The small-business bookkeeping checklist
A month-by-month checklist to keep your books audit-ready without the year-end scramble, and a clear line between what you handle and what your bookkeeper should.
Most small-business owners do their bookkeeping twice: a little bit all year, and then all of it in a panic before the year-end deadline. The second pass is where money is lost: not in fees, but in deductions nobody can substantiate eleven months later.
This checklist is what we run on client files internally. It is organised by when things actually need doing rather than by account type, because that is the only version anyone follows.
Why monthly beats annual
A set of books closed monthly is useful; a set closed annually is only compliant. The difference matters in three concrete ways.
- 01Receipts are still findable. A missing $400 invoice is a two-minute fix in week one and a lost deduction by December.
- 02You can act on the numbers. Knowing your margin slipped in April is worth something in May. It is worth nothing the following February.
- 03Errors stay small. A mis-coded recurring expense caught in month one is one entry. Caught at year-end it is twelve, plus a restated prior period.
"Nearly every expensive year-end we have cleaned up started as three months of unreconciled bank feeds."
The monthly checklist
Work through these in order. The sequence matters: reconciling before your receipts are in means doing it twice.
Do not start with the oldest month. Close the most recent complete month first so you have one clean period to compare against, then work backwards. Cleaning up chronologically means you see nothing useful until you are finished.
Quarterly items
Four things are worth doing on a quarterly cycle rather than monthly: often enough to catch problems, rarely enough that they do not become busywork.
- 01GST/HST filing and remittance, if you are on a quarterly reporting period.
- 02Corporate instalment review. Under- and over-paying both cost you; the former in interest, the latter in cash flow.
- 03Payroll remittance reconciliation against what CRA has on record for you.
- 04A full read of the file by someone who did not enter the transactions.
What to leave to your bookkeeper
The split above is deliberate. There are four tasks owners routinely take on that reliably cost more time than they save.
- 01Chart of accounts changes. Adding accounts ad hoc is the single most common cause of unusable year-over-year comparisons.
- 02Accruals and prepaids. Easy to get directionally wrong in a way that flatters one month and punishes the next.
- 03Payroll journal entries. Remittance timing rarely matches pay-period timing, and the correction is fiddly.
- 04Anything involving CRA correspondence. Reply deadlines are shorter than most owners expect.
Common mistakes
Three patterns account for most of the cleanup work we take on from new clients.
Treating the bank balance as the number
Your bank balance is not your profit and it is not your cash position. It does not know about the payables due Friday or the GST you are holding. Read the balance sheet alongside the P&L, always.
Mixing personal and business spending
A separate card is not a formality. Untangling commingled transactions is the most expensive routine work in bookkeeping, and it is entirely avoidable.
Filing on time but reconciling late
Filing a return from unreconciled books means filing a number you will later have to amend. On-time and correct are different goals.
- →Close every month by the tenth. The books are then usable, not just compliant.
- →Your jobs are receipts, feeds, and coding answers. Everything else belongs to your bookkeeper.
- →If you are behind, close the most recent month first and work backwards.
- →Read your reports against the same month last year, not against last month.
Related guides.
T2125 basics for self-employed owners
What goes where on the form, and the deadlines that apply to you.Building a 13-week cash flow forecast
The rolling forecast worth building before a slow season.GST/HST for first-time filers in BC
When to register, how often to file, and the credits owners miss.
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Bookkeeping, payroll, and tax for Canadian small businesses. Vancouver, BC. Serving clients across Canada.