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