QuickBooks Online Cleanup Projects in 2025: The Ultimate Guide for SMBs and New Bookkeepers

Cleaning up a messy QuickBooks Online (QBO) file can feel daunting, especially for new bookkeepers or busy small business owners. This ultimate guide breaks down everything you need to know about QuickBooks cleanup projects in 2025 – from what a cleanup involves and why it’s vital, to common problems to watch for, the latest QBO features that can help, a step-by-step cleanup workflow, real-world case studies, and tips on when to clean up versus start fresh. We’ll also include “Owner Impact” callouts in plain language, explaining why each issue matters to your business. Let’s dive in!

What Is a QuickBooks Cleanup and Why Is It Vital?

In a bookkeeping context, a QuickBooks cleanup is a thorough review and correction of a company’s financial records to fix errors and bring the books fully up-to-date and tax-ready. It’s more than just tidying up – it’s about transforming inaccurate, cluttered books into reliable financial statements you can use with confidence. Think of it as forensic bookkeeping: you investigate what went wrong, fix past mistakes (like missing entries or duplicates), and ensure every account balance is accurate. By the end of a cleanup, bank balances in QBO match the real bank statements, invoices and bills are properly recorded, and your financial reports make sense for decision-making.

Why is this vital? Messy books happen for many reasons – maybe a well-meaning owner or inexperienced bookkeeper made incorrect entries, or perhaps the books were neglected for months. Over time, these errors snowball into unreliable financial data. A successful cleanup ensures compliance and clarity: it can reveal the true cash flow, prevent nasty tax surprises, and empower business owners with accurate numbers. In short, a cleanup “tames the clutter” and puts you back in control of your finances.

Owner Impact: If your books are messy, you could be overpaying (or underpaying) taxes, misunderstanding your true profit, or missing red flags in cash flow. Cleaning up ensures you’re making decisions based on facts, not faulty figures.

Cleanup vs. Catch-Up Bookkeeping: What’s the Difference?

It’s important to distinguish a cleanup from catch-up bookkeeping, as the two often go hand-in-hand. Catch-up means entering months’ or years’ worth of transactions that were never recorded (bringing the books current). Cleanup means fixing or reconciling data that is in the books but is inaccurate or disorganized. In practice, many projects involve both – for example, if a client hasn’t done any bookkeeping for 6 months, you need to enter those 6 months of missing transactions (catch-up) and then correct and reconcile everything (cleanup). The key difference is catch-up is about entering data that’s missing, whereas cleanup is about correcting existing data (and usually reconciling accounts and resolving errors).

To illustrate: if your QBO file has gaps where no expenses were recorded for several months, that’s a catch-up job to input them. If your file has all transactions entered but many are categorized wrong or not reconciled to bank statements, that’s a cleanup job. Often, you’ll do both together to get books in order.

Common QuickBooks Cleanup Problems in 2025

Even in 2025, the same bookkeeping blunders continue to plague many QuickBooks Online files. Let’s highlight the most common cleanup problems and why they matter. These are issues you’ll likely encounter – and need to fix – during a cleanup project:

Undeposited Funds Piling Up

Undeposited Funds is a special account in QBO that acts as a holding area for incoming payments that have been recorded but not yet deposited in the bank (in the software). It’s meant to temporarily hold payments (from invoices, sales receipts, etc.) until you group them into a bank deposit in QBO. However, many messy QBO files end up with a huge, lingering balance in Undeposited Funds due to improper workflow. This typically happens if someone received customer payments in QBO but never completed the “Make Deposits” step, or if bank deposits were recorded separately without matching to those payments. The result is money stuck in Undeposited Funds that should have been cleared out.

During cleanup, you’ll likely find old transactions sitting in Undeposited Funds that were never matched to a bank deposit or were duplicated. For example, you might see customer payments from last year still in Undeposited Funds because they were never properly deposited in QBO. In one case study, a business had $3,000 in Undeposited Funds from two customer payments that were recorded but never cleared; in fact, one had been deposited to the bank and also entered as a separate deposit in QBO, causing income to be counted twice. As part of the cleanup, we matched or recorded those payments into actual deposits and eliminated the duplicate entry, bringing Undeposited Funds back to $0.

Owner Impact: Undeposited Funds issues can overstate your income or leave revenue unaccounted. For example, you might unknowingly count the same payment twice or, conversely, not realize some payments never got recorded in your bank register. This means you could pay taxes on income you didn’t actually receive or be misled about your cash balance. Clearing out Undeposited Funds gives you an accurate picture of cash and revenue.

Misapplied or Unapplied Customer Payments

Another common cleanup problem is misapplied payments in Accounts Receivable. This occurs when customer payments are not properly linked to the invoices they belong to, or when payments are recorded to the wrong customer or left “unapplied.” The symptoms include open invoices that you know were paid, negative accounts receivable, or credits sitting unapplied. For instance, an invoice might show as unpaid in QBO because the payment was recorded as a generic deposit or to the wrong customer, rather than being applied to that invoice.

During a cleanup, you should run an A/R Aging report and investigate any old or unusual balances. It’s common to find that some customers have credits or unapplied payments that need to be matched to open invoices. For example, in one cleanup we discovered five overdue invoices totaling $10,000 on the books. On investigation, one $4,000 invoice had actually been paid by the customer – the owner had received the money and even deposited it, but never recorded that payment against the invoice in QBO. We recorded the payment in QBO and applied it to the invoice, instantly closing that invoice. Two other invoices were legitimately uncollectible, so we wrote them off as bad debt using credit memos. Another invoice was a duplicate entry, which we deleted. After these fixes, the accounts receivable was clean – only genuine, still-unpaid invoices remained (in our case, just one invoice for ~$2k).

Owner Impact: Misapplied or unrecorded payments mean your books might be showing that customers owe you money when they don’t. This can lead to embarrassing situations like chasing a client for payment they already made, or it can inflate your expected income erroneously. Cleaning this up ensures you know exactly who really owes you (and who doesn’t), so your receivables and income aren’t overstated and you maintain good customer relationships.

Incorrect or Messy Chart of Accounts

Many cleanup projects involve untangling an incorrect chart of accounts. This includes things like duplicate accounts, miscategorized transactions, or simply a chart of accounts that doesn’t make sense for the business. For example, a small business might have dozens of expense accounts – some created accidentally – leading to confusion and inconsistent bookkeeping. Or perhaps transactions were posted to obviously wrong accounts (e.g. loan payments recorded entirely to an expense account, or personal expenses mixed into business accounts).

A cleanup typically involves reviewing the chart of accounts for accuracy and simplicity. You may need to merge duplicate accounts, deactivate ones that aren’t used, and reclassify transactions into their proper accounts. In one instance, we found the client had separate expense accounts for “Telephone” and “Internet” even though they should have just one Utilities account; it turned out one was added by a prior bookkeeper. We merged them to streamline the chart. We also found some expense transactions that were actually personal (non-business) charges – for example, a personal vacation charged to “Travel Expense.” We reclassified those to an Owner Draw account to keep the business expenses accurate. Additionally, as part of cleanup you ensure there are no weird balances in accounts like “Ask My Accountant” or Uncategorized Income/Expense – these should be zero once you’ve properly categorized everything.

Owner Impact: Using the wrong accounts or having a messy chart of accounts will distort your financial reports. You might be understating or overstating certain expenses (impacting your tax deductions and profit) simply because things were misclassified. It also makes it hard to analyze your business – for example, if half your internet bills went to “Utilities” and half to “Ask My Accountant,” you won’t know your true spend. A cleanup fixes these so that your Profit & Loss and Balance Sheet are organized and accurate, giving you clarity on where your money is coming from and going.

Unreconciled Bank and Credit Card Accounts

Bank reconciliation is a cornerstone of bookkeeping, yet it’s frequently neglected. If bank and credit card accounts in QuickBooks are not fully reconciled – meaning the transactions in QBO don’t match the actual bank statements – you’ll almost certainly have errors in the books. Unreconciled accounts often hide duplicate entries or missing transactions. For example, you might have a situation where a $2,000 check was never entered in QBO (so the bank shows it cleared, but your books don’t have it as an expense), and perhaps a deposit was entered twice in QBO (so your books show more money than the bank did). These kinds of discrepancies are exactly what reconciliation is designed to catch.

As part of any cleanup, you must reconcile all bank, credit card, and loan accounts for the period in question. Often we discover surprises: in one case, during reconciliation we found a missing check that the client wrote (it wasn’t recorded in QBO at all, so we added it) and a duplicate deposit in QBO that never actually happened according to the bank (so we deleted the extra entry). We methodically reconciled month by month, fixing issues as we went, until the books’ cash balance matched the real bank balance to the penny. We also reviewed the reconciliation reports for uncleared items – old checks or deposits still marked as pending. Several checks from two years prior were still “uncleared” in QBO even though the vendor had long since been paid otherwise; after confirming they were never cashed, we voided those stale checks per best practice.

