Bookkeeping Clean-up Checklist: Unravel Your Accounting Knots

As your client base grows and you hire more hands, you’ll need a standardized, efficient, and fast way of completing QuickBooks cleanup for your clients. This is where our QuickBooks Cleanup checklist template comes in handy. The Zeni platform features an easy-to-use interface bookkeeping clean up checklist with customizable views for different users. You’ll have access to a GAAP-compliant chart of accounts and key reports — without dedicating hours of your time to bookkeeping clean up. Whether you hire a QuickBooks cleanup service or not, a bookkeeping cleanup project can be time-consuming, and it isn’t a one-time job.

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An often neglected part of the bookkeepers’ duties involves making sure all your financial data has a functioning backup system. Many online bookkeeping platforms and account software systems simplify this process by automatically saving backups of your data securely to the cloud. If you choose to manage your own data backup system, be sure assets = liabilities + equity the data you hold is secure for the benefit of the company and your customers, clients, and partners. Depending on your industry, you may face additional security requirements based on federal regulations. This is the case for healthcare providers who are required to encrypt health data in compliance with HIPAA.

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Many businesses lack the time, expertise, or resources to handle this task independently, so they turn to firms like yours to bring order to their financial chaos. A thorough bookkeeping cleanup ensures that their records are accurate and up to date and allows them to make informed decisions. For instance, a negative number in your accounts receivable report might indicate a payment received without a corresponding invoice. Address these discrepancies promptly to ensure accurate financial reporting and a smoother tax filing process. Our https://www.bookstime.com/articles/back-office-accounting Bookkeeping Clean Up Checklist is a step-by-step guide to turning your messy books into clean accounting records.

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Clean, accurate books demonstrate financial responsibility and can improve your chances of loan approval. Pramod has over 11 years of experience relating to finance and accounts in diversified industries. He is an expert in resource and process optimization resulting in greater operational efficiencies. This function will capture any transaction that has been posted to an account after it has been reconciled, thereby preventing any complications for all parties involved. The average bookkeeping firm has multiple QuickBooks cleanup works running simultaneously. It also helps you communicate the changes you made to a client’s book (when necessary).

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• By auditing your receivables, you can ensure that all outstanding invoices or unpaid bills are appropriately recorded and that you follow up with clients/customers who still need to pay.
• Clean bookkeeping means you don’t have to keep track of the client who is 90 days overdue on their payment or anticipate what your cash flow position will be next week.
• Apart from establishing effective financial strategies, the software and checklist will streamline your financial processes and establish a foundation for long-term business success.
• A recent study by the National Small Business Association found that 42% of small business owners struggle with bookkeeping tasks.
• Good bookkeeping is about much more than organization; it’s about doing better business and saving more in taxes.
• In short, bad bookkeeping puts your time and money—and maybe even your business—on the line.

Ensure your client meets all tax obligations, including sales tax, income tax, and payroll tax, to help them avoid penalties and maintain compliance with tax authorities. Identify and correct duplicate invoices or vendor overpayments, ensuring expenses aren’t inflated. Help the client prioritize payments to avoid late fees and maintain strong vendor relationships. With all the automatic importing of transactions and automatic categorization, it can be easy to overlook this step. Ensure you review the expense accounts at the end of each month to verify that the transactions have been posted to the proper expense 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. Another vital step in our “how to clean-up messy bookkeeping guide” is to keep your financial documents organized, clear, and accurate. This way, you can get information quickly, and all records are available for audits or financial reviews.

• Start by putting your bank statements, receipts, and invoices chronologically to track transactions over time and see patterns in your financial activity.
• Automation can help streamline the accounting process, freeing up you or your accounting department to perform higher-level thinking and assessments.
• That’s why your friendly neighborhood SnapBooks team has created these simple steps to help you untangle your financial records.
• Finally, generate an accounts receivable aging report to categorize overdue invoices by time period.
• It is the duty of your accounting team to identify and correct the discrepancies found.

These reports will give you insights into your business’s financial health and help you make informed decisions. Common reports include the profit and loss statement, balance sheet, and cash flow statement. Remember, disorganization breeds dysfunction and delays, but superior organization in your accounting process can help your business function more smoothly at a quicker pace. It’s similar to reconciling your bank accounts to reconcile your credit card balances.

Set reasonable expectations

After all your hard work cleaning up your books, the last thing you want is to lose that valuable data. If you’re not already using an online, cloud-based accounting system , you should consider it for next year. A cloud-based accounting system can be helpful when it comes to syncing tasks, sourcing information, completing forms quickly, and double-checking to make sure everything is in order. You can easily adapt it to address the unique needs of each client’s QuickBooks Cleanup. The goal is to provide an appropriate level of detail — not too much, not too little — to demonstrate historical trends and predict future cash flow or performance. Clear financial understanding is essential for businesses during recessions, emphasizing accurate bookkeeping for strategic decision-making and sustainable profitability.

• For a clean up, I charge by the hour and I let the client know I will check in with them after 5 hours.
• Once you’ve verified that you have all the information you need to complete your accounting process, you should enter (or import) your cliens’ information into your accounting software.
• If keeping your records in a shoebox was a good enough system three years ago, it’s clearly not enough at this point.
• When you’ve reconciled your cash accounts, do the same for any lines of credit.
• An important part of the process is ensuring your documentation is properly filed away (whether physically or electronically) so you can find the backup if any questions are raised later.
• The major benefits of managing accounts payable and receivable include the capability for you to forecast cash flow, budget accordingly, and prevent cash shortages.
• The checklist provides a systematic process for maintaining clean accounting books ensuring that the business is set for growth, taxing time, and possible investments.

You should also get access to their QuickBooks account and an introduction to their tax preparer (if you need to work with them at some point). Veronica Wasek of 5 Minute Bookkeeping sees QuickBooks cleanup as a puzzle and believes all the puzzle pieces are needed to get it done. Until you have a signed service agreement and upfront payment from your clients, they are not clients. Knowing how to bring order and clarity to the chaos in a client’s QuickBooks file will enable you to earn more money in 2024–and beyond.