Neglected books aren’t a sign of failure, they’re a sign you’ve been focused on everything else. Growth. Operations. Clients. Bookkeeping is usually the lowest of low on your priority list. But eventually, the lack of bookkeeping will hinder your growth and profitability. And when that happens, getting your books updated can make all the difference between closing your business, being able to get a loan, and finding a way to become profitable.

If this is you, it’s ok. We have all been there. But if you truly want to have a cash flow positive business, it’s time to get your books up to code. I’m Crystal, QuickBooks Certified Bookkeeper and owner of My CFO, and I’ve helped thousands of business owners go from overwhelmed to empowered about their books. You’ve got this. You are smart enough to know how to read/understand your numbers. You are worth raising your prices! 

I’ll guide you through each step on how to start getting your books to a place where you can stop fearing what you do or don’t know.

Step 1: Acknowledge and Assess

Before you decide to stab your eye out with a spoon (yes, I have had a client use that exact phrase with me!), take a deep breath and pause. 

• Take a deep breath and take ownership of where you are. 
• Take a deep breath and acknowledge that you’ve fallen behind. 
• Take a deep breath and decide to move forward and fix what you need to fix.  

Now, take stock of what you have and where you stand. Do you have receipts, invoices, and bank statements? Even if they’re a bit disorganized, they’ll work as your starting point and help you remember where the heck your money went or came from!

Start by gathering all the necessary documents. If you don’t have everything, it’s okay. You don’t need to be perfect, because perfection = procrastination. You just need to start. Even if it’s just the basics, we’re moving forward here by not avoiding just because you don’t have everything! Small steps forward mean you are still moving forward!

Step 2: Start coding your transactions in Your Accounting Software

Start by electronically linking your bank accounts and credit cards in QuickBooks. Once you have done that, it is time to start coding the transactions. In your chart of accounts, use their recommended accounts to start categorizing your expenses and income. If you are a serious business owner, it is crucial you use some sort of accounting software. Spreadsheets are meant for side hustles and hobbies, not businesses with payroll and rent.

Once you’ve got that structure, begin to code everything you can into the appropriate categories. This doesn’t need to be perfect, just get it on the profit and loss statement and balance sheet report so you can get a sense of where things stand. If you’re unsure about certain transactions, note them down for review later.

If you have a full year’s worth of coding to do, schedule two hours a day on your calendar. That way, you are not neglecting your day-to-day operation, but you are starting to tackle the hundreds of transactions.

Step 3: Review Your Reports

Remember, no one’s expecting you to be an accounting wizard. If this feels overwhelming, it is normal. Even for us, certified QuickBooks Bookkeepers, clean-up can be a daunting task! If it becomes too much and you are ready to delegate, let me know – I’d love to help you get your books organized.

Now that you have spent a gazillion hours coding and pulling out your hair, it is time to review your profit and loss and balance sheet reports to see what the numbers look like. First, for your P&L, click on each category. If you coded it correctly, awesome. If you need to change it to a different chart of accounts (COA), click on edit and code it to the correct account. Rinse and repeat for your balance sheet.

Step 4: Implement a System for the Future

Now that you’ve tackled the year’s backlog, let’s make sure this doesn’t happen again. The key to avoiding this financial chaos next year is creating new habits and leveling up your mindset. I recommend reading my book, “The STOP Method™” to help you see that bookkeeping is your secret weapon to success. It is not there to make you feel dumb or broke. It is there to back up your gut feelings.

Step 5: Take a Moment and Celebrate

You did it! You took control of your business bookkeeping, and that’s no small feat. Celebrate this win. You’ve taken a major step toward financial clarity, stability, and even profitability. And remember, consistency is key. When you start to feel like you are slipping with your bookkeeping, assess on if it is time to delegate to elevate. 

If you need help getting started or cleaning up your books, please reach out. We love the chaos of cleaning up your books. We love connecting with you and seeing you go from overwhelmed to empowered. We’re here for you at My CFO, and can guide you through this process so you can get back to doing what you love.

Because when it comes to your business, profit isn’t an accident, it’s a plan. And cash flow isn’t luck, it’s strategy.