Almost every small business owner falls behind on the books at some point. A busy season hits, receipts pile up, and suddenly it's been five months. The good news: catching up is mostly a gathering job, and it goes much faster when you work in the right order.
Step 1: Pick your starting month
Find the last month your books were truly complete. If you've never kept books, start at January of the current year. Everything after that point is your catch-up window.
Related: How to Do Bookkeeping for a Small Business (Start to Finish) · Monthly Bookkeeping Checklist for Small Business (Free Excel Template) · free bookkeeping tools and templates
Step 2: Gather the records
- Bank statements for every business account, one per month (PDF or CSV from online banking)
- Credit card statements used for business
- Payment app history — Venmo, Zelle, Cash App, PayPal, Square
- A list of cash jobs or cash sales you were paid for
- Loan statements and anything you paid helpers or contractors
Step 3: Work oldest month first
Do the months in order. Starting balances carry forward, so jumping around creates mismatches you'll have to untangle later. Each month: record income, categorize expenses, separate transfers and owner draws, then check that the ending balance matches the statement.
Step 4: Don't forget cash
Cash that never hit the bank is the most common gap in catch-up work. Even a rough list — date, customer, amount — is far better than leaving it out, since the IRS expects all income to be recorded.
Step 5: Review the year so far
Once every month is done, look at the profit-and-loss for the year to date. This is the number that tells you how much to set aside for taxes — and whether a quarterly estimated payment is due.
What catch-up bookkeeping costs
Many bookkeepers bill catch-up work separately from monthly service, often per month of backlog or by the hour, so a long backlog can cost more than a year of regular service. Always ask for the catch-up price before you start.
Catching up is a gathering job. Get the statements together and the rest goes quickly.
With a LedgerFast membership ($79/month), catching up this year's earlier months is free. Upload statements for each past month in the portal, add your cash jobs, and we bring the books current and send finished Excel and PDF reports.