December is when loose ends in the books turn into questions from your CPA. A charge nobody can explain, a bank account that hasn’t been reconciled since summer, a contractor with no W-9 on file: each one takes less time to fix now than in March.
This year-end bookkeeping checklist is the one we work through with clients, in the order we do it.
The short answer: a year-end close has three parts. Before December 31, reconcile every account, clear uncategorized transactions, collect W-9s, and check loans and unpaid invoices. In January, reconcile December, match payroll, confirm 1099 amounts, and review the year’s reports. Then send your CPA what they ask for, and lock the year.
The year-end closing steps, in order
- Reconcile every bank account, credit card, and loan through November.
- Clear uncategorized transactions and anything marked “Ask My Accountant”.
- Separate personal spending from business spending.
- Collect a W-9 from every contractor you paid.
- Review unpaid invoices and unpaid bills.
- In January, reconcile December and match payroll to your provider’s reports.
- Review the year’s profit and loss and balance sheet.
- Send your CPA their list, then lock the year with a closing date.
The rest of this post walks through each part.
The year so far
days left in the year
Everything on the first list below can be done before December 31.
Before December 31
0 of 8 done
In the first weeks of January
0 of 5 done
What to hand your CPA
Every CPA has their own list, so ask for theirs early. Most will want the year’s profit and loss and balance sheet, the December bank and loan statements, the payroll provider’s year-end reports, a list of contractors and what each was paid, and the paperwork for any equipment or vehicles you bought. Our post on what your CPA needs at year-end goes item by item.
The year-end problems we see most
When we take a first look at a company’s books at the end of the year, the same few problems come up again and again:
0 of 5 apply to you
None of these is unusual, and all of them can be fixed. It takes careful work, entry by entry, which is why starting in November matters.
When to bring in help
If the books are more than a couple of months behind, a checklist won’t be enough. That is a catch-up project, and it is better started in November than in March. Our catch-up plan shows how it works, oldest month first.
How Larsen Bookkeeping handles year-end
For our monthly bookkeeping clients, most of this list happens every month: every account reconciled, every transaction checked, and reports reviewed with you. Year-end is then a careful review of work already done, followed by books ready for your CPA.
Frequently asked questions
Reconcile every account, clear uncategorized transactions, separate personal and business spending, collect W-9s, review unpaid invoices and bills, reconcile December in January, match payroll, review the year’s reports, send your CPA their list, and lock the year with a closing date.
In November. Reconciling through November and clearing the review pile before the holidays leaves only December for January.
Yes. Your CPA works from your books. The cleaner they are, the fewer questions come back, and the less time your CPA has to spend untangling them.
Software can sort routine transactions, but it can’t tell you what is missing or whether a deposit was a loan or a sale. Our post on AI bookkeeping explains where a person still matters.
Start with a conversation. We scope the cleanup first, oldest month first, as the start of monthly bookkeeping.
Start with a conversation
If you’re a Massachusetts business owner and you’d like your books ready for your CPA this year, request a free consultation. Prefer to call? 781-924-1489.