Between serving customers, managing employees, and keeping projects moving, bookkeeping can easily fall behind. As the year wraps up, a little attention to your financial records can help prevent a stressful scramble when your tax preparer asks for reports.
For contractors, trades businesses, and other small business owners, year-end is also an opportunity to understand where your money went—and which work actually made a profit.
Use this checklist to get started.
1. Bring your bookkeeping up to date
Make sure all business transactions have been recorded, including expenses paid personally, bank fees, financing transactions, and payments received through merchant processors.
Review uncategorized transactions and outstanding questions. Those “I’ll figure it out later” items can affect the accuracy of your financial reports.
2. Reconcile your accounts
Reconcile your bank and credit card accounts through December 31 once the final statements are available. Review loan balances against lender statements and investigate differences.
Downloading transactions into QuickBooks does not complete the reconciliation process. Your records still need to be compared with your statements to identify missing transactions, duplicates, and errors.
3. Review unpaid customer invoices
Run your accounts receivable aging report and check which invoices remain unpaid.
Follow up with customers, confirm that payments were applied correctly, and investigate old balances. For contractors, review retainage, progress invoices, and approved change orders so amounts owed are properly tracked.
Discuss potentially uncollectible balances with your bookkeeper and tax preparer before making adjustments.
4. Check outstanding bills and vendor balances
Review your accounts payable aging report for unpaid bills, duplicate entries, unused credits, and payments that were never applied.
Knowing what you owe helps you plan for upcoming cash needs and avoid surprises in January.
5. Organize subcontractor and vendor information
Review your vendor records and collect missing Forms W-9 securely. Confirm that names, addresses, and taxpayer information are complete.
Have the person responsible for your 1099 filings review payment totals, payment methods, and current reporting requirements. Starting early gives you time to resolve missing information.
6. Review payroll records and liabilities
Compare the payroll recorded in your books with reports from your payroll provider.
Review wages, employer taxes, benefits, and deductions. Investigate payroll liability balances that remain outstanding, including garnishments or other amounts withheld but not yet paid.
Coordinate any corrections with your payroll provider before year-end reporting is finalized.
7. Gather equipment, vehicle, and financing documents
Purchased a work truck, trailer, HVAC equipment, or new tools this year? Gather purchase invoices, financing agreements, and trade-in details.
Include the date each asset was placed in service and applicable mileage records. Your tax preparer can determine the appropriate tax treatment using complete supporting information.
8. Review job profitability
For construction and trades businesses, total revenue tells only part of the story.
Check that materials, labor, subcontractors, permits, and equipment rentals are assigned to the correct jobs. Compare actual costs with estimates and investigate projects with unusually low margins.
This review can help you improve pricing and bids for the coming year.
9. Review your financial reports
Review your profit and loss statement, balance sheet, and statement of cash flows together.
Look for unusual balances, unexpected changes, personal expenses, and unresolved transactions. A profitable year can still leave cash tight when customers pay slowly or loan payments and equipment purchases use available funds.
10. Prepare a complete package for your tax preparer
Organize your finalized financial reports, supporting statements, payroll reports, asset documents, and questions. Coordinate any year-end adjustments with your tax preparer and establish a closing date once the books are finalized.
Need help getting your books ready?
You don’t have to tackle year-end bookkeeping alone.
YMS Bookkeeping Services, Inc. provides bookkeeping cleanup, catch-up work, reconciliations, job costing, and ongoing monthly bookkeeping for construction, HVAC, trades, medical practice, and small businesses throughout Walnut Creek, Contra Costa County, and the San Francisco Bay Area.
We help organize your financial records so you can work with your tax preparer and make informed business decisions.
Let’s get your books working for you. Reach out for a free consultation:
(925) 858-7560
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