Glad we finally caught up

Catch-up bookkeeping (n): the process of bringing a set of books up to date all at once so a tax return can be filed.  

It’s not detailed or perfect, but it gets everything up to speed. 

Clean-ups are different. They’re for books that were done incorrectly. It’s almost always more straightforward and less work to start fresh with a catch-up than to sort through what’s already there. 

A catch-up usually looks like an untouched Quickbooks or Xero account with months of uncategorized transactions, bank and credit card accounts that haven’t been reconciled, and balances that are off. It might be a spreadsheet or only bank statements.

Transactions are reviewed and categorized, transfers are matched, and duplicates are removed. I’ll ask about anything that doesn’t make sense and assign categories based on what we’ve discussed. Accounts are reconciled back to the statements so the balances line up accurately.

If there’s payroll, it gets broken out properly. If there are loans, payments are split between principal and interest. If something was recorded incorrectly earlier in the year, it gets fixed.   

By the end, everything ties out and the numbers are usable. Your CPA can work from it, but it’s a very different process from keeping things current.  

If you just went through it, you know exactly what it feels like. And if you’d rather not do that again next year, let’s talk.