Owner Impact: If your bank accounts aren’t reconciled, your books are not trustable. You may think you have more cash than you really do or vice versa. Missing expenses mean your profit is overstated (and you’ll pay more tax than necessary), while duplicate income entries do the same. Unreconciled accounts can also mean hidden errors that might bite you later (like discovering a year later that a payment was never recorded and you owe a vendor money). A cleanup reconciliation gives you confidence that your recorded bank balance equals your actual bank balance – no surprises.

Integration Errors from Shopify, Square, PayPal, etc.

In 2025, many small businesses connect QuickBooks Online with third-party apps – e-commerce platforms like Shopify or Etsy, payment processors like PayPal and Square, POS systems, and more. These integrations save time when used correctly, but if set up improperly they can wreak havoc on your books. Common integration errors include duplicate sales entries, incorrect handling of fees, and transactions recorded in the wrong accounts.

For example, consider an online sale processed through Shopify and paid via PayPal: it’s possible to end up with both a Shopify-generated sales receipt and a PayPal deposit for the same transaction. Without proper setup (like using a clearing account or matching deposits), you might inadvertently count the income twice – once from each app. We’ve seen charts of accounts cluttered with accounts like “Shopify Payouts” or “Square Deposits” and a bunch of uncategorized entries from integrations. Oftentimes, funds from sales sit in a clearing or Undeposited Funds account because the software imported them but they were never matched to the bank deposits.

During cleanup, it’s important to identify which apps are connected to QBO and trace how their data flows. You may need to reconcile the app’s records to QBO’s records. For instance, for PayPal, you’d reconcile the PayPal balance in QBO to PayPal’s own statements to ensure every transaction is accounted for. If duplicate entries are found, decide which source of truth to keep – sometimes the detailed sales from Shopify are kept and the duplicate bank deposit entry removed, or vice versa, to avoid double-counting. You might also discover that integration “errors” caused money to sit in the wrong account. In one cleanup, we found customer payments recorded via a PayPal integration were never applied to the corresponding QBO invoices, leaving those invoices open while the bank showed the deposits. We resolved it by recording the payments properly in QBO (or matching them) and clearing out the fake duplicates.

Finally, part of cleanup is fixing the pipeline: if the integration settings were wrong, you should adjust them to prevent repeat issues. For example, maybe Shopify was creating individual sales receipts for every order and also a deposit – you might switch it to summary deposits or ensure only one source records the sale to avoid duplication.

Owner Impact: Integration glitches can dramatically skew your financials. You might overstate your revenue (paying tax on sales twice) or understate expenses (e.g., forgetting to record payment processing fees). Your books could show a big income number that’s not real, or inventory quantities that are off. By cleaning these up, you make sure you’re not paying extra taxes or thinking you’re more profitable than reality. Plus, you’ll be able to trust your sales and margin reports from QBO after resolving integration errors.

The Latest QuickBooks Online 2025 Features to Help with Cleanups

The good news is QuickBooks Online has introduced several new features and improvements by 2025 that make cleanup and bookkeeping easier. Being aware of these can save you time and help prevent future messes:

• AI-Powered Categorization & Reconciliation: QuickBooks is increasingly leveraging artificial intelligence to streamline bookkeeping tasks. The new Intuit Assist “Accounting Agent” in 2025 can automatically categorize transactions, suggest matches, and even help reconcile books by detecting anomaliesquickbooks.intuit.comfirmofthefuture.com. In the latest QBO banking page, you’ll notice an icon for “Suggested by AI” on transactions – QuickBooks will suggest how to categorize or match a bank transaction if it’s confident, based on your past behavior and other businesses’ trendsquickbooks.intuit.comquickbooks.intuit.com. This is especially helpful during a cleanup catch-up phase: as you work through a large backlog of bank feed items, QBO might auto-select likely matches, avoiding duplicates and speeding up reconciliation. Moreover, QBO’s AI-powered reconciliation feature allows you to upload a PDF of your bank statement and have QBO perform a three-way match between the statement, the bank feed, and your books to highlight any discrepanciesfirmofthefuture.com. This can drastically reduce the time spent hunting down differences when reconciling many months of data.

• Business Insights Feed: QuickBooks Online’s new interface includes a Business Feed (also called the Business Insights feed) that summarizes work done by the system’s automation (AI agents) and alerts you to important insightsquickbooks.intuit.comfirmofthefuture.com. Think of it as a smart to-do list or news feed for your books – it might highlight that “$X of transactions were auto-categorized and ready for review” or show trends like “this month’s expenses are 20% higher than usual” using AI-powered analysisfirmofthefuture.com. For a bookkeeper or owner cleaning up books, this feed provides at-a-glance info on what’s been handled automatically and what needs attention (so you don’t overlook something an AI did that might need your approval). It essentially surfaces anomalies or tasks, which is very useful in a cleanup where lots of changes are happening.

• Bookkeeping Review (Month-End Review) Tool: QBO Accountant users have access to the Books Review (formerly Month-End Review) tool, which is a lifesaver for cleanup and ongoing maintenance. This tool puts a structured process in place: it has tabs or checklists for Transaction Review, Account Reconciliation, and Final Reviewinsightfulaccountant.com. It automatically flags things like uncategorized transactions, unreconciled accounts, and anomalies each period. For example, from the Accountant dashboard you can see if any client’s books have unresolved transactions or unreconciled months at a glanceinsightfulaccountant.com. During a cleanup, you can use this feature to systematically go through each issue: reclassify transactions in batch (there’s a Reclassify tool for accountants), ensure each account gets reconciled, and run the final reports to mark the period as closed. Essentially, Bookkeeping Review serves as a cleanup checklist built into QBO – it helps make sure you don’t miss common problem areas. (Note: This feature is available when using QuickBooks Online Accountant – a special edition for accounting professionals. Business owners can invite their accountant or bookkeeper to use it. The clients themselves won’t see the internal checklist, but they benefit from the thorough process it enforcesinsightfulaccountant.com.)

• New Navigation Layout in 2025: QuickBooks Online underwent a significant interface update in late 2025 to a more modern, streamlined design. The navigation menu and dashboard got a facelift to make tools easier to find and use. For example, Accountants now have a customizable toolbar (“My Menu”) for quick access to their most-used toolsfirmofthefuture.com, and the left-side menu uses a tabbed layout for things like Bookkeeping, Payroll, and Sales. The new layout doesn’t fundamentally change how cleanup tasks are done, but be aware that some menu paths have moved. (During the rollout, users could opt in or out of the new interface temporarilyfirmofthefuture.com, but by the end of 2025 everyone will be on the new experience.) For instance, to access the Reconcile screen now, you might go through the Bookkeeping or Accounting tab, and the Business Insights feed is on the new dashboard. The interface is cleaner and more intuitivequickbooks.intuit.comquickbooks.intuit.com – this means less clicking around during your cleanup project and a shorter learning curve for new bookkeepers. QuickBooks provided FAQs and tutorials to help users adapt, emphasizing that while the look is new, the core workflows (like how to reconcile or record transactions) remain the samequickbooks.intuit.com.

• Other Notable Improvements: Intuit is continuously rolling out enhancements that indirectly help with cleanup projects. One example is the ability to extract transactions from uploaded receipts or statements. QBO’s bank feed can now directly accept PDF bank statements or images and pull out transaction datafirmofthefuture.com – great if you have to enter months of missing data from statements. There’s also an anomaly detection feature (part of the AI “Accounting Agent”) that flags unusual changes period-over-periodfirmofthefuture.com. That means if, say, one expense category spikes abnormally or an account balance changes drastically, QBO will alert you – a handy way to catch things that might need investigation during a cleanup.

• QuickBooks Live Cleanup: If you’re a small business owner overwhelmed by a backlog of bookkeeping, Intuit now even offers a one-time QuickBooks Live Cleanup service where a certified bookkeeper will clean up your books for a flat feeone8solutions.com. (For example, at the time of writing, cleanup for last year was around $800 flat, and current-year cleanups could be done for a monthly fee until caught upone8solutions.com.) This might be an option to consider if your books are extremely messy and you don’t have an in-house bookkeeper – the Live Cleanup team can handle getting things tax-ready within about 30 daysone8solutions.com. However, if you’re reading this guide, you’re likely aiming to do it yourself or improve your own skills – so just know this service exists as a safety net.

In summary, QuickBooks Online in 2025 is smarter and more automation-powered than ever. While a cleanup project still requires careful human review, you have new tools at your disposal to help you catch up faster and avoid certain errors in the first place. Next, let’s walk through a detailed step-by-step workflow for tackling a QBO cleanup project.

