Navigating Catch-Up Bookkeeping: Practical Management Tips:
Assess your financial status at this time.
As you are ready to catch up on your books, you need to assess the financial situation of your small business. Pay close attention to routinely checking bank and credit card statements, keeping an eye out for any anomalies, and keeping an eye out for any other activity that might be unusual.
By doing this, you’ll make sure you pay the right amount each month by avoiding fraud, removing unused memberships and recurring fees, and avoiding duplicate payments. Maintaining your financial records can help you avoid having to do catch-up bookkeeping later on and will save you time and money!
Sort and classify historical financial information
- After you are aware of your financial situation, you need to classify and arrange the information. Pay special attention to keeping invoices and receipts organized so you can find them easily.
- Classifying and preserving your data with accounting software, like 1-800 Accountant’s ClientBooks, is one of the easiest and safest ways to do so.
- Classifying your financial data and establishing rules for authorization and review are crucial components of this stage. In this manner, you can identify problems before they have disastrous consequences.
Balance bank statements and financial records.
It is important to confirm the accuracy of the data you have arranged. Compare your efforts to your financial statements to achieve this. This guarantees the accuracy of your transactions and enables you to identify any errors that might have occurred in earlier phases.
The sooner you can spot problems and inconsistencies, the better. This stage can also assist you in setting up access to cash reserves and important policies that centre around the payment authorization system for your small business.
Modifying financial statements
You need to make the appropriate corrections to your financial reports before your books catch up completely. This could be as complicated as separating personal and company accounts, or it could be as easy as that.
Additionally, you should make changes to the reports that list the payments made to full-time staff and contractors. W-2, W-9, and 1099 are a few popular forms that you must include information about in these reports. The paperwork you utilize will vary depending on the professionals you’re paying and their job status.
Put in place a method to prevent future backlogs in bookkeeping.
You should try to avoid falling behind on your studies in the future because it’s not fun. To achieve this, schedule time each week to update your books. Weekly bookkeeping can prevent a great deal of suffering down the road.
Additionally, you should automate as much of this procedure as you can to save time. When it comes to recording receipts and other data that was previously handled manually, this is quite helpful. To guarantee that your books are constantly up to date, you should also follow the procedures and guidelines you established in the earlier stages.
Our Virtual Bookkeeping Experts are here to help.