Every January, the advice starts flying.
“Get your books organized.”
“Make this the year you stay on top of your bookkeeping.”
“Don’t wait until tax season.”
It all sounds great.
Then real life happens.
You’re busy serving customers, returning phone calls, ordering inventory, managing employees, putting out little fires all day, and trying to grow your business. Before you know it, another month has gone by and your bookkeeping is still sitting there waiting for you.
I see this all the time.
And honestly?
I don’t think January is the best time to catch up.
I think July is.
That might surprise you, but after working with small business owners for more than 20 years, I’ve learned something.
The businesses that take a few hours in the middle of the year to get their books cleaned up almost always have a much less stressful tax season.
Here’s why.
You still remember what happened
Have you ever looked at a transaction from ten months ago and thought, “What in the world was this for?”
We’ve all done it.
But if you’re looking at something from March or April while it’s still July, there’s a good chance you’ll remember.
“Oh yeah…that was supplies for that big job.”
“That was when the truck needed repairs.”
“That customer accidentally paid twice.”
The longer you wait, the fuzzier those details become.
That’s when mistakes start sneaking in.
Let me tell you about one business owner
This is a story I wish never happened because it could have been avoided.
A local Queen Creek business owner had gotten behind entering transactions throughout the year. They fully intended to catch up. Life just kept getting in the way.
Sound familiar?
By the time December rolled around, they were in full panic mode.
They rushed through entering months of transactions because tax season was closing in. Since they were trying to finish as quickly as possible, they skipped reconciling each month against the bank statements.
Everything looked done.
But it wasn’t.
There were duplicate transactions that had been entered. Their expenses ended up being overstated. On top of that, their tax return was filed late, which meant interest and penalties.
Then came the phone call nobody wants.
The tax return had to be amended because the expense totals weren’t correct.
That’s a lot of extra work, extra stress, and extra money.
Not because they didn’t care.
Because they ran out of time.
That’s a huge difference.
Summer gives you room to breathe
Living in Queen Creek, we all know summer feels different.
The afternoons are hot enough that you plan your day around the weather. Monsoon season starts rolling in. If you’ve driven down Queen Creek Road lately, you’ve probably sat through at least one construction delay.
Business doesn’t necessarily slow down.
But the pace changes.
That makes July a great time to spend a little time getting your books caught up before the busy fall season and the holidays arrive.
Good bookkeeping isn’t just about taxes
Most people assume bookkeeping is only for tax season.
I don’t.
Good bookkeeping helps you answer questions all year long.
Can you afford to hire someone?
Is that new service actually making money?
Can you replace that equipment?
Are your prices still covering your costs?
Without current books, you’re making those decisions based on your checking account balance.
And your checking account only tells part of the story.
Little mistakes become expensive mistakes
Bookkeeping errors usually don’t show up all at once.
It’s one duplicate expense.
One missing deposit.
One bank account that never got reconciled.
One forgotten credit card.
By themselves, they don’t seem like a big deal.
But six or eight months later?
Now your reports aren’t telling the truth anymore.
The sooner you catch those little mistakes, the easier they are to fix.
Here’s something most bookkeepers won’t tell you
I don’t think small business owners get behind because they’re disorganized.
I think they get behind because they’re doing exactly what they should be doing.
Running their business.
You’re meeting customers.
Managing employees.
Doing estimates.
Answering emails.
Trying to build something for your family.
Of course bookkeeping gets pushed down the list.
The problem is that bookkeeping doesn’t disappear just because you don’t have time for it.
It quietly waits.
Then one day it’s tax season and suddenly you’re trying to remember what happened eleven months ago.
I’ve watched that cycle repeat itself more times than I can count.
And I’ve also seen the relief on someone’s face when they realize it’s finally caught up.
That’s honestly one of my favorite parts of what I do.
Your CPA will appreciate it too
Imagine handing your CPA clean, organized books next spring instead of a stack of questions and missing transactions.
Everything moves faster.
They spend less time sorting through problems.
You spend less time answering emails and searching for receipts.
Everybody wins.
My favorite reason of all
This one has nothing to do with accounting.
It’s about peace of mind.
I’ve had business owners tell me they dreaded opening QuickBooks because they knew they were behind.
Every time they logged in, they felt guilty.
That’s no way to run a business.
Once everything is caught up, that weight disappears.
You know where your business stands.
You trust your numbers.
You stop wondering if there’s something hiding that you’re going to discover next March.
That’s worth a lot.
If I could give every Queen Creek business owner one piece of advice
Don’t wait until January because everyone says that’s when you’re supposed to get organized.
Do it now.
Start with one month.
Match every transaction to your bank statement before moving on to the next one.
Don’t rush through it.
Slow and accurate wins every single time.
If you discover you’re farther behind than you thought, that’s okay too. More business owners are in that position than you probably realize.
The important thing is starting before you’re under the pressure of tax deadlines.
One afternoon in July can save you weeks of stress next spring.
And if nothing else, here’s one thing you can do today. Pull up your most recent bank statement and compare the ending balance to what’s in your bookkeeping software. If they don’t match, that’s your starting point. Don’t ignore it. Figure out why now, while the details are still fresh.
Your future self will be grateful you did.
If you look at your books and realize you’re further behind than you thought, I’m happy to help. I’ve spent more than 20 years getting small business owners caught up and keeping them that way. And when you need a CPA, an insurance agent, or anyone else in your corner, you’ll find them in our member directory.
Michelle Kalkowski, Desert Blooms Bookkeeping Services, LLC.