Step-by-Step QuickBooks Cleanup Workflow

Every cleanup project will have its nuances, but following a structured workflow ensures you cover all bases. Below is a detailed step-by-step approach, from the initial diagnosis of the messy file all the way to final reports and preventing future issues. Use this as a roadmap for your cleanup project:

1. Initial Discovery and Diagnostic Review

Start with a high-level assessment of the books. Before diving into fixes, you need to understand the scope of the mess. In practice, many professional bookkeepers perform a Diagnostic Review – essentially an audit of the QuickBooks file – as the first phase. During this discovery stage, you should:

• Consult with the owner: Ask questions about what period is messy and why. Did they stop doing bookkeeping at a certain point? Were there any major events (like switching banks, changing sales platforms, etc.)? Do they suspect any specific problems? This conversation can give clues (e.g., “I connected Shopify and everything went haywire after April” or “I haven’t reconciled in over a year”).

• View key financial reports: Run a Balance Sheet and Profit & Loss for the period or year in question. Look for obvious red flags: negative asset or liability balances that shouldn’t be negative, large suspense or “Ask My Accountant” balances, an Undeposited Funds balance that seems high, retained earnings that changed unexpectedly, etc. For example, if the Balance Sheet at last year-end doesn’t match what was reported on the tax return, note that discrepancy. In one case, we saw the QBO Balance Sheet cash was $5,000 higher than the tax return showed – a sign that some expenses weren’t recorded in QBO even though the CPA accounted for them on the tax return. That told us an opening balance adjustment would be needed.

• Check reconciliation status: Go to the Reconcile screen for each bank and credit account. QBO will show you the last reconciled date. If you see that the last reconciliation was a long time ago (or never), you know you have catch-up work to do. For example, you might find “Last reconciled: over a year ago” – we encountered that with a client who had sporadic bookkeeping; nothing had been reconciled for 18 months. Make a note of how many months of statements you’ll need to reconcile.

• Scan the Accounts Receivable and Accounts Payable: Run an A/R Aging and A/P Aging summary. Look for old invoices or bills. Are there big amounts that are 90+ days old? Any negative values or obvious errors (like an invoice from 2019 still unpaid – is it really unpaid or just never cleaned up)? Jot these findings down.

• Identify integrations or external systems: Ask or look for evidence of connected apps (PayPal accounts in the chart, Clearing accounts for Square, etc.). Knowing what external data flows you might have to deal with will shape your plan.

• Note any payroll issues: Is there a Payroll Liabilities balance on the Balance Sheet? If yes, are those taxes really owed or is it leftover data? If the client uses an external payroll service (ADP, Gusto, etc.), likely nothing was booked in QBO beyond maybe journal entries – check if those were done or not.

By the end of this diagnostic phase, you should have a checklist of issues observed – for example: Undeposited Funds shows $10k from last year, bank accounts unreconciled for 12 months, A/R has some very old invoices, etc. Share this assessment with the client (if you’re a bookkeeper for hire) along with a plan. Often, this is when you’ll decide if the file is salvageable or if it might be better to start a new QBO file (we’ll cover tips on that decision later). But in most cases, a thorough cleanup is doable.

Tip: Some bookkeepers charge a separate fee for this diagnostic review and then provide a cleanup plan and quote. Even if you’re doing it for your own business, treating discovery as a distinct step will help you stay organized. Essentially, you’re mapping out the puzzle before trying to solve it.

2. Document Collection (Getting Your Records in Order)

Once you know what needs fixing, gather all the source documents and information required to actually perform the cleanup. You can’t reconcile or verify transactions without the records. Key documents and data include:

• Bank Statements for all bank accounts – for every month that needs reconciliation or review. If 18 months are unreconciled, get 18 months of statements (PDF or paper). Don’t forget PayPal or Square statements if those act like bank accounts.

• Credit Card Statements – again, all months in the scope of cleanup.

• Loan statements or amortization schedules for any loans/notes payable on the books (to confirm balances and interest split).

• Previous Tax Returns or Financial Statements – If you have a corporate tax return (Form 1120/1065) or Schedule C from the last year that was filed, get it. The tax return’s balance sheet (if applicable) can serve as a reference for prior year ending balances. Part of cleanup might involve aligning the QBO records to what was reported to the IRS, or at least understanding differences.

• Payroll reports from the payroll provider for the year(s) in question – to record payroll entries if not done and to verify any payroll liabilities.

• Invoices and bills documentation – you may need to see copies of large invoices or bills if you’re unsure whether they’re legitimate or duplicates. Often, though, you can get by with just what’s in QBO and asking the client about questionable items.

• A list of significant transactions or events – for example, ask the owner: “Did you purchase any big assets? Take out new loans? Make any big personal cash infusions or withdrawals from the business?” These often show up in books in confusing ways, so knowing them helps (e.g., an owner contribution might have been booked as income by mistake).

• Access to QBO and relevant apps – make sure you have accountant access to the QBO file (with permissions to undo reconciliations if needed). If apps like Shopify are involved, you might want viewer access to those or at least exported reports from them.

During cleanup, you might discover you’re missing something – say, a bank statement page – so document collection can be iterative. But starting with a complete paper trail will save you headaches.

For instance, in our Modern Global example, once we engaged the client we requested all bank statements for Jan–Dec 2024 and a copy of the 2023 tax return upfront. Having those on hand made the reconciliation and tie-out steps much smoother. We also made a backup of the QBO data (you can export a Trial Balance or use QBO’s backup if available) just in case, before making major changes.

3. Account Reconciliation – Catching Up the Bank & Credit Cards

Now the real hands-on work begins. Reconciliations are the core of any cleanup because they ensure that the transactions in QBO match the real-world transactions that occurred. Given that many errors manifest as unreconciled differences, tackling this early yields big results. In fact, focusing on reconciling bank and credit card accounts often resolves the majority of transaction issues in a messy file.

Here’s how to approach cleanup reconciliations:

• Set a clear starting point: If the account has never been reconciled or the last reconciliation was ages ago, decide whether you’ll reconcile from the last known good point or from scratch. Often, it’s best to start from the beginning of the year (or the earliest period that matters for taxes/financials going forward). For example, if 2023 was never reconciled and we are cleaning up 2024, you might need to reconcile all of 2023 and 2024. Alternatively, if 2022 was fine and 2023-2024 are messy, you might start 1/1/2023 with the bank’s balance as per 12/31/2022 statement (this may require an adjusting entry to correct the opening balance in QBO).

• Reconcile month by month: It’s tempting to do one giant reconciliation for the whole period, but using QBO’s month-by-month reconciliation process is safer. Start with the oldest month that’s unreconciled. Enter the statement’s ending balance and ending date, then check off matching transactions in QBO until the difference is zero. In a messy file, you will not immediately balance – expect differences. Investigate those differences:

  • If transactions are missing in QBO that appear on the statement (common for expenses paid or deposits made that were never recorded), you’ll need to add them. For instance, you might notice a payment to a vendor on the bank statement that is nowhere in QBO. Enter it (with correct date, amount, payee, and account). Then mark it as cleared.

  • If transactions are extra or duplicated in QBO that aren’t on the statement, you’ll need to delete or exclude them. For example, QBO might have two identical deposits on May 15 but the bank statement shows only one – likely someone entered it twice by mistake. Determine which entry is the duplicate and delete it (or move it to a suspense account temporarily if you’re unsure, but usually deletion is fine if it truly never happened).

  • If amounts differ (QBO says $105 but bank says $150), inspect the details. Maybe part of a transaction was recorded incorrectly (e.g., a bank deposit net of fees versus gross). Adjust the entry to match the actual amount or split into multiple if needed (such as recording merchant fees).

  • Watch for bank feeds still in “For Review”: In many cases, transactions that weren’t categorized will still be sitting in the bank feed. You need to add or match those. In our cleanup, we found many credit card transactions that had downloaded but were never added to the books. We went through and added/categorized them, which then allowed the credit card to reconcile fully with only a tiny interest adjustment.

• Address beginning balance adjustments: QuickBooks will warn you if the beginning balance for a reconciliation doesn’t match the last reconciled balance (this happens if transactions were deleted or changed after a previous reconciliation). If during cleanup you find a beginning balance discrepancy, use QBO’s Reconciliation Discrepancy report to identify what changed. You may need to re-reconcile a previous period or book an adjustment entry for that difference if it can’t be tracked down easily (small differences can be posted to an expense called Reconciliation Discrepancies, but larger ones should be investigated)quickbooks.intuit.comquickbooks.intuit.com.

• Repeat for each month/account: Work forward in time one statement at a time. It’s a bit tedious but methodical. As you proceed, the process usually gets “cleaner” – e.g., once you’ve entered missing transactions and removed obvious duplicates, later months start to reconcile with less adjustments needed.

• Clear old uncleared items: After reconciling all current-period months, take a look at the reconciliation report or the register for any uncleared transactions (transactions recorded in QBO that were never matched to a statement entry). Typical culprits are old outstanding checks that never cleared the bank, or deposits that were recorded but never actually happened. Discuss these with the owner. If a check from two years ago never cleared, it might have been lost – standard practice is usually to void it and possibly reissue if needed, or just void if it’s truly stale. Document any such actions (especially if voiding a very old transaction – sometimes you void it in the current period to avoid messing up prior tax filings).

