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Easy Does It -- Bookkeeping Catch-up One Month at a Time

Sep 22, 2020 11:00:00 AM Cheryl Coyle QuickBooks, Small Business, Bookkeeping

desk piled with papersWe are approaching the time of the year when small businesses look at their books and realize they are behind, and in some cases, really behind. The knee-jerk reaction is to start adding and reconciling transactions all at once. Best practice indicates otherwise. We recommend you take a step back and do one month at a time.

Why Not Enter Six Months of Transactions at a Time?

Mass entering transactions may seem like a good idea – get it all done at once, right? Actually, it’s better to take it slow. Enter transactions for a month, reconcile all accounts, and review your financial statements for accuracy. It’s easier to correct a problem in a single month before moving on and getting lost in the minutia.


The Process

Gather Your Data

You will need your bank, credit card, and loan statements, as well as payroll reports by month, for the duration of the months you are catching up. Taking the time to bundle these items by month will save you time. Or if you like to use electronic information, save the statements you need in a file to pull as needed.

Enter Transactions & Reconcile

Once you have the data, enter and categorize your transactions (start with the first unreconciled month).

Reconciling your accounts accomplishes two main things: 1) It ensures you don’t miss business expenses, and 2) It identifies mistakes you or your bank made (entering income or expenses twice for example).

If a lot of your transactions are not in QuickBooks, there are many cost-effective applications to upload the information from the bank statements into QuickBooks. If you only have bank statements, consider DocuClipper or Propersoft. Be very careful that you are only uploading transactions that are not already in QuickBooks. You don’t want to create the challenge of multiple transactions.

Set Up Rules in QuickBooks

Setting up rules will make managing transactions in future months more efficient. You can always edit existing rules, delete and copy rules.

Clear Out Old Unreconciled Items

Make sure you investigate unreconciled items at the end of each month before you move on to the next month. Are they valid or duplicates? You may need to void and reissue a check or remove duplicates to ensure your financial statements are correct.

Do a Complete Monthly Review at the End of Each Month

Before moving on to the next month, do a complete monthly review to make sure everything is in order. Use our easy to follow Quick Audit form so you don’t miss anything.

Need help?

Find out how we can assist by clicking below to schedule a free consultation or read more about our catch-up service.

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Cheryl Coyle

Written by Cheryl Coyle