Month-end is where bookkeeping either stays easy or starts to slide. Skip a month and next month takes twice as long; skip three and you’re looking at a catch-up project.
This checklist is the monthly routine I follow, written for owners who do their own books. It assumes you use accounting software like QuickBooks Online, but the steps are the same on a spreadsheet.
Before you start: set up for an easy month-end
Month-end goes faster when the month itself is organized. Three habits make the biggest difference:
- Connect bank feeds. Transactions flow into your software automatically, so month-end is checking, not typing.
- Use bank rules. Routine transactions, like your phone bill or software subscriptions, can be categorized automatically.
- Capture receipts as you go. Snap a photo at the till instead of hunting for paper at the end of the month.
Step 1
Gather the month’s statements
Download statements for every business bank account, credit card and loan once the month closes. Bank feeds are convenient, but the statement is what you reconcile against.
Step 2
Enter and categorize every transaction
Make sure every transaction for the month is in the books and in the right category. Watch for the usual troublemakers: owner draws recorded as expenses, transfers between your own accounts recorded as income, and anything sitting in “uncategorized.”
Step 3
Reconcile every bank and credit card account
Match your books to each statement, line by line, until the ending balances agree. If something doesn’t match, find out why before moving on; it’s far easier to find a problem this month than next year.
Step 4
Match your receipts
Make sure each purchase has its receipt or bill attached or filed. A receipt app (like Dext, which sends receipts and bills to QuickBooks) makes this a two-second job at the time of purchase.
It matters for GST: you need supporting documents to claim back the GST you paid, and the CRA expects more detail on bigger purchases. From $100, that includes the supplier’s GST registration number.
Step 5
Review what you owe
Look at your unpaid bills (accounts payable). Are they all entered? Is anything overdue? Compare supplier statements to your records so you don’t pay twice or miss a credit.
Step 6
Review who owes you
Run your accounts receivable report. Which invoices are overdue, and by how long? Decide who gets a reminder this week. Money you’ve earned but haven’t collected is the easiest cash flow problem to fix.
Step 7
Check payroll and remittances
If you have employees, confirm every pay run is recorded and your CRA remittance is on schedule. Most small employers, including most new ones, remit by the 15th of the month after payday (some very small employers remit quarterly instead), and late remittances are penalized starting at 3%.
Step 8
Check your GST
Compare the GST you’ve collected with the GST you’ve paid, and make sure the balance owing is set aside. If your reporting period ends this month, the return is generally due one month later (for monthly and quarterly filers).
Step 9
Read your reports
Run your profit and loss statement and balance sheet. You don’t need to analyze them for an hour, just ask a few questions: Did anything jump compared with last month? Does the bank balance on the balance sheet match your actual bank? Is there anything you don’t recognize?
Step 10
File it away
Save the statements, reports and receipts for the month somewhere you can find them. The CRA generally expects business records to be kept for six years after the end of the tax year they relate to, so a tidy folder now saves a scramble later.
Rather hand this list to someone else? That’s monthly bookkeeping: I run this routine for you every month and send you a plain-English summary. And if you’re already a few months behind, start with catch-up bookkeeping.
Common month-end mistakes
Most month-end problems come from skipping a step, not doing it wrong:
- Reconciling against the bank feed instead of the actual statement
- Leaving transactions in “uncategorized” to deal with later (later rarely comes)
- Recording a transfer between your own accounts as income or an expense
- Forgetting the credit card, because it isn’t a bank account
- Not looking at the reports, so a problem sits unnoticed for months
Can I do this quarterly instead?
You can, but it rarely saves time. Three months of transactions take longer than three single months, mistakes are harder to trace, and you only find out about a problem long after you could have fixed it. If your GST or payroll is monthly anyway, monthly bookkeeping fits naturally around it.