• Don’t forget PayPal or Cash accounts: If the business uses a PayPal account or petty cash, those should be reconciled too. For PayPal, you might reconcile similar to a bank (using PayPal monthly statements). Petty cash can be reconciled against a cash log or just ensured the balance is reasonable.

By the end of this step, every bank and credit card account on the Balance Sheet should be reconciled (you should see a “last reconciled” date as the end of the cleanup period, e.g., 12/31/2024). This provides a solid foundation for the rest of the cleanup. In our case study, after doing this, we had confidence that all cash transactions were accounted for – we even saved each monthly reconciliation report to show the client and CPA. We found and fixed significant errors (a missing $2k expense and a duplicate deposit) through this process, preventing a $4k swing in the financials.

Owner Impact: Reconciling ensures no money “falls through the cracks.” You won’t miss out on claiming legitimate expenses (which could cause overpaying taxes) because an expense was never entered. Likewise, you won’t count income twice because a duplicate slipped in. It gives you confidence that the cash in your books is real. Think of it this way: if your checkbook says $50k but the bank really has $45k, you might attempt to spend $5k that doesn’t exist – a reconciled account prevents that dangerous discrepancy.

4. Sales and Accounts Receivable (A/R) Cleanup

With the bank side of things under control, turn your attention to sales and accounts receivable. The goal here is to ensure that revenue is recorded correctly and that your accounts receivable balance (money owed to you by customers) is accurate and collectible.

Steps to clean up A/R and sales:

• Review Open Invoices: Run an Accounts Receivable Aging Detail report. Examine each open invoice, especially any older than, say, 60-90 days. For each invoice, determine its status:

  • Was it paid but still showing open? If you find an invoice that the customer actually paid (maybe you see the deposit in the bank or the owner confirms it was paid) but it’s still open in QBO, then you have an unapplied payment issue. Search QBO for any payment or deposit that corresponds to that amount/customer around that date. If you find it (perhaps recorded as a deposit to an income account or to Undeposited Funds but never applied), use Receive Payment to apply it to the invoice. If the payment was never entered at all, enter it (use the actual payment date) and mark it as deposited to the appropriate account (or Undeposited Funds to later group with the bank deposit, if applicable).

  • Is it legitimately unpaid? If the invoice is still collectible, leave it open (perhaps send a reminder to the customer, though that’s outside the cleanup’s scope except to inform the owner).

  • Is it uncollectible (a bad debt)? If the customer won’t pay (e.g., they went out of business, dispute, etc.), you’ll want to write it off. The proper way is usually to issue a Credit Memo for the invoice amount, coding it to a Bad Debt expense account, and apply that credit memo to the invoice, which will close it out. This way, your A/R is cleared and your P&L records the loss.

  • Was it a mistake or duplicate? Sometimes invoices were entered in error (e.g., a job was invoiced twice, or an invoice was created then a sales receipt was also used). If you confirm an invoice is not valid, you can delete or void it. Deleting will remove it entirely; voiding will zero it out but keep a record. For prior year invoices, voiding might be better to keep an audit trail (but note voiding will affect books as of that date, so often deletion is fine if it truly never should have been there).

• Match Payments in Undeposited Funds: If there’s a balance in Undeposited Funds related to customer payments (as discussed earlier), this is part of A/R cleanup too. Open the Undeposited Funds detail to see which customers and dates. Match them to actual deposits or decide how to clear them (either by recording a deposit now or linking to an existing bank entry). The end goal: Undeposited Funds should ideally be zero, or only contain payments from very recent dates that truly are waiting to be deposited.

• Check for Negative A/R or Credits: If any customers have a negative balance in A/R, that indicates you’ve recorded a payment or credit that hasn’t been applied to an invoice (the customer effectively has a credit on books). Investigate those. You may simply need to apply a credit memo or payment to an existing invoice. Or it could be a duplicate payment that shouldn’t be there.

• Verify Revenue Accounts: As you clean A/R, also glance at the income accounts on your Profit & Loss. Are sales recorded in the correct accounts? For instance, if some sales were mistakenly booked as Other Income or into a suspense account, reclassify them. Ensure that what was invoiced ties to revenue accounts properly. If you had integration issues that created duplicate sales, you would have removed or adjusted those, so revenue should now reflect reality (in our example, we noted that originally income was overstated by $5k due to duplicate entries, which we fixed).

After these steps, generate a fresh A/R Aging summary and ensure the total matches the Accounts Receivable amount on the balance sheet (it should, if everything is applied correctly). In the Modern Global case, after applying payments, writing off bad debts, and deleting one duplicate invoice, A/R went from $10k (with many incorrect items) down to $2k (just one genuine invoice) and that matched the balance sheet. We could confidently tell the client, “These are the only people who owe you money now, and these amounts are real.”

Owner Impact: A cleaned-up A/R means you know exactly how much your customers owe you and can be confident in that number. It prevents you from overestimating your expected cash inflow (no phantom invoices inflating sales) and ensures you’re not leaving money on the table (if an invoice was unpaid, now you know to follow up, and if it was paid, you’re not mistakenly writing it off or double-counting it). It also gives you a clear picture of revenue in the period – only real sales are counted.

5. Expenses and Accounts Payable (A/P) Cleanup

Next, let’s tackle Accounts Payable and expenses – essentially the mirror of A/R. We want to be sure your liabilities to vendors are accurate and that all expenses are recorded in the correct period and account.

Steps to clean up A/P and expenses:

• Review Open Bills: Run an Accounts Payable Aging Detail report. Just like with A/R, inspect each open vendor bill:

  • Was it paid but not recorded as paid in QBO? This is very common. The owner might have paid a bill (by check, ACH, or credit card) but in QBO the bill is still sitting open because no bill payment was entered. If you find an open bill that the vendor has been paid for, you need to record a Bill Payment in QBO. Date it the date the payment was made, use the correct bank or credit account from which it was paid, and apply it to the open bill. This will close the bill. For example, in our cleanup, the A/P report showed three contractor bills totaling $5,000 that were months old. The owner confirmed those were paid via bank wire. We entered bill payments for each, dated on the wire dates, using the checking account – QBO then marked those bills as paid.

  • Is it a duplicate or error? Perhaps a bill was entered twice, or a bill was entered for an expense that was also recorded via check/expense form. If you verify a bill is not actually owed (maybe the product was never received or it was a mistake entry), you can delete the bill or void it. In our case, we found a duplicate office rent bill – the bookkeeper had entered it twice – so we removed the duplicate, leaving just one correct entry.

  • Unapplied vendor credits: Check if any vendors have a credit balance (negative amount) in the A/P Aging. That indicates a credit memo or overpayment on file. You should apply those credits to any open bills for that vendor or, if none, consider if you need to refund or clear them. Make sure QBO’s vendor credits reflect reality (perhaps the vendor issued a refund that wasn’t recorded).

• Catch up any missing expenses: While focusing on bills, also think broadly about expenses. During reconciliation you might have added missing expense transactions already. But if the client was lax in entering bills and you have their bank statements, ensure that any expense that should have been a bill is either entered as a bill or was captured via another method. Sometimes during cleanup, bookkeepers decide to enter historic expenses directly (as checks/expenses) instead of as bills if the distinction doesn’t matter (e.g., if they already paid them and no need to track as payable). That’s okay, as long as every payment is recorded one way or another.

• Verify expense account coding: As you go, spot-check expense categories. Are there any large “Uncategorized Expense” amounts? If so, dig in and reclassify them. Did the owner accidentally record some expenses to the wrong accounts (like that fixed asset vs expense example)? Fix those in this stage. The idea is to tidy up the Profit & Loss so that expenses are where they belong. In the Modern Global example, we reclassified $5k from an expense account to a fixed asset (because they bought equipment), and moved a personal expense out of travel to draws – those kinds of adjustments often come to light when reviewing expenses in detail.

• Ensure A/P ties out: After adjustments, the total A/P on the aging report should equal the Accounts Payable account on the Balance Sheet. If it doesn’t, search for any journal entries or direct postings to A/P that might cause discrepancies (in general, every A/P entry should be via Enter Bill or Bill Payment, not random journals – unless adjusting opening balances).

• Sales tax on purchases (if applicable): If the business tracks sales tax on purchases (for VAT/GST perhaps, or use tax), verify those entries while you’re in expenses. This might be beyond scope for many SMBs in the U.S., but worth a mention if relevant.

After cleaning up A/P, your unpaid bills list should be accurate. In our case study, after recording the missing bill payments and deleting a duplicate, A/P went to $0 (no unpaid bills) which matched the Balance Sheet. That told us we weren’t showing any liabilities that the business didn’t actually owe.

