As a small business owner trying to focus on making a living, you probably operate with significant time constraints. Such time constraints take away from the necessary supportive tasks like managing your business financials. If there is something you’ve been missing, there’s a chance you haven’t spent adequate time keeping track of your business’ activities. You are not alone! Accounting is one of those functions that people tend to avoid until such time they can’t avoid it any longer.
Now, or in the future, there are reasons why you might want to reconsider not focusing on your business’ accounting function. Some of those reasons might include (but not limited to):
- Wanting to secure a business loan for expansion
- Audit request from the Internal Revenue Service
- The need for a valuation to sell the business
- The desire to bring in a partner
- Nearing the end of your business’ first fiscal year end
If you are interested in formally pulling together your business’ financial records after the fact, dating as far back as necessary, you need to consider retroactive bookkeeping.
Below I will address the process of pulling together retroactive financial records. I will also share why outsourcing this bookkeeping process could be your best option for managing your business financials.
What is Retroactive Bookkeeping?
Let’s assume you have not kept adequate business financial records for at least one year. We can further assume you now have cause to go back and organize your financial records in some meaningful way. That is what business professionals such as myself would call retroactive record keeping or bookkeeping.
To perform such a process with a reasonable degree of accuracy, you would need to pull together past documents. The best after the fact documents would include canceled checks, bank statements, paid invoices, and cash receipts.
From this information, an experienced bookkeeper should be able to reconstruct your business’ activities for as far back as you have the available information. They should be able to record cash transactions, do job costing, reconcile your bank statements, and ultimately create financial statements.
How and Why to Outsource Your Accountancy Needs
Deciding to get your records for past business financials in order can be a daunting task. As you contemplate pulling your business’s past financial records together in some meaningful form, you probably realize you don’t have the time you would need to handle such a task. That’s okay, you should not see this as a big problem. You always have the option to outsource such work to a professional accountant such as myself.
As a professional accountant, I have the expertise and experience to take disorganized records and put them in a logical order. From there, I have the ability to efficiently record all of your company’s business transactions in the relevant general ledger accounts for conversion into financial statements.
Before creating the financial statements you need, a few items need to be completed first. I would need to do all the necessary account reconciliations and perform all job costing tasks. Once all transactions have been recorded, a variety of financial statements and reports are created for your review. The earlier I get in involved in the process, the easier and more cost-effective the process would be.
If you are interested in learning more, I would like to offer you a free consultation. My name is Kimberly Allen, a professional Accountant/Bookkeeper. You can contact me for your free consultation and read about my business at Web site: Kimberly Allen Bookkeeping.