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Your Ultimate Bookkeeping Monthly Checklist for Smoother Financial Management


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Two bookkeeping monthly checklist samples on a table.


Looking for a bookkeeping monthly checklist? Need organization or just a general template of the bookkeeping process you can follow?

We’ve got just the thing. In this post, our hope is that you’ll gain a better understanding and a greater confidence regarding your financial upkeep.  

But, why a checklist?


4 Reasons Why a Monthly Bookkeeping Checklist Is Essential

  • Helps ensure you have accurate financial records
  • Helps you stay compliant with tax laws and regulations
  • Helps facilitate informed decision-making
  • Helps prevent financial errors and discrepancies


Preparing for Your Monthly Bookkeeping

Before we get into the checklist, there are some things you might want ready. 


Probably the first thing you need to think about is setting up a dedicated time for bookkeeping. You can set up a monthly bookkeeping schedule, but you can also do it weekly or even on a quarterly basis.

This depends on how much money you make, the volume and complexity of transactions, and other factors like revenue sources. That being said, we find that monthly bookkeeping is generally the most manageable.


Next, you should gather the necessary documents and information. This includes all the receipts, bank and credit card statements, payroll documents, invoices, and others. 

Tools and software can help you streamline this process. We say the earlier you set these up the better. We cannot understate the value of bookkeeping software and tools enough.

Even weekly bookkeeping can be stressful if you don’t have a way to organize your transactions. The ease of accessing your documents and the benefits of automation make investing in cloud-based solutions a no brainer. 

You don’t even have to start with a paid subscription. Several software tools offer free tiers that still offer helpful services. 


Your Bookkeeping Monthly Checklist: A Step-by-Step Guide

A woman writing in a notebook that says, "Goals."


1. Reconcile Bank and Credit Card Statements

The first thing people usually start with involves comparing bank and credit card statements with your records. Some transactions take time to register in bank systems. Sometimes, banks don’t process checks and credit payments right away. This can sometimes lead to discrepancy.

Daily reconciliation is important to ensure your internal records like up with your bank and credit card statements. Once you identify and resolve the discrepancies, you can adjust your balances accordingly. 

A bank reconciliation statement shows the reason for discrepancies and helps prevent issues with financial reporting. 


2. Review and Categorize Transactions

Next, you want to record every transaction. This may involve creating both journal entries and separate ledger entries in their appropriate accounts. This double-entry method helps maintain accuracy. 

After recording, you need to make sure you categorize income and expenses accurately.

These categories help you granulate your expenditures and income sources for better organization. The more broad categories are your main chart of accounts. Companies can then specify their income and expenses based on their needs. For instance, business expenses can be divided into accounts like travel, maintenance, advertising and marketing, etc. 


3. Update Accounts Payable and Receivable

Accounts payable is a liability account and refers to the obligations or debts of a company. These are outstanding invoices and payments that need to be paid out to another company for their products or services. It’s important to indicate when you make these credit payments and update the entries once you meet those obligations.

Accounts receivable is the exact opposite in that it refers to debts and obligations owed to your company. Part of the bookkeeping process is also following up on any overdue accounts so that you can accurately report income and revenue. 

When it comes to recording new invoices and payments, we recommend recording these as they happen. A number of accounting software tools helps with invoicing automation and documentation. 

4. Record Payroll and Employee Expenses


The recording of payroll transactions may not be at the same time as your regular bookkeeping. This depends on what the payment terms are. For instance, are you paying workers a fixed rate or an hourly rate? Are you paying at the end of the month or every 15th day?

Regardless of when and how you record these, the important thing is to have a consistent method. For instance, you can treat payroll due in a similar way as you treat accounts payable. 

Employee Expenses

Sometimes employees may also temporarily pay for a business expense out of pocket and require reimbursement. 

Foreseeing this possibility, you should have a standard procedure that they can follow. An obvious one is for workers to ask for and present receipts to the head of bookkeeping. That way it’s easier to track and record these expenses and corresponding compensations.


A woman counting cash and writing the numbers in a notebook.


5. Review Financial Statements

 The Big Three

  1. Cash Flow Statements – These reveal cash and cash equivalents coming in and going out of a company based on its activities. This includes operating activities, investing activities, and financing activities. 
  2. Income Statements – Also known as profit and loss statements, they reveal how much money your business has spent and earned in a given period. This includes your COGS, gross margins, and of course, the company’s net income. 
  3. Balance Sheets -This financial statement only applies to businesses who use double-entry accounting. The balance sheet reveals how much you owe in liabilities and what others owe you as assets. It also reveals the shareholder equity after deducting liabilities. Its purpose includes revealing how well a company is operating and how able they are to pay short-term obligations. 


