Year End Checklist For Small Business Bookkeeping

And, obviously, the sooner you send out invoices, the sooner you’ll get paid. Unearth any unpaid bills to ensure they get processed in the correct accounting period before you close out your year. In the meantime, you’ll need to analyze all the unreconciled expenses that have flowed through your shared account to determine which were business-related, and which ones were personal. As we get closer and closer to year-end most businesses will begin thinking about taxes. By the time year-end passes and you actually start to think about your bookkeeping and taxes you are too late.

bookkeeping checklist

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Review Month

Pay Federal Unemployment Taxes – If you have employees, you may be required to pay unemployment taxes on a quarterly basis. Employers are required to deposit these taxes on a quarterly basis, but only if the tax due is more than $500.

This will give you a good idea of what your cash position will be tomorrow. Many small business owners skip this step and I scold them over it. I think many owners dislike taxes so much that they are actually afraid to see what their potential tax liability is. You need to review your taxes with your CPA prior to year-end for two very important reasons. Petty cash is essential to run day to day business operations smoothly. So, bookkeepers should maintain a petty cash book, write slips each time cash is taken out, enter petty cash entries into software and reconcile it at the end of the month. The bookkeeper works as a liaison between different departments and interacts with department heads daily to discuss their inventory needs.

Not only does this allow you to generate the necessary reports for understanding where your company stands financially, it gets you ready to file your annual tax return. Working with a proven accounting professional can help you accomplish both of those goals. As year end approaches, we need to give our bookkeeping records a really thorough review so that our records are clean and organized for taxes. This checklist was written with my clients in mind , who often use QuickBooks Desktop or QuickBooks Online.

bookkeeping checklist

Your business is responsible for the calculation, collection, and payment of sales tax if you reside in one of the 45 participating states. Though you need to make quarterly sales tax payments, calculating and filing the sales tax on a monthly basis helps make the quarterly payment process less inundating. Keep in mind that in addition to state sales tax, your county, city, or even district may hold its own sales tax requirements. While staying current with customer invoices is crucial, reviewing your own invoices with vendors is equally imperative. Therefore, regularly review all vendor invoices and accounts to ensure that you are up-to-date on all payments.

We’re also looking at how many accounts a company has and is using (savings, checking, credit card, PayPal, Stripe, etc.). More accounts leads to more complexity, and we tend to think that some banks are better than others. Bookkeepers’ task list also includes the preparation of profit and loss statements, balance sheets, and other business reports. These reports keep management well informed about the business’s current financial position.

Document And File Receipts

Whether you have a seasoned or new business, brick and mortar shop, or online store, you need to handle numerous monthly accounting tasks. Profit and loss statement, also referred to as the income statement, reports earnings, expenses, and net profits for a specific period. Business accounting is the process of gathering financial information on your activity to produce financial statements. Deposit Profit Sharing – If your business has a 401, you must deposit any profit sharing from the previous year into employee accounts prior to the business tax filing deadline. Profit & Loss Statement – In addition to your balance sheet, you should also complete a Profit & Loss Statement (also known as a P&L Statement or Income Statement) each month. This will show you how much money you made for the month, and may be a record keeping requirement depending on your business structure.

  • Many accounting software systems let you scan paper receipts and avoid physical files altogether.
  • It’s better to stay on top of your tax filings so they don’t pile up and overwhelm you when deadlines approach.
  • I’ve been ordering Quickbooks computer checks, laser tax forms and other bookkeeping supplies from these people since 1998.
  • We tell our clients to stay on top of 1099’s throughout the year rather than waiting until the deadline is looming.
  • Plus, verify the deposit slip matches the amount entered in the bookkeeping.
  • When it comes to daily accounting business needs, you have a pretty light plate.
  • After reconciling your bank and credit statements, turn your attention to Age Accounts Reports.

Most importantly, by reviewing this, you need to accurately record your COGS and provide an accurate net income at the end of the year. Complete all of your federal or state payroll reports that are due. Some states require that these be reported monthly or quarterly.

Bookkeeping Quickbooks Task List

The best thing you can possibly do for your bookkeeping and taxes is to reconcile QuickBooks. A reconciled QuickBooks file that can be confirmed with a bank statement does a lot of positive things for your business. A bookkeeper has to establish an open communication environment for colleagues and clients. Bookkeepers have to communicate with other employees to manage travel expenses, reimburse employee’s expenditures, petty cash reconciliation, and more. Your business’s success depends on multiple factors, including planning, strategizing, and marketing. But, out of all the business development practices, accounting and financial management is the core success factor—because inadequate money management can completely derail your business.

