Bookkeeping Cleanup
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Bookkeeping Cleanup: What is it, Why You Need it and How Much Does it Cost?
Imagine you’re a small business owner who records transactions at the end of each week. You go to review your numbers, but your reports don’t look right. Your profit and loss shows a loss when you expected a profit, your accounts don’t match your bank balances, and nothing feels reliable. At that point, it becomes difficult to understand how your business is actually performing.
This is where bookkeeping cleanup comes in. A bookkeeper reviews your records, corrects errors, and organizes everything properly so your financial reports make sense again. Once cleaned up, you're able to see where your business truly stands.
To put it simply, bookkeeping cleanup is the process of reviewing and correcting your financial records to make certain that everything is correctly organized, categorized and current.
If you have not done any bookkeeping and you need to be caught up, you're most likely looking for Catchup Bookkeeping.
Why do I need Bookkeeping Cleanup?
Bookkeeping is an essential part of a growing business. If your books are a mess, you cannot trust your financials. Without trustworthy financials you will not know where your business is at its strongest or weakest. For example, lets say you're a business that sells both products and services. You might be recording these both under the same revenue account, but this would be incorrect. Without categorizing these correctly into separate revenue accounts you won't see where your money is actually coming from or what you may need to cut because the cost of keeping that product or service just is not worth it.
Not only is Bookkeeping Cleanup good for overall business health, it removes a giant headache when it comes to tax time. A good bookkeeper will be able properly categorize all of your transactions to help ensure your business expenses are properly categorized so you do not miss legitimate deductions. Even better, once tax time arrives, you can confidently hand off your books and financial statements to a tax professional knowing everything has been organized properly. This makes the tax preparation process easier and can even reduce tax prep costs.
If you're not sure you need bookkeeping cleanup, I will list some problems that bookkeeping clean-up can fix. If you relate to any of these problems I suggest you look into getting a bookkeeper to clean your books:
-Missing receipts or invoices that have not been properly organized
-Bank accounts and credit cards are not being reconciled consistently
-Personal purchases are mixed in with business transactions, creating accounting and tax issues
-Financial records are incomplete, inaccurate, or outdated
-Difficulty generating accurate financial reports when needed
-Trouble estimating or preparing for upcoming tax payments
-Disorganized records that make audit preparation stressful and time-consuming
-Poor visibility into business spending, making cash flow harder to manage
How Much Will Bookkeeping Cleanup Cost Me?
Now that we've covered why you may need bookkeeping cleanup, let's discuss how much this could potentially cost you as it can vary depending on your needs.
The cost usually depends on things like how far behind the books are, how many bank or credit card accounts need to be reviewed, how many transactions the business has, and whether personal and business expenses have been mixed together. The more organized your records already are, the easier and more affordable the cleanup process usually is.
If you are not sure how much bookkeeping cleanup your business needs, it may be a good idea to look for bookkeepers who offer a free consultation. You do not have to choose the first option you find. Take the time to compare a few different providers, ask what is included, and get an idea of the average cost. This can help you find a service that fits your needs and your budget. Some bookkeeping services may also offer payment plans, so if you feel cleanup is worth it but cannot pay everything upfront, you may still have options.
We Can Help!
If you found this helpful and think your books may need cleanup, we would be happy to help. Schedule a free consultation with us today, and we’ll take the time to understand your situation, answer your questions, and explain what your business may need to get your books organized and up to date.
