes.

You’ll come away with an actionable score (from 0% to 100% correct) and a detailed report of what’s working and what needs fixing to get your books clean.

Plus, with better data, you’ll be equipped to make better business decisions – and that’s a fact!

Get your free Financial Health Score today, and join hundreds of entrepreneurs ​​​​who are on track to healthier books.

2. Put Our Bookkeeping Clean Up Checklist To Use

Once you’ve gotten your Financial Health Score, it’s time to start addressing those errors. And what better way to do it than with a handy bookkeeping checklist?

Our Bookkeeping Clean Up Checklist is a step-by-step guide to turning your messy books into clean accounting records. This comprehensive checklist covers everything from getting set up on an accounting software to mapping out your business budget.

Now here’s our gift to you – use this to get on track, monitor your progress, and celebrate your accomplishments. And it’s free, which is a win-win for you!

Here’s a sneak peak into what it covers:

Embrace the cloud.

Things can get messy pretty quick, with clunky spreadsheets and paper receipts piling up on your desk. So, we say switch to a cloud-based accounting software, like QuickBooks Online, Xero, or FreshBooks.

Leveraging one of these tools will sync with your bank feeds and automatically pull in your bank transactions, categorize expenses, and give you easy access to financial reporting, like income statements, balance sheets, cash flow statements, and more.

The cloud is your new BFF in the bookkeeping world!

Keep business and personal separate.

Mixing business expenses and personal expenses is a big no-no. Set up separate business credit cards and bank accounts to avoid financial chaos and:

  • Safeguard your identity (and protect your assets)
  • Get some legal protection (separating yourself from your business’s legal liability)
  • Establish your business’s credibility (with customers and the IRS)
  • Have a less stressful tax season (because business taxes are already complicated enough!)

Just remember, a little separation can save you a whole lot of headaches down the road!

Master the art of expense categorization.

Expense categorization is a big part of a healthy accounting process. Organizing your expenses into clear categories will make your life easier when building a business budget and come tax time.

One way to approach categorization is:

  • Create a list of each transaction, and then
  • Organize them into categories based on the type of expense.

For example, you could create separate categories for office supplies, travel, meals, and advertising. This will help you see where your money is going and identify any areas where you may be overspending.

And make sure to categorize expenses as soon as they happen! You will thank yourself later.

3. Outsource Catch Up Bookkeeping Services To Acuity

Let’s face it. Getting caught up on bookkeeping can feel like an uphill battle, especially when you’re already juggling the day-to-day operations.

So, why not shift that burden and make room for more exciting things? Let our accounting pros handle your catch up bookkeeping so you can focus on growing your business.

Our team of skilled bookkeepers and accountants is ready to tackle any client’s bookkeeping clean up with expertise and efficiency. We’ll dive into the nitty-gritty of your financial records, pinpoint any discrepancies, and bring your books up to speed.

But that’s not all. Once your books are clean, we’re also here to collaborate and create a sustainable system that makes your ongoing bookkeeping feel like a walk in the park – for you and your wallet.

And we know this sounds cliche, but the sooner you get started, the better. We’ve got two good reasons:

1. Lower cost in the long run = great investment

A little catch up bookkeeping now can save you big bucks down the road. Not only will you pay less in clean up costs, but you can avoid penalties, maximize deductions, and make better financial decisions, making for a great return on your investment.

2. Proactive instead of reactive problem-solving

Don’t wait for problems to pile up before tackling them – think overdue bills, unauthorized withdrawals, duplicate transactions, uncollected invoices, etc.

Quality catch up bookkeeping helps you spot potential issues early, allowing you to solve them proactively and stay ahead of the game. It’s time to manage your finances the way your business deserves.

Ready to pass the baton to us? We’re here for the hand-off. Get started with your catch up bookkeeping today!

How Often Do I Need Catch Up Bookkeeping?

The short answer here is: hopefully, once!

The majority of our clients at Acuity go through clean up bookkeeping services with our team of controllers before working with an experienced bookkeeper. From there, they’re on an ongoing bookkeeping cadence that best suits their needs.

Still, every business is unique, and some may require more than one bookkeeping clean up, depending on their specific needs. It’s important to find a solution that works best for you to keep accurate books.