Identifying Trends and Potential Issues

Through analyzing these reports and others, you can draw important data and use that to make decisions. 

This includes:

  • identifying areas in need of better budgeting 
  • identifying areas of unnecessary or excess spending
  • identifying discrepancies
  • identifying savings opportunities
  • identifying better investment opportunities  


6. Update Inventory Records

This is part of your bookkeeping monthly checklist that you may not have even considered. But yes, it’s important to keep an updated record of inventory levels and adjust based on sales and purchases as this affects profitability.

By identifying slow-moving or obsolete inventory your bookkeeper can provide actionable insights on where to cut or reallocate expenses. 

Inventory management software is a great tool that helps you track stock levels, automate processes, and track KPIs. Some can even give you inventory reports from data which can help you make decisions that better impact your bottom line.


7. Prepare for Tax Obligations

It’s always a good idea to plan ahead and set aside funds for tax payments. You can do this by taking a percentage of profits every month that you reserve for when tax season rolls around. 

How can you know how much you’ll need? Well, an accountant can help you come up with estimates based on tax codes, deductibles, and by summing up other tax obligations like provisional and sales taxes. 

Another important part of this process is having financials that comply with tax regulations. Preparing for tax season looks like recording any tax-related transactions like payroll tax, income tax, sales tax, etc. 

Additionally, you should  follow the standard procedures for creating and collating information into tax-ready financials. Then, you can hand them over to your accountant for the filing process. 


A woman using a calculator and writing on paper.


8. Review and Adjust Budget

A main part of this process is comparing actuals to budgeted figures. Budget refers to the estimate of your expenses and income by your business within a particular period (usually one year). Actuals refer to the real figures of expenditures and resume. These show how closely you’ve stuck to the budget. 

The next step is making necessary adjustments for the coming month. If your actual figures are far from the forecasted budget, that should be a sign to change things up. This can look like cutting down on expenses or reallocating funds to a particular area of operation.


9. Backup Financial Records

It’s essential to ensure that all financial data is backed up securely. This can look like making multiple copies stored manually, digitally, or both. This can look like using secure cloud storage solutions  or external drives. This may seem redundant but this provides security and assurance that you’ll always have the documents you need. 


Tips for Streamlining Your Monthly Bookkeeping

  • Leverage automation – With the help of AI and setting up automation rules, you can save time on repetitive tasks.  This includes processes like invoicing, restocking, bank reconciliation, categorizing tasks, and creating financial reports. 
  • Be consistent – Maintain accurate  records throughout the month by following accounting standards and best practices, principles, and guidelines. 
  • Seek professional help – Leverage professional bookkeeping services when needed. “Do it yourself “ bookkeeping has its place but it’s helpful to know when professional help makes more sense as you scale. 


Frequently Asked Questions


How long should it take to complete a bookkeeping monthly  checklist?

If you are consistent, it should take a few hours and no more than a day. That is if there aren’t any discrepancies or major issues. 


How can I keep track of all my receipts and invoices efficiently?

Use software or create an organizational system so you can bring them up as needed for bookkeeping, reporting, or audits. 


Is it necessary to review my budget every month?

It’s a good idea to evaluate whether you’re still on track with your budget and making those minor or major corrections as needed.


What are the best tools for automating bookkeeping tasks?

We have several lists of our top accounting and bookkeeping software such as QuickBooks, Xero, and Freshbooks, with built in automations.


What Is AccountsBalance?


AccountsBalance is a monthly bookkeeping service specialized for agencies & SAAS companies.

We take monthly bookkeeping off your plate and deliver you your financial statements by the 15th or 20th of each month.

You’ll have your Profit and Loss Statement, Balance Sheet, and Cash Flow Statement ready for analysis each month so you and your business partners can make better business decisions.

Interested in learning more? Schedule a call with our CEO, Nathan Hirsch.

And here’s some free resources:



In Summary

A bookkeeping monthly checklist is a great way to organize and systematize your financial record-keeping. It doesn’t matter whether you are hands-on with your bookkeeping or not. This can provide valuable knowledge of the process, and importance of these procedures. 

Want help with your bookkeeping? We make it easy. Get startedSpeak w/ a Founder, or Schedule a Callback

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Julia Valdez

Julia Valdez

Julia is a career freelancer and agency owner turned coach for those seeking abundance and victorious living. A professional teacher and decades-long lover of the art of words on paper and the stage, she loves sharing actionable advice on life-changing topics. When she’s not helping freelancers and other small business owners grow, you can find her sharing lots of laughs over little crazy things.

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