Q4 Bookkeeping Tasks in 5 Easy Steps

The fourth quarter (Q4) is the perfect time to get your books in order. Bookkeeping tasks need to be completed because your year-end accounting will set you up for a successful year ahead. If you’re doing your books on your own, be sure to go through the list below to end the year on a good note.

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5 Bookkeeping Tasks That You Need to Complete in Q4

1. Verify That All Months are Reconciled

Your monthly reconciliation can reduce 9% of all fraud cases. If you come to the end of Q4 and realize that you haven’t reconciled your books, you’ll need to go through the tedious task of:

• Verifying every transaction
• Finding missing expenses

If you’re not reconciling your accounts every month, it’s even harder to make accurate, data-backed decisions because you don’t know the true financial health of the business.

It’s always better to reconcile monthly, especially if you’re a startup, where every cent can mean the difference between being financially sound and struggling to keep the lights on. Your reconciliation can identify fraud and errors and will lead to accurate tax reports, too.

You can work on strengthening your monthly reconciliation by automating manual tasks, standardizing processes, segregating responsibilities and having independent reviews performed for an added layer of security that your bookkeeper’s work is accurate.

2. Record All of Your Expenses

If you’re like 99% of small business owners, you pay 19.8% of your income to taxes. Reducing your tax burden is as easy – and as complicated – as logging every last expense that you can. Owners should avoid:

• Paying business expenses personally
• Failing to discuss expenses with their accountant or bookkeeper

Tax rules change often, and if you’re not a tax professional, it’s easy to overlook expenses that you can deduct, such as: vehicle tax, bad debt, retirement plan contributions, education and training, and dozens of others.

Receipts will help strengthen your expense recording, too.

3. Store Your Receipts Properly

Now that you have your expense-recording on track, it’s time to look at your receipts. How are you storing them?

If you’re not already, it’s time to start creating digital copies of your receipts. Digital files are easier to store and organize. Paper receipts can easily get lost or damaged.

Q4 is a great time to get into the habit of storing your receipts properly going forward, so you can easily link transactions together in case of an audit.

4. Review Your Payroll Liabilities

It’s easy to forget that payroll isn’t a set-it-and-forget-it system. You should be reviewing your payroll liabilities regularly to ensure you’re still on track. The fourth quarter is a great time for this review.

Take the time to:

• Check your payroll statements to ensure that you’re up to date on paying withheld taxes.
• Review outstanding employee wages. Have all direct deposits gone through? Are any checks left outstanding?

Reviewing payroll liabilities can be tedious and complex. An accountant can handle this task for you, so you can focus on more important things.

5. Make a Plan for Q1

Q4 is the perfect time to start looking ahead to next year and your plans for the first quarter. Goal-setting is an important part of running a successful business. With clear objectives, you can steer your company and your team forward with confidence.

What do you want to achieve in Q1? Do you want to:

• Boost brand awareness?
• Improve customer retention?
• Increase sales, subscribers or clients by a certain amount? 

Now is also a great time to review your marketing strategies to see where you can make improvements and:

• Identify non-core tasks that you can outsource or delegate to improve efficiency
• Find bottlenecks in your processes and solutions to overcome them

Every business is unique, so no two Q1 plans will look the same. However, if you have big goals for the next year, consider breaking them down into smaller goals that can be achieved in a shorter period of time.

These can be repetitive groups of tasks that are reviewed regularly or one-time projects that add up to helping you achieve a bigger goal. 

While you’re looking toward the future, make sure that you also start preparing for the Q1 accounting tasks you’ll need to complete.

Final Thoughts

These are some of the most important bookkeeping tasks to focus on in the fourth quarter. If you’re not already, it’s highly recommended that you work with an experienced accountant to ensure you’re not missing anything, especially when it comes to compliance.

To learn more about our virtual bookkeeping services or how we can help you with your accounting needs, schedule a consultation now!