What’s the best way to catch up on bookkeeping if I haven’t really touched my books all year? I love this question I was recently asked. Not to be Debbie Raincloud here, but the first step is to stop being lazy.
Look, you didn’t start your business to do accounting. So, this idea of accounting and bookkeeping is not your favorite thing. I totally get that. I know it’s not laziness, it’s just procrastination because it’s the unknown.
Your accounting books are a really important tool that as a business owner you can use to grow your business. It gives you information that then helps you make better decisions.
Honestly, the answer is you gotta get it done and the best way to catch up on bookkeeping is to…
Hire an Accountant
Do you have some cash flow to use to pay someone to do your bookkeeping, including the catch-up work. If you have cash, it’s better to use somebody who does this all the time versus you taking some time whenever you sporadically have it, to get your books done. Because that’s why you’re looking for the best way to catch up on bookkeeping right now. Even that sporadic time you planned to do your books didn’t happen.
Consistency is better and having someone skilled in it is better. And no offense to our spouses or children or best friends or clients that don’t have accounting experience. They’re not the right fit to be our accountant. I’ve seen that a lot.
So that’s the first thing, do you have some cash flow to leverage to get you important information so that you can make better decisions? Based on the original question, if you fit into the criteria, I haven’t really touched my books, how do I get caught up? That means you’re not using your books to make financial decisions.
Analyze Expenses
Another great thing to always do when it comes to any financial decision is review your expenses.
In my book, Profit First for Microgyms, I have an entire chapter on how to analyze expenses and there’s nine questions for the analysis. And I love the nine questions.
I have since read some books by Keith Cunningham, the real “rich dad” of the book Rich Dad Poor Dad. He has an even simpler way to look at it. Look at your expenses one at a time and ask yourself for each one, does the expense bring in clients or does it help me retain clients? Ultimately, that’s what we’re trying to accomplish as a business to stay relevant. We need clients, we need new clients. We need to keep current clients.
So, does the expense do that? If not, let’s figure out how to cut the expense or can you do the same thing for less money? Go through your expenses. You’ll pry free some money and with that freed up cash, hire a bookkeeper to help you get caught up.
DIY
Now look, if you want to go the do it yourself route the only solution is to get it done. You have to schedule the time in. You have to stay focused and you have to put in the hours to get the bookkeeping done. There’s no magic formula or process, just do it!
So those are the solutions. If you haven’t really touched your books all year, how do you get caught up? Either, you just have to do it, if you must do it yourself, or you need to find the cash flow to pay someone to do it.
I know it’s overly simple, but often those are the right answers.
Talk to a professional today about catch-up bookkeeping so you can make better business decisions.
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