Owner Impact: A cleaned-up A/P ensures you know what you really owe. You won’t accidentally pay a vendor twice (because QBO incorrectly showed a bill open) or conversely, you won’t forget a debt because it was missing in QBO. It also means your expense totals are accurate – you’re not missing expenses (which could understate your costs and overstate profit) nor are you claiming deductions for things you never actually paid. In short, you can trust that if QBO says you owe $X to vendors, you truly owe that, and all expenses that should be recorded are there.

6. Other Areas: Payroll, Loans, Inventory, and Fixed Assets

With the major transactional areas (banking, sales, expenses) cleaned up, turn to the specialized areas of the books. These often involve balance sheet accounts and require ensuring that the balances are correct and properly supported. Key areas include payroll-related accounts, loans, inventory (if applicable), and fixed assets & depreciation. Not every company will have all of these, but for completeness we’ll cover them:

• Payroll and Payroll Tax Liabilities: If the company has employees, payroll can be a source of book-to-real-life mismatches. Many small businesses run payroll through a service like QuickBooks Payroll, Gusto, ADP, etc. If they weren’t diligent, the wages and payroll taxes might not all be recorded in QBO. What to do:

  • Reconcile the payroll expense accounts against payroll reports. If you see that QBO’s wage expense is zero but you know payroll was run, you’ll need to enter those figures. Sometimes using the payroll service’s QBO integration or manual journal entries (debit wage expense, employer tax expense; credit various liabilities or cash) is needed to reflect the payroll costs.

  • Check the Payroll Liabilities (like payroll tax payable) on the balance sheet. Ideally, after all taxes are paid, this should be zero (except maybe the most recent period’s accrual). If you find a balance from a prior period that should have been paid, confirm if it was paid. For example, we found a $500 Payroll Tax Payable on the books lingering from last year, even though all taxes had been paid. The fix: we recorded an adjusting journal entry moving that $500 from the liability to a payroll tax expense, effectively clearing it.

  • Add any missing payroll entries: In our case, the client hadn’t recorded any of their Gusto payroll for the current year in QBO. We took the annual payroll report and booked the total wages and taxes so that the P&L showed those expenses and the balance sheet showed any payable for the last payroll or so.

  • After cleanup, payroll expense on the P&L should reflect what you actually paid in wages and payroll taxes for the year, and payroll liability accounts (if not using QBO’s built-in payroll module) should be correct (often zero if all deposits made, or equal to, say, the last payroll’s tax that will be paid next period).

  • Note: If using QBO’s own payroll, a lot of this is automated, but check for any discrepancies (sometimes prior payroll adjustments or errors can leave hanging balances that need adjusting).

• Loans and Notes Payable: Compare the loan balances in QBO to the loan statements or amortization schedules. Common issues include:

  • All loan payments being recorded as deductions of principal, ignoring interest. This will make the loan balance in QBO too low compared to reality (because some of that payment should have been interest expense). For example, a loan might show $50k in QBO but the bank says $48k because $2k of payments were misclassified. We hit exactly that scenario: the bookkeeper had applied about $2,000 of interest payments toward the loan principal. We reclassified that amount from the loan account to Interest Expense, which brought the loan balance in QBO up to the correct $48k and properly increased interest expense by $2k.

  • If the loan hasn’t been updated at all, you may need to record accrued interest or adjusting entries to get to the correct ending balance.

  • Make sure new loans taken are recorded as well. If the owner took out a new loan and it was deposited, ensure that liability is on the books.

  • After adjustments, each loan’s ending balance in QBO should match the lender’s records for the cut-off date of cleanup.

• Inventory (if applicable): Inventory accounting can be complex, but at minimum:

  • If the company uses QBO’s inventory tracking (available in QBO Plus/Advanced), ensure inventory quantities and values are accurate. Look for negative inventory (which indicates they sold items they never purchased/entered properly). Adjust inventory quantities via inventory adjustments to reflect reality (which will hit cost of goods sold).

  • Reconcile the Inventory Asset account on the balance sheet to a physical inventory if possible or to the inventory valuation report in QBO. Any discrepancies may need adjustments.

  • Check Cost of Goods Sold (COGS) entries. Are all product sales associated with COGS? If some inventory purchases were wrongly expensed to Supplies or left in an asset account, reclassify them appropriately.

  • For many small businesses, an end-of-year inventory true-up is done: e.g., if they don’t use perpetual tracking, you’d ensure the inventory asset equals the actual ending inventory and adjust COGS accordingly.

  • Inventory was N/A in our example case (service business), but for a retail or e-commerce case study, common cleanup tasks include removing ghost inventory (often from integration sync errors) and fixing SKU mapping issues that caused incorrect postings.

• Fixed Assets and Depreciation: Review any large purchases of equipment, vehicles, machinery, or other capital assets:

  • Determine if they were properly recorded as fixed assets or if they were expensed erroneously. A frequent issue is that an asset above the capitalization threshold (say a $5,000 computer) was booked entirely to an expense like Office Supplies. In cleanup, you’d likely reclassify that to a Fixed Asset account. In our example, we moved a $5k computer purchase out of expenses into a fixed asset called “Equipment”.

  • Record depreciation for the period that’s been cleaned (if the tax accountant has provided depreciation, use those figures; otherwise, you can make an estimated entry or leave it for the accountant if this is a pre-tax cleanup). In Modern Global’s case, the CPA gave us a depreciation figure ($1k) which we recorded, crediting Accumulated Depreciation and debiting Depreciation Expense.

  • Ensure the Fixed Asset accounts plus accumulated depreciation net out to the correct book value of assets.

  • If any old assets were sold or disposed of during the period and still on books, record appropriate journal entries to remove them (and any gain/loss if needed).

• Other Balance Sheet items: A few other things to review:

  • Opening Balance Equity (OBE): This is a catch-all account QBO sometimes uses when initial balances are entered. By the end of a cleanup, OBE should be zero – any amount in there should be moved to Retained Earnings or an appropriate account. We saw an OBE of $500 lingering from some initial setup; we journaled it into Retained Earnings to clear it.

  • Owner’s Equity and Draws/Contributions: If the owner commingled personal funds or took draws not recorded, record those transactions properly. E.g., classify personal expense paid from business as Draws, and any personal cash put into business as an Equity Contribution. In our case, we identified about $3k of personal expenses in the books; we moved them out of business expenses to an Owner Draw account. This ensures the equity section properly reflects those transactions (and they’re not lurking in expenses).

  • Sales Tax Payable: If the business collects sales tax, verify the liability account. Are there past periods of sales tax that were never filed or paid? If so, that’s a liability that needs addressing (and possibly a conversation about compliance). If sales tax was overpaid or underpaid, adjust the books accordingly (QBO has a sales tax adjustment function to use rather than manual journal, to keep the sales tax center in sync).

  • Accrual adjustments: If you maintain books on accrual basis, ensure any needed accruals (like prepaid expenses, accrued expenses) are adjusted. For example, if the client paid a big insurance premium upfront, part of that might be a prepaid expense – consider adjusting it if doing GAAP-heavy cleanup. This might be beyond the immediate scope, but worth a quick scan for any glaring issues.

After cleaning these areas, the Balance Sheet should be in excellent shape. Every account on it either ties to supporting documentation or has been intentionally adjusted to correct value. In our example, after addressing the loan, payroll, and fixed asset issues, the Balance Sheet balances and all known differences were resolved: the loan was corrected, payroll liabilities cleared, equipment capitalized with depreciation, OBE zeroed out, etc.. We also confirmed the equity section made sense (retained earnings plus net income minus draws equaled the true retained earnings after all adjustments).

Owner Impact: These steps ensure the long-term accounts are accurate. For instance, if you don’t correct loans and interest, you might think you owe more (or less) than you actually do, which can lead to misinformed decisions (like taking on unnecessary debt or violating loan covenants). If fixed assets aren’t tracked, you could miss depreciation tax deductions or misstate your asset values (which matter if you seek financing). Cleaning up payroll liabilities ensures you won’t get hit with sudden tax bills you thought were paid. Overall, this gives a true, compliant financial position – assets, liabilities, and equity are all properly stated.

7. Review Financial Statements and Tie-Out Reports

At this stage of the cleanup, all the transactions have been corrected and the registers reconciled. Now, perform a final review of the financial statements to verify everything ties out and looks reasonable:

• Balance Sheet tie-out: The Balance Sheet should now be correct as of the cleanup date (say Dec 31, 2024). Check that:

  • Assets = Liabilities + Equity (QBO will show if it’s out of balance – it should not be).

  • Every account on the Balance Sheet makes sense. For example, the A/R on the Balance Sheet should equal the total on the A/R Aging report (and it should, if you applied all payments properly). Same for A/P.

  • No Uncategorized or Suspense balances: Ensure Uncategorized Asset, Uncategorized Expense, Opening Balance Equity, Ask My Accountant, etc., are zero or don’t even appear. We verified that after our reclassifications, accounts like Uncategorized Income/Expense and Ask My Accountant were all zero.