In terms of what ongoing bookkeeping services look like after cleanup services, here’s a glimpse into what our service offerings at Acuity:

We offer daily and weekly services to our bookkeeping clients. Weekly services are included in our most popular bookkeeping packages.

So, how can you tell whether daily or weekly bookkeeping is the right fit for your business?

The short answer here is that it’s complicated – everything depends on your business’s financial situation. However, here’s some loose guidance:

  • Weekly: Weekly bookkeeping is our baseline recommendation for any given type of client. This is the best solution for people who say, “I need to make decisions. Can I pay this bill this week? Or should I hold off until the end of the month?” or “Did this client pay? Or is their payment still outstanding?”
  • Daily: Daily bookkeeping is a step above for the type of client who can’t stay on top of their accounting needs with weekly support. They may have a high volume of transactions on a daily basis, a complex accounting system, high-touch needs in cash flow management, or strict obligations in regulatory compliance.

How Much Does Bookkeeping Catch Up Cost?

No matter how far behind you are, our catch up bookkeeping services are designed to help you get caught up – quickly and easily. For just $135 an hour, you can have an expert accountant come in and help you get things tidy!

And the best part? You only ever pay for how much you need – whether that’s one hour or 20 hours.

After we scrub those books, our basic bookkeeping package is just $449 per month and provides all of the essentials for your business, including real-time financial data updates, financial statement preparation, and strategic quarterly insight from a CFO.

Schedule a free consultation with our team to get an individualized quote at the best price for your business.

Curious where your books stand?

Find out how much cleanup you need with our free Financial Health Score.

Get Your Score
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How To Keep Up With Bookkeeping After Clean Up

1. Schedule regular money dates.

Get cozy with your finances by setting aside regular “money dates” – a time when you and your numbers can spend some quality time together.

If you’re still doing your own bookkeeping, you’ll want to block off an hour or two every week to review and reconcile transactions. But regardless of who manages your books, you’ll still want to track your income and stay on top of business expenditures every week, if not daily.

The more often you commit to doing bookkeeping, the easier it is to complete and the lesser chance you have of spinning a messy financial web.

2. Capture receipts on the fly.

Say goodbye to that shoebox stuffed with crumpled receipts. Snap a pic of your paper receipts with your phone and upload them to your accounting software or a receipt management app.

Not only will you save time, but you’ll also be more prepared for an audit. Score!

3. Enlist some expert help.

We get it! Entrepreneurs have incredibly busy schedules. And sometimes, we all need a little help from our friends – or in this case, an experienced bookkeeper or accountant – and that’s totally normal.

Our team of financial experts can help you stay compliant, maximize your earnings with tax filings, and make sure that your financial documents are in tip-top shape. Get started today, and consider it an investment in your future success.

Frequently Asked Questions

What's the difference between catch up bookkeeping and bookkeeping clean up?

There is no difference! Catch up bookkeeping and bookkeeping clean up are used interchangeably to describe the process of getting your financial records organized and up-to-date. It’s like tidying up your business’s accounting mess, so that you can make better business decisions and keep operations running smoothly.

What does catch up bookkeeping have to do with taxes?

Catch up bookkeeping plays a crucial role, not only in preparing accurate tax filings, but in ensuring tax compliance throughout the year. Clean books allow you to accurately report your income, expenses, and other tax-related information, meeting all regulatory requirements while reducing the risk of penalties, interest, or audits due to non-compliance. They also help you identify and claim all eligible tax deductions and credits!

What are some common bookkeeping errors that can impact my business taxes?

Common bookkeeping errors that can impact your taxes include incorrect expense categorization, unrecorded transactions, unreconciled accounts, and inaccurate revenue recognition. With catch up bookkeeping, you can ensure your financial records accurately reflect your business’s activities, ultimately leading to accurate tax filings and reducing the risk of audits, penalties, or missing out on deductions and credits.

Can I do catch up bookkeeping myself, or should I hire a professional?

While you can do catch up bookkeeping yourself, hiring a professional may save you time and money in the long run, ensuring accuracy and reducing the risk of any tax-related issues.

Ready to outsource your catch up?

We’re here to help! Check out our catch up bookkeeping services to see if Acuity is the right fit for your team.

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