Small Business Owner’s Bookkeeping Checklist

Here is a bookkeeping checklist to get you prepared and organized for filing. This list is meant to provide you with a general idea of items to prepare. If you have questions, give Rick S Vourganas CPA a call or email us, and we will be happy to help you.

1 Get Organized: Find all of the receipts for any deduction you are claiming on your tax return. No receipt equals no deduction. The best way to stay organized during the year is to enter your transactions into an accounting software such as QuickBooks.  After collecting all receipts, look over your personal bank statements for any business charges you paid for out of your personal account. Do the same with your business bank statement, but this time look for any personal expenses paid out of your business account.

2 Reconcile Your Bank Accounts: Bank reconciliations can help to verify all transactions have been posted to your accounting software. This ensures your general ledger bank balance (the bank balance in QuickBooks) matches your bank statement. Fix any mistakes you discover in the process.

3 Invoice: Have you invoiced all of your customers for work you’ve done and products you’ve delivered/shipped for the year? Make sure you are caught up on those invoices.

4 Collections: Follow up with any customers who owe you money. Send them a past due statement and/or give them a call to remind them they owe you money.  Look through your accounts receivables. Are there any receivables that you are unable to collect that need to be written off your books or sent to a collection agency?

5 Inventory: Verify your inventory balance is correctly reported on your balance sheet. The best way to do this is to have an accurate count as of December 31st. You’ll also want to verify that your inventory is valued correctly – determine if any inventory items cost more than they’re worth and need to be written down. Remember, we are going to need the following in order to prepare your tax return:

1. Inventory balance at the beginning of the year (January 1st)
2. The cost of inventory purchased throughout the year
3. The amount of inventory that was sold during the year
4. The ending inventory balance as of December 31st.

6 Fixed Assets: These are the larger purchases you made throughout the year (i.e. equipment, automobiles, furniture, computers, etc.). Make sure you still have all of the fixed assets that are reported on your balance sheet. If not, record the sale or disposal of these fixed assets. Don’t forget to verify the depreciation on your fixed assets as well (if you don’t know how to do this, contact us for help. We will be able to generate a depreciation schedule for you).

7 Expenses and Accounts Payable: Verify all of your accounts payables have been recorded.
Collect your cell phone bills & internet bills for the year and determine what percentage of your cell phone calls were for business purposes and what percentage of your internet was used for business.
Now is the time to make your 401(k), SEP IRA, and Simple IRA contributions.

8 Notes Payable: Verify your notes payable (i.e. loans) amounts on your balance sheet match the statements from your banks. Are you missing any notes payables? Do you have any notes payables that you paid off during the year or debts that were forgiven? Make any necessary adjustments. Not sure how to make the adjustments? No worries, make a list and we will help you make the necessary adjustments.

9 Mileage: This year you can deduct 53.5 cents per mile for business miles driven in 2017. That means any trips to clients or for meetings are deductible. Keep a notebook in your vehicle in order to keep track of the mileage. We use the Mile IQ app which will track your mileage for you. Note: your daily commute does not qualify for the deduction.  The IRS also gives businesses the option to calculate the actual costs of using your vehicle (i.e. gas, maintenance, repairs, etc) rather than using the standard mileage rate. If you go this way, you will need to determine the percentage of time you use your car for business and use this percentage to calculate your deduction.

10 Collect W-9’s: Collect W-9’s from your vendors and/or contractors you paid $600 or more to throughout the calendar year. Don’t forget your 1099’s are due on January 31st.

11 Payroll Taxes: Verify your payroll tax liabilities match your quarterly payroll returns.

12 Double Check your Profit & Loss (aka Income Statement): Do your income and expense numbers make sense? Compare your profit and loss statement against prior years and against your budget. Think long and hard to make sure there is no additional income you are missing (i.e. advertising income from your blog, any contract work you did, etc.) and no additional expense items you are missing (i.e. those missing receipts you’ll find at the bottom of your purse or in your junk drawer). Make any necessary adjustments. Remember, No receipt equals No deduction.

13 Next Year’s Budget: Create a Budget for Next Year.

14 Back Up: Back up your Quickbooks file to protect from loss of data.