  • Equity section: If there were any odd clearing accounts used (some people create a “Suspense” account on the balance sheet), those should be zeroed out or eliminated. Equity should show real components (common stock, retained earnings, owner contributions/draws, and current net income).

  • If you have the prior year tax return Schedule L (balance sheet for tax), compare it to the Balance Sheet in QBO for that date. Note any remaining differences and ensure there’s a logical explanation or adjustment for them. It’s ideal if, after cleanup, last year’s ending books match what was reported (if differences were because of errors, you’ve adjusted them either into retained earnings or via corrected entries).

• Profit & Loss analysis: Look at the P&L for the cleaned year (and maybe compare to previous year if available):

  • Compare to expectations or prior periods: If something looks off (e.g., utilities expense is dramatically lower than last year because you reclassed half of it as a fixed asset purchase), be ready to explain that. In our case, Office Supplies expense dropped a lot compared to last year, but that was because we moved the computer purchase out of it – we made a note of that so the owner and CPA understood why.

  • Margins and totals: Ensure that revenue looks correct (not significantly over/understated after removing duplicates and adding any missing sales). Ensure cost of goods sold (if any) is in line with sales after your adjustments. Check gross profit margin if relevant, see if it’s plausible.

  • Expense categories: Verify there are no large amounts sitting in weird places. For example, if you have a large “Miscellaneous Expense” or “Ask My Accountant” that’s not zero, drill down and reclassify those items properly. We already merged and cleaned duplicate accounts to streamline the P&L (like merging “Telephone” and “Internet”).

  • Tax basis check: If the business files on cash basis for taxes, you might also run a cash-basis P&L in QuickBooks and see if there are differences that need attention (commonly, on cash basis, if A/R or A/P weren’t fully cleaned, income or expenses could drop out). Since we cleaned up all A/R and A/P, a cash basis P&L for 2024 in our case would naturally align with accrual except for the timing differences we deliberately managed.

  • Net Income final sanity check: Discuss the final profit number with the owner (and perhaps their tax accountant). In our cleanup, the net income ended up around $30,000, whereas the CPA had initially estimated $50,000 from the messy books. The $20k difference was explained by all the corrections (removed duplicate income, added missing expenses, etc.). This kind of delta is common – part of delivering a cleanup is explaining why the “bottom line” changed and ensuring it’s backed by real corrections, which in our case it was.

• Reporting Package: As part of final review, prepare the reports you’ll deliver or save:

  • Cleaned Balance Sheet and Profit & Loss (on accrual, and cash basis too if needed for tax).

  • A/R and A/P Aging reports (to show they match the Balance Sheet and to list any remaining open items).

  • Perhaps a Journal report of all adjusting journal entries made during cleanup (for transparency).

  • Bank Reconciliation reports for each account (some bookkeepers include these to show each month was reconciled).

  • Any other relevant reports (inventory valuation, depreciation schedule, etc., if needed by the accountant).

• Document findings: It’s good practice to write down a summary of major adjustments and findings. For example: “Net income was adjusted down by $20k due to $5k duplicate income removed, $5k asset capitalization (moving expense to balance sheet), $3k personal expenses removed, $2k interest expense added, $3k bad debts, etc.”. We actually did this for Modern Global – highlighting each fix and its impact on profit. This helps the owner understand the value of the cleanup and also creates a record in case questions come up later.

The final review is basically your quality check. If something still doesn’t look or feel right, investigate now. Once everything passes muster, you’re ready to finalize the cleanup.

Owner Impact: Seeing the cleaned financial statements is often an eye-opener for owners. This is where they truly appreciate the cleanup. They can now trust their Balance Sheet – if it says $50k in bank, they know it’s really there; if it says $48k loan, that’s what they owe. And the Profit & Loss reflects reality – no phantom income, no missing expenses. This accuracy is crucial for making decisions (like pricing, budgeting, cost-cutting) and for tax compliance. It’s essentially giving the owner a reset button on financial clarity.

8. Lock the Books and Prevent Future Errors

Cleanup complete! But our job isn’t done until we put measures in place to prevent the books from falling back into disarray. Two important final steps are: locking the cleaned period and setting the stage for better bookkeeping habits going forward.

• Set a Closing Date in QBO: QuickBooks Online allows you to set a closing date and password (in the Account and Settings > Advanced section). This is critical after a cleanup. Set the closing date to the last day of the period you cleaned (for example, 12/31/2024 if you cleaned the full year 2024) and require a password to edit transactions dated on or before that date. This prevents accidental (or intentional) changes to the historical data you just fixed. We did this for our case: after finishing 2024’s cleanup, we locked the books for 2024 with a password so that the owner can’t inadvertently mess up those numbers. If you are the owner, do this to protect yourself from, say, your future self making an entry in the wrong period or an integration syncing old data. (If something absolutely needs to change later, you can reopen, but it’s better to lock and only unlock if needed.)

• Communicate Changes: If you’re handing off to a client or even if it’s your own books, document what was done. Have a wrap-up meeting or summary email: go through the reports, point out improvements, and explain any significant changes from what they might have previously believed. In our example, we presented the clean financials and highlighted fixes (duplicate $5k income removed, etc.) so the owner understood the new numbers.

• Owner Education & Process Improvements: This is a big one. A cleanup often reveals why the books got messy. Use those insights to coach the business owner or bookkeeper on avoiding repeats:

  • Emphasize the importance of monthly bookkeeping routines. We often tell clients that once things are clean, implementing a monthly (or at least quarterly) close process is key. That means reconciling bank accounts every month, reviewing the financials, and addressing discrepancies regularly instead of letting them pile up.

  • Leverage QBO’s Bookkeeping Review tool each month to catch uncategorized transactions or undeposited funds build-up before they get out of hand.

  • Reconcile monthly, not just at year-end. It’s much easier to fix one month at a time than twelve all at once.

  • Use QBO’s automation carefully: Set up bank rules for consistent categorization but still glance at what the bank feed is adding. Use the AI suggestions but review them – over time they will get smarter and truly save time, as QBO learns your patternsquickbooks.intuit.comquickbooks.intuit.com. Also, Intuit’s new Accounting Agent will even auto-reconcile many transactions for you in the background, but you should still glance at the Business Feed to approve the work and ensure it looks rightquickbooks.intuit.comfirmofthefuture.com.

  • Invoice and receive payments properly: We often show clients the correct workflow (create invoices in QBO, use Receive Payment, and then record deposits from Undeposited Funds). This prevents the Undeposited Funds issue entirely. For sales without invoices (like daily retail sales), consider using Sales Receipts and depositing those to bank properly.

  • Keep personal expenses out of business books: If commingling was an issue, encourage the owner to get a separate credit card or account for personal stuff. At the very least, set up a system to code any personal expenses to a Draw account immediately.

  • Monitor integrations: If the client will continue using integrations (Shopify, etc.), ensure they understand how to review for duplicate entries or set up those integrations correctly. Sometimes using summarized journal entries for sales daily/weekly can be cleaner than importing every single transaction – depending on their volume and needs.

  • Regular reviews: Suggest that they or you perform a quick review each month of key accounts. For instance, scan Undeposited Funds, A/R, A/P each month – they should not be accumulating unexplained balances. Also, QBO’s new anomaly detection might pop up in the Business Feed if something looks off; don’t ignore those alerts.

  • Provide a Monthly Close Checklist: Some bookkeepers hand the owner a simple checklist (e.g., “By the 10th of each month: make sure last month’s bank accounts are reconciled, undeposited funds is zero, all bills and invoices entered, review profit & loss vs budget,” etc.). Intuit’s Bookkeeping Review essentially has this built-in, but a one-page checklist can reinforce it.

• Optional – Follow-up support: If you’re a bookkeeper, you might offer ongoing bookkeeping services after a cleanup. The cleanup often shows the client the value of accurate books, and many opt to have a pro maintain them going forward (so they never get that messy again). If you’re the business owner, consider hiring at least an external accountant to review your books quarterly if you’re maintaining them, just to catch issues early.

In our case study, we ended our engagement by providing recommendations to Modern Global’s owner: we explicitly said “Going forward, invoice through QBO for all sales, record deposits through the Undeposited Funds workflow to avoid buildup, reconcile every month, and keep personal expenses out of business accounts.” We even suggested a separate personal credit card for the owner. These pointers, along with the now-clean books, set them up on the right foot. We then thanked the client and closed out the project, feeling confident that the next tax return will be filed on accurate numbers and the owner has the knowledge to maintain order.

Owner Impact: This final step is all about protecting the clean slate you now have. By locking the books, you ensure no accidental changes ruin your hard work. And by adopting better habits (monthly reconciliation, using QBO tools, separating personal spending, etc.), you greatly reduce the chance of another messy cleanup project in the future. Essentially, you’re setting up a system where financial messes become less likely, saving you stress and money down the road.

Real-World Case Studies

To bring all these concepts to life, let’s look at a few brief case studies. These illustrate common scenarios for cleanup projects, how the issues were resolved, and what the outcomes were – including the impact on the business owner.