Be sure to review your cash balance and the health of your cash flow. Prepare and send out your invoices, and receive payments on invoices. Not every nonprofit and church uses invoices, but it is common for private schools, member-based entities, and some nonprofits. The IRS has a January 31 deadline for reporting the annual earnings of your full-time employees (W-2s) and most independent contractors . This deadline includes mailing copies of the tax forms to the people who worked for you. While you’re at it, you’ll identify trouble spots and make adjustments to improve sales and margins. If you have not prepared a budget, compare your current year-to-date P&L with the same prior period, year-to-date income statement to identify variances and make adjustments.

As a bookkeeper, there is no shortage of tasks, and overlooking just one can bite you later on down the road. All you need is a simple statement showing your current cash position, expected upcoming cash receipts, and expected cash payments for this period.

Just as you record any invoices sent to the client, document all customer payments as soon as the payment is received. This should take place before completing bank reconciliations and reviewing bank credit card accounts.

Annual Business Accounting Tasks

Not every small business can hire the help of a Certified Public Accountant to produce financial records, manage cash flow, complete tax returns, and analyze the financial health of their company. Before moving on to anything else, you need to review the accuracy of your business cash and credit transactions in order to work with your exact cash position. To do so, reconcile your bank accounts and credit cards at the close of each month, helping you easily find and amend any mistakes. This can be done by reviewing your statements to flag any suspicious credits, debits, canceled transactions, or double charges.

Most people hate getting hit with any unexpected bills and taxes should be treated no differently. If you do owe at least you will be prepared and you will not be surprised by your tax liability. I always tell clients to let their contractors know they can get paid as soon as they submit a filled out W-9 form; works every time. Most businesses are aware that they should request a W-9 form from their vendors, but very few actually follow through and complete the task. Do some research on any suspicious balances and request statements from those vendors.

There are a lot of accounting tasks you need to perform to keep your business running smoothly—daily tasks, weekly tasks, monthly tasks, quarterly tasks, and annual tasks. Having a checklist helps ensure that no tasks fall through the cracks—and you successfully complete all the necessary bookkeeping to-do’s for your business. As soon as you send billing statements and invoices to customers, make a record of it where you can easily assess the status of customers’ payment positions. It’s common for small business owners to get distracted by other tasks of running a company, and you don’t want to forget to send an invoice or send the same invoice twice. Accounting software like QuickBooks can help you generate financial reports, manage taxes, and take care of other small business accounting tasks.

Once you have thoroughly examined your monthly bank and credit statements and are confident in its accuracy, you can complete the rest of your monthly bookkeeping tasks. Accounting is an essential part of running a business, whether you’re a small mom-and-pop shop or a large corporation. With the business accounting basics under your belt, you’ll be able to get started on keeping track of your company’s financial information. Small business owners who recently opened their doors may feel inexperienced with the operational tasks involving bookkeeping. Quickly, they understand that running a company involves more than selling products or services, growing your client base, and increasing revenue.

Again, it’s best if your payroll service provider completes these reports and files them. Your job is to review payroll processes and data to make sure they appear reasonable. To ensure you are keeping best practices, view our What Is Payroll guide, created by accounting experts. A checklist will make sure nothing falls through the cracks.

However, don’t stop reading because this is by far the most important step. Nothing is more frustrating and stressful than having a 1099 independent contractor mess in January. You already have enough on your plate in January and the last thing you need is another deadline. You want to be focusing on sales and growth to start the new year not 1099 compliance and taxes. We provide third-party links as a convenience and for informational purposes only. Intuit does not endorse or approve these products and services, or the opinions of these corporations or organizations or individuals.

Your accountant will make sure you don’t file any mistakes, but you should have a good idea of where your business is at and where it’s going. Working with a remote bookkeeping service will still provide you with all the value you could get from an in-office bookkeeper but at a fraction of the cost. The easiest way to wrap up one fiscal year and get ready for the next is with a systematic approach to getting your books organized. Follow these simple steps and bring your CPA the cleanest set of books you ever had. One last thing, don’t forget that tax review before year end…it’s just that important. When you leave your bookkeeping duties for too long of a time it can also take a hefty investment of both time and money to help set them right. You have followed through the checklist thus far and all before year-end…good for you.

Take a deep, calming breath and get ready to tackle those accounts with a plan for streamlining the process. Even if you’re facing down the new year, use this checklist to help get you ready and implement a plan for next year.