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Whether you’re applying for a loan or have simply lost track of your company’s finances, catch-up bookkeeping is extremely important.
It can also be very difficult to wrap your head around, but if you’re having trouble getting started – don’t worry.
This helpful guide will provide everything that you need to know to keep on top of your business’s financial health.
Specifically, this article will cover:
- What catch-up bookkeeping is
- A concrete example of catch-up bookkeeping
- How much catch-up bookkeeping costs
- Necessary steps to catch up on your bookkeeping
- The best catch-up bookkeeping services
- Whether catch-up bookkeeping is worth it.
No matter if you’re a strategic, economic, technical, or user-based buyer looking for a simple solution to the pervading problems that exist in your business accounts, this is the article for you.
Listed below are the three most important things to note about catch-up bookkeeping:
- Bookkeepers typically charge hourly at a rate of $30 to $100 per hour.
- For effective bookkeeping, you must gather company receipts, reconcile business bank accounts, and separate your business and personal expenses to make things easy for both you and the person reading your financial records.
- The best bookkeeping services are 1-800Accountant, Xendoo, and Bench Accounting.
What is Catch Up Bookkeeping?
Catch up bookkeeping is how individuals and businesses keep up to date with overdue financial records.
The term describes the process by which organizations reconcile and update their records, especially those that have been neglected or have fallen behind.
This practice has become more commonplace as financial systems have developed in complexity.
In fact, manual record-keeping used to be the status quo until the recent age of digital technology.
Feeling overwhelmed? Not to worry.
Although very important to maintaining your company’s financial health, it has never been easier to carry out catch-up bookkeeping.
Keep reading this guide and you’ll learn everything you need to know to be able to accurately keep track of your business’s expenses so that you may better prepare for the upcoming tax season.
Catch Up Bookkeeping Examples
A classic example of when catch up bookkeeping is required is of a small business that has fallen behind on its finances.
In fact, if you have ever run your own small business, you might even relate to the stress that this would cause.
Having focused most of their time on everyday operations, the owners of this small business have neglected its financial records for some time.
To stay afloat, they must apply for a loan, but the bank would never lend money to a company that has stacks of unsorted receipts, an inaccurate list of expenses, and an unreconciled account.
Without a clear analysis of the small business’s financial health, the bank would never consider approving a loan unless some serious catch-up bookkeeping is done.
How much does catch up bookkeeping cost?
Depending on industry standards and what different companies might charge for their services, the cost of catch up bookkeeping can vary.
The complexity of the business’s records, the length of time they’ve spent without expense documentation, and the expertise required are all factors to be considered.
However, in general, catch-up bookkeepers typically charge hourly at a rate of $30 to $100 per hour.
This will vary depending on whether a bookkeeper charges a flat fee, offers package deals, subscriptions, or scenario-specific quotes.
How to Catch Up on Your Bookkeeping
Ready to get started? To catch up on your bookkeeping, follow the simple steps below to learn what an individual or business must do to get on top of their finances:
- Gather company receipts – Time to lift up the rug and dig amongst the couch cushions, because it is extremely important that you find all receipts and invoices from when you first started to neglect your company’s finances. Make sure to store these in an orderly and safe manner so that you will not fall behind on your finances again in the future.
- Reconcile business bank accounts – To avoid discrepancies and errors, you now need to match your bank statements with your financial records and accounts. Spot any and all mismatches or mistakes.
- Separate your business and personal expenses – You are not your business, and your business is not you – so separate them. To avoid any confusion, it is best that your finances remain clear and distinct.
- Go paperless – To make your records more accessible and organized for both yourself and the bank, digitize everything. This will make your life a whole lot easier when it comes to sending them off to the relevant organizations who wish to view them.
- Collect all your W-9s, 1099s, and W-2s – Really get on top of things by having all the necessary tax documents on hand and ready to go come tax season. If you’re outside of tax season, it’s a good idea to have a look over them anyway so you know what will come up.
- Hire a tax professional to review your books – There’s no shame in seeking help! Businesses big and small will often hire an expert to support them in areas that they lack knowledge in such as bookkeeping.
Quick Tip: A great option is a catch-up bookkeeping service like 1-800Accountant (more on that below!)
Best Catch Up Bookkeeping Services
In fact, if you’re looking at hiring a professional bookkeeper, look no further.
Below are some excellent options:
This organization is well known for its accuracy and comprehensiveness. They will do everything you need from payroll to tax planning.
Want everything stored securely online? Xendoo is a cloud-based catch-up bookkeeping service that specializes in helping small businesses.
Bench Accounting is as professional as they come, with expert service for everything bookkeeping-related from general clean-ups to completely regaining financial control.
Is Catch Up Bookkeeping Worth It?
You now know everything there is to know about catch up bookkeeping. Great!
However, it’s not over yet. It’s important to remember that a continued sense of curiosity and hunger for knowledge is key to guaranteeing success in not only business but all industries.
Ask more questions, read more articles, and stay open to learning new things.
You’ve already taken the first step on your bookkeeping journey, so why not keep going?
Get on top of those finances and keep your business alive.
When does my business need catch-up bookkeeping?
Your business needs catch-up bookkeeping when your financial records are no longer up to date.
What is the difference between catch-up and clean-up in bookkeeping?
Catch-up bookkeeping is for updating your financial records, whereas clean-up bookkeeping is for fixing errors or inaccuracies in your current records.
How does catch-up bookkeeping work?
Catch-up bookkeeping works by gathering all financial documents such as receipts and account records so that they may be reviewed and organized.