Case Study 1: E-commerce Seller with Duplicate Income Entries

Scenario: A small online retail business sells through their Shopify store and uses PayPal to process payments. The owner connected Shopify and PayPal to QuickBooks Online, but didn’t realize both integrations were sending data for the same sales. Over a year, the books became a tangle of duplicates: every sale was recorded twice (once from Shopify as an invoice or sales receipt, and once from the PayPal bank feed as a deposit). Additionally, PayPal fees were not being recorded at all, and payouts from Shopify were confusingly posted. By year-end, the Profit & Loss was overstating income significantly, and the owner’s income tax estimate was through the roof. The Balance Sheet also showed a large balance in a “Shopify Clearing” account and Undeposited Funds, which the owner didn’t understand.

Problems Identified: Duplicate sales revenue (overstating income), unrecorded merchant fees (understating expenses), and funds sitting in Undeposited Funds and clearing accounts that should have been zero. The sales tax collected via Shopify was also off because of duplicates.

Cleanup Actions: We first identified the pattern of duplication – each Shopify invoice had a corresponding PayPal deposit. We decided to keep the Shopify sales records (because they had detailed line items needed for sales tax reporting) and eliminate the redundant PayPal “sales” entries. We matched PayPal deposits to the Shopify-recorded transactions where possible. Concretely, we created a rule to record PayPal bank deposits not as income but as transfers to a clearing account, and then matched those against the open Shopify receipts. In cases where QBO wouldn’t match automatically, we manually matched or recorded the deposit against Undeposited Funds (where Shopify had left the payment). This cleared the Undeposited Funds and eliminated the double-counting.

We also recorded PayPal fees for each payout (using the PayPal statements to gather fee totals) as expenses, which explained why the bank deposit was less than the sale amount. The “Shopify Clearing” account was reconciled to zero by period end. In the process, we found a few sales that were recorded in Shopify but the payment failed – we left those invoices open or wrote them off if needed, so income wasn’t overcounted.

After cleanup, the income on the P&L dropped to the correct amount (roughly 10% lower than before, which equated exactly to the duplicate entries we removed and the fees we added back as expenses). The sales tax payable was adjusted to reflect the true taxable sales. The owner’s taxable income was significantly reduced – preventing an overpayment of taxes that would have occurred had those duplicates stayed. We sat down with the owner and explained how to prevent this: either disable one of the integrations or adjust settings so that only one source creates the sale in QBO and the other just records the payment or not at all (some people choose to only record summarized daily totals from Shopify to avoid this). We also introduced them to the Business Feed in QBO, which can help spot unusual surges in income that might indicate a problem like this.

Outcome: The owner avoided potentially overpaying thousands in taxes on phantom income. Their revenue and expense figures now aligned perfectly with their actual payment processor reports. Going forward, they opted to let Shopify handle the detailed sales recording and turned off importing PayPal sales (only recording the monthly settlement). This case study underscores how integration issues can inflate numbers and how a cleanup not only fixes the books but can save real dollars and headaches.

Case Study 2: Consultant with 18 Months of Unreconciled Accounts

Scenario: A self-employed consultant had been DIY-ing her bookkeeping but got swamped with work and stopped reconciling or categorizing regularly. By the time she sought help, nothing had been reconciled for a year and a half – the last “real” reconciliation was 18 months ago. She had been faithfully importing bank feeds, and sometimes categorizing transactions, but often leaving many uncategorized or accepted to wrong accounts. The result was an income statement that made no sense (lots of uncategorized expenses, arbitrary categorizations) and bank registers that didn’t match reality. The Balance Sheet showed tens of thousands in Uncategorized Asset (from downloaded transactions with no category) and a large Opening Balance Equity (from prior conversions and errors). It was a textbook case of benign neglect.

Problems Identified: Numerous transactions unreconciled and uncategorized, accounts not matching statements, personal vs. business transactions mixed together (e.g., she paid some personal bills from the business account when cash was tight, and vice versa). Essentially, both catch-up and cleanup were needed – catch up on data entry for missing items and cleanup the mis-posted ones.

Cleanup Actions: We kicked off with a full diagnostic and realized the fastest approach was to treat it almost like a fresh start from a certain point. We decided to start clean from the beginning of the last tax year: we took the ending balances from her prior year tax return as a baseline. Because 18 months were unreconciled, we tackled the last 12 months first (the current tax year) and planned to handle the older 6 months as needed for comparative purposes. Using bank statements, we reconstructed and reconciled month by month. Many transactions had been downloaded but not added, so it was a matter of adding them correctly (with vendor/memo and account). For categorization, we leveraged QBO’s AI suggestions a lot – after the first several transactions, it started suggesting categories for similar payees, which sped up the workquickbooks.intuit.comquickbooks.intuit.com. We still reviewed each suggestion but found them mostly accurate for routine things (e.g., it correctly learned that “Adobe” should be Software Expense, etc.).

During reconciliation, we encountered some classic issues: a few transactions had been deleted after being reconciled (from over a year ago), causing beginning balance discrepancies. We used the reconciliation discrepancy report and found those transactions, re-entered them (or adjusted opening equity for small amounts)quickbooks.intuit.comquickbooks.intuit.com. We discovered about five checks that never cleared – after confirming with the client, we voided those (one had been reissued; others were just voided). We also found the client had recorded some transfers incorrectly (transfers between accounts showing up as double expenses) – we cleaned those by properly using the Transfer feature or matching the two sides.

For personal expenses, we identified them (things like grocery store charges, personal travel) and reclassified every one to an Owner Draw account. We educated the client that these aren’t business expenses (so they won’t reduce her profit on the books or taxes). She was okay with that, as she understood those were personal.

After painstakingly reconciling and categorizing 18 months of data, the financials finally made sense. The Uncategorized accounts were zero, Opening Balance Equity was minimal (just reflecting an initial rounding adjustment), and all bank/credit accounts balanced to statements. Her income actually went down slightly after removing personal expenses and ensuring all legitimate expenses were in, but now it was accurate. We also prepared comparative statements to show her the difference pre and post-cleanup.

Crucially, we set her up on QBO’s Bookkeeping Review monthly process going forward. We scheduled a monthly reminder for her to reconcile the month by the 10th. We also enabled the new Intuit Accounting Agent features in her QBO (since she was on QBO Plus) – this will in the future categorize many transactions automatically and even reconcile simple onesfirmofthefuture.com. We showed her how the AI anomaly detection might flag if, say, her travel expenses suddenly spike or if a transaction looks out of placefirmofthefuture.com – giving her an early warning system.

Outcome: The consultant went from having no clear idea of her finances for over a year to having an up-to-date set of books. She was relieved to see the true numbers and used them to better plan her taxes (the cleanup happened just before year-end, giving time to perhaps make last-minute tax-deductible purchases or contributions knowing the real profit). She remarked that seeing everything organized reduced her stress greatly – previously, she had avoided looking at her books out of frustration, but now she felt in control. And with the processes we put in place (and possibly engaging us for quarterly check-ins), she is far less likely to end up in the same situation. Importantly, she can now use her financial reports to make decisions (like how much cash flow she has for a new marketing initiative, etc.), whereas before the reports were essentially useless. This case highlights how a thorough catch-up and cleanup can rescue a solo business owner from the brink of financial chaos and set them up with better habits and tools.

Case Study 3: Retail Business Misusing Undeposited Funds

Scenario: A small brick-and-mortar retail shop was using QuickBooks Online to ring up sales but wasn’t using it correctly for deposits. Each day they entered their sales totals as Sales Receipts (good) but then when the bank deposits came in (lump sums from their point-of-sale system’s credit card processor and cash deposits), they recorded new income transactions for those again. They didn’t realize those daily sales receipts were sitting in Undeposited Funds waiting to be grouped. Over time, the Undeposited Funds account swelled (sometimes they “accidentally” cleared some out by making dummy deposits, but largely it was full of old entries), and their income was effectively recorded twice: once via the sales receipts, and once via the manual deposit entries. The owner noticed something was off when her P&L showed roughly double the sales that her cash register reports showed! Additionally, the bank reconciliation was a nightmare because those manually entered deposits didn’t match any specific sales receipts.

Problems Identified: A huge balance in Undeposited Funds (indicating many sales receipts never deposited in QBO), duplicate income entries, and confusion in reconciliation (as some deposits in QBO didn’t tie cleanly to groups of sales receipts). Also, the sales tax collected on those sales was off in QBO because of duplicates.

Cleanup Actions: We started by quantifying the duplicate income. By running a Sales by Customer report and comparing it to actual daily totals, we saw that essentially every day’s sales were counted twice. We confirmed the total amount in Undeposited Funds roughly equaled the “extra” income on the books. To fix this, we took a two-pronged approach:

• We deleted all the manual deposit income entries that the owner had made for which corresponding sales receipts existed. This removed the duplicate income from the P&L. We had to be careful only to delete the ones that were duplicates, not legitimate other deposits like loans or misc. funds.

• Then, we went into the Undeposited Funds window (Make Deposits screen in QBO) and saw dozens of sales receipts sitting there. We recreated the bank deposits in QBO properly: e.g., if on June 15, 2025 the owner’s bank deposit was $1,200 consisting of $1,000 in credit card sales and $200 in cash, we selected the matching sales receipts for that day (which totaled $1,200) and deposited them to the checking account on that date. This cleared those items out of Undeposited Funds and matched the actual bank transaction. We did this for each day or week as needed. (There were instances where multiple days were combined; we used their POS reports to figure out correct groupings.)

• As a result, Undeposited Funds balance shrank dramatically as we cleared it, and the bank register got the proper deposit entries (replacing those manual ones we deleted).

• We then reconciled the bank account. Now that deposits in QBO corresponded to actual bank deposits, the reconciliation went through without issue. In a couple of cases, we had a slight difference because the owner had lumped a different amount; we adjusted those minor differences to a small “Cash Over/Short” expense.

• We checked the income statement and found the sales revenue now matched exactly the actual sales per the cash register reports – essentially halved from what QBO showed before cleanup. We also adjusted the sales tax payable account, which had been off since duplicate sales were recorded: after removing the duplicates, the sales tax liability also came into line with what actually was owed to the state.

For training, we walked the owner through the proper workflow: record sales receipts to Undeposited Funds, then use Bank Deposit in QBO to combine them to match the bank – don’t enter new income for deposits. We even posted a short checklist near her register: “End of day: Enter sales receipt in QBO for cash sales, check Undeposited Funds; When deposit hits bank, record deposit in QBO selecting those sales receipts.” We also enabled the setting in QBO that automatically groups payments with the same date (a feature that can help if the dates align).

Outcome: The company’s revenue figures were corrected (cutting them roughly in half to the true amount), which avoided a vastly overstated income situation. The owner likely saved on taxes and got accurate financials – previously her books were showing she was extremely profitable (when in reality it was an artifact of double-counting income). The Undeposited Funds account was cleaned to $0, as it should be at period end, so any new balance there will immediately signal to her that she has payments to deposit (which she now knows how to do). She found this cleanup enlightening – it explained why her “books said we have way more profit than our bank account shows.” It was a teaching moment: once we explained how QBO expects you to handle undeposited funds, she adjusted her daily process. Going forward, her monthly bookkeeping is much easier (and the external accountant who does her taxes was very pleased to see a correct set of books). This case study is a classic example of a common QBO newbie mistake and shows how cleanup fixes not just the numbers but also the workflow.

Each of these case studies highlights different cleanup triggers – integrations, neglected reconciliations, and workflow mistakes – but they all share a common theme: after cleanup, the businesses had accurate books and better processes, which directly translates to better business outcomes (whether it’s saved money, reduced stress, or improved decision-making capability).

Should You Clean Up or Start Fresh with a New File?

One big question that often arises at the start of a messy bookkeeping project is: Is it worth cleaning up the existing QuickBooks Online file, or would it be easier to wipe the slate clean and start a brand new QBO file? The answer depends on the severity of the issues and the value of past data. Here are some tips to help decide:

Reasons to do a full cleanup of the existing file (not start over):

• Historical data is valuable: If the business wants to preserve all its detailed transaction history in one place (for year-over-year comparisons, audit trail, etc.), you’ll lean toward cleaning the existing file. Starting a new file means losing easy access to old transactions and reports in QBO (you’d have to refer to the old file for past info). Many owners prefer to keep continuity.

• Issues are fixable and contained: If the problems, while numerous, are straightforward (like “just need to reconcile and reclassify, but the bones are okay”), it’s often faster to correct what’s there than to rebuild. For example, maybe only the bank recs and a few accounts are off, but most entries exist – that’s very fixable.

• Connected services in place: The existing QBO might be integrated with payroll, payment processors, or third-party apps. A new file means reconnecting everything, potentially re-entering opening data, and maybe losing things like recurring invoices or payroll setup. If the idea of re-establishing all that sounds like more work than cleaning, stick to the old file.

• Taxes already filed on existing data: If prior years in QBO were used for tax filings and those returns are correct, it’s often best to keep that file and just adjust going forward, so you don’t inadvertently mess with prior tax-reported numbers. You can make adjusting journal entries to true up any discrepancies without scrapping the whole file.

Reasons to start fresh with a new QBO file:

• The current file is beyond salvage: Sometimes the data is so corrupt that fixing it would take more time than rebuilding. Examples: years of commingled personal/business transactions, hundreds of unreconciled differences, accounts used incorrectly at scale. If every other number is wrong, a fresh start might actually be cleaner and reduce risk of missing something.

• Clean slate for new year: If it’s near year-end or a new year, one strategy is to pick a cut-off date and start a new file from Jan 1 of the new year, rather than fixing the old year in excruciating detail. You’d bring over the opening balances (like cash, A/R, etc.) as of that date and move forward. The messy prior year data remains in the old file if needed for records, but you don’t touch it (aside from ensuring taxes were handled).

• Prior periods are closed/taxed and not needed in detail: If the business only cares about current and future data, and prior years have been settled, a new file might be acceptable. For example, “Our 2022 and 2023 books are a disaster, but taxes were somehow filed. We just want 2024 onward to be clean.” In such a case, you could leave 2022–2023 as is (maybe export them to Excel for archive), and start a brand new QBO file for 2024 with just the starting Trial Balance. This avoids spending tons of time cleaning years that are already in the rearview mirror.

• Structural issues with the old file: Maybe the old QBO was set up incorrectly (wrong account type, wrong starting date, etc.) or is on the wrong subscription (or even the wrong country’s version). Starting fresh can solve these foundational problems. For instance, if the chart of accounts is completely borked, you might build a new one from scratch rather than attempt to overhaul the existing (especially if combined with other issues).

• Time/cost efficiency: If you estimate that a cleanup would take 100 hours vs. building a fresh file and migrating opening balances might take 20 hours, the latter could be more efficient. However, consider intangible costs like lost detail.

Hybrid approach – partial cleanup, partial fresh start: This is common. You clean what’s necessary and jettison the rest. For example:

• Leave older years alone (don’t fix every little thing in 2022 if we’re in 2025 now and 2022 taxes were filed). Instead, get the December 31, 2022 balances, and ensure that’s your opening for 2023 in the new or existing file, then clean 2023–2024 only.

• Or, use the condense/clean-up utility concept: QBO doesn’t have a built-in “condense” like desktop, but you can mimic it by deleting a lot of old transactions (if not needed) or summarizing them via journal entries for past years, then only detailed in recent years. Some pro advisors will purge all but last 2 years (if the data is just too messy earlier).

If you do start a new file, remember QBO doesn’t let you import transactions easily (only lists like chart of accounts, customers, vendors, products, and beginning balances). There’s a 90-day purge window for new QBO files – beyond that, you can’t wipe data easily. So plan the transition carefully:

• Export key lists from old QBO (accounts, contacts) and import to new to save time.

• Set the new file’s start date (e.g., “as of Jan 1, 2024, we bring forward balances”).

• Enter the opening balances via a journal entry (or multiple entries) – often the Trial Balance from 12/31/2023 becomes the opening balances on 1/1/2024, except you intentionally don’t bring over things that were wrong. You might tweak those numbers to exclude known errors or adjustments that you aren’t carrying forward.

• Keep the old file subscription active in read-only (or export to Excel/PDF all historical reports) so no data is truly lost, it’s just archived.

Communication: If you’re a bookkeeper, explain the trade-offs to the client. They might love the idea of a perfectly clean new file, but make sure they understand they’ll lose comparison ability in QBO unless you manually bring in summary history (you could, for instance, import monthly P&L totals for past years as journal entries so that they have some comparative data in the new file). Often, clients will agree when you frame it like “We can spend X hours (and $Y) to fix the old stuff or start fresh in fewer hours – you’ll lose detailed history in QBO but we can provide that history in reports.” Many opt for saving money/time, as long as compliance isn’t an issue.

In summary, starting fresh is an option best reserved for truly gnarly situations or new periods. Most of the time, a targeted cleanup works and preserves continuity. But don’t be afraid of a fresh start if it’s genuinely the better choice – just do it in a controlled way. Many professionals advise not pouring excessive time into fixing things that have already been reported to tax authorities and are water under the bridge, especially if it won’t benefit the business. Instead, focus on getting things right moving forward.

Hybrid example: One compromise we frequently use: if, say, 2023 and part of 2024 are a mess and 2022 was okay, we might cleanup 2024 fully (current year) and not deeply cleanup 2023. Instead, we’d recreate 2023 in summary form in a new file or in the existing file (like one entry per month for income/expenses) just enough for tax filing and then move on. This way the client isn’t paying for us to correct every transaction that happened two years ