Should you catch up your own books or hire a bookkeeper?
It depends on how far behind you are and how tangled the records are. Two or three months on one checking account can often be done in an afternoon or two. A year of mixed cards, unmatched deposits and a QuickBooks file someone else set up is a different job, and that's the point where help earns its keep.
Wikipedia's Warren entry describes the city as home to a wide variety of businesses, from the General Motors Technical Center to the Detroit Arsenal.
Which situation are you in?
Find the row closest to your business. The last column is the first thing to do this week, whichever way you decide.
| Your situation | Best call | Why | First step |
|---|---|---|---|
| A few months behind on one bank account | Do it yourself | You can still explain each transaction from memory | Download the missing bank statements |
| Most of a year or more behind | Hire help | Old transactions get harder to explain every month | List every account and card the business used |
| Your tax professional is waiting on the books | Hire help now | A deadline leaves no room to learn as you go | Ask which reports your tax professional needs |
| A past bookkeeper or a software switch left a mess | Hire help | Errors in old months change every report after them | Save a backup copy of the file before changing it |
| You catch up, then fall behind again | Catch up, then hand off the monthly work | The backlog returns unless someone owns each month | Set one fixed day each month for the books |
If more than one row fits, the deadline or the messy file wins over the short backlog.
What does catching up actually involve?
The same steps, whoever does them. Start with the bank, because the IRS page on what records to keep says that for most small businesses the business checking account is the main source for entries in the books.
- Pull the bank and credit card statements for every month you're behind.
- Gather the paper trail: invoices, receipts, paid bills and deposit slips.
- Enter or import each transaction and give it a category.
- Reconcile the oldest month to its statement before you touch the next one.
- Fix duplicates, missing entries and anything filed under the wrong category.
- If you collect Michigan sales tax, check that the tax recorded lines up with your sales.
- Run a profit and loss report and a balance sheet for the period, then read them for anything odd.
The same IRS page says to keep supporting documents in order and in a safe place, organized by year and by type of income or expense. Do that as you go and the last step gets much easier.
When is doing it yourself the right call?
When the backlog is short and simple. Paying someone to catch up two months on a one-account business is often more than the job needs. If your bank feed is connected and nothing odd happened in those months, block out an afternoon and work through the steps above.
Where does a DIY catch-up usually go wrong?
Three places. People start with the most recent month, so the older errors stay buried. They guess at categories they can't remember, which skews every report that follows. And they mark an account reconciled when the balance only matches because of a fudge entry. If any of those sounds like your file, stop and get a second pair of eyes on it.
When should you hand the backlog off?
When the time it costs you is worth more than the help. Most of a year behind, several cards, a tax professional asking for numbers, or a file a past bookkeeper left half done: each of those is a reason to stop wrestling it alone. The longer it sits, the fewer transactions you can explain.
A good catch-up leaves you with reconciled months, organized receipts and a clear picture of where the business stands. It should also leave you a plan for staying current, so you aren't back in the same spot next year.
Not sure how far behind you really are?
Call TrustBooks Bookkeeping in Warren for a free consultation.
How far back do your records need to go?
Far enough to back up what goes on the return. The IRS recordkeeping page says you must keep records as long as they're needed to prove the income or deductions on a tax return, and that proving those entries is your responsibility. Ask your tax professional which years are still open for you, then catch up those first.
Catch-up bookkeeping in Warren and nearby towns
TrustBooks Bookkeeping is based in Warren, in Macomb County, and Vince Gonzales owns and runs it. You get direct access to your bookkeeper. Our Warren bookkeeping page covers what we do in the city, and our service area also takes in Center Line, Sterling Heights, Madison Heights, Fraser, Roseville and Eastpointe.
Our catch-up and clean-up bookkeeping covers cleaning up and categorizing past transactions, reconciling past periods, correcting errors and discrepancies, and organizing receipts and documents. We can also set up a system going forward and show you how to use it, or move you onto monthly bookkeeping once you're current.
Hours are Monday to Friday, 9am to 5pm. Send a note through the contact page and we'll get back to you within 24 hours.
Get back on track before the next deadline
Book a free consultation and talk through where your books stand.
