How to Catch Up on Months of Unreconciled QuickBooks
To catch up on QuickBooks, connect or import every bank and card account, categorize the backlog month by month, reconcile each month to the statement, then fix duplicates and uncategorized items. For a small business this is usually a few hours per month of backlog, which is why cleanup is often priced per month of catch-up.
Signs your books need cleanup
- Bank and credit card accounts haven't been reconciled in months.
- Large balances sit in Uncategorized Income, Uncategorized Expense or Ask My Accountant.
- The QuickBooks bank balance doesn't match the bank statement.
- Transactions show up twice because both the bank feed and manual entries recorded them.
- Your tax preparer asked for a profit-and-loss statement and you weren't sure the numbers were right.
The catch-up process
- Gather statements. Download every bank and credit card statement for the months you're behind.
- Check the starting point. Find the last month that was reconciled correctly. Everything after it is the backlog.
- Bring in the transactions. Use the bank feed where it covers the period and upload statement files where it doesn't.
- Categorize month by month. Set up bank rules for recurring vendors so the same payee lands in the same account every time.
- Reconcile each month. Match the ending balance in QuickBooks to the statement before moving to the next month.
- Clean up what's left. Remove duplicates, clear uncategorized accounts and match transfers between accounts so they aren't counted as income or expenses.
- Review the reports. Run a profit-and-loss statement and balance sheet and check that they make sense.
What cleanup costs
Pricing depends on how many accounts you have, how many transactions you have each month and how far behind the books are. At PMD Financial, the review is free and cleanup is quoted as a fixed price, typically $100 to $150 per month of catch-up for a small business. Ongoing monthly reconciliation is $150 per month.
When to get help
If you're more than a few months behind or tax season is close, handing the backlog to a bookkeeper is usually faster than learning the cleanup process yourself. Clean books also make your tax return quicker and cheaper to prepare.
Frequently asked questions
How long does it take to catch up on bookkeeping?
It depends on the number of accounts and transactions, but a small business with one bank account and one card often takes a few hours per month of backlog.
How much does bookkeeping cleanup cost?
PMD Financial reviews your file for free, then quotes a fixed price, typically $100 to $150 per month of catch-up work for a small business.
Do I need clean books before filing my taxes?
If you're self-employed, your Schedule C is built from your income and expense records, so accurate books lead to an accurate return and fewer questions if the IRS ever asks.
Questions about your own return or books? Get in touch or call 949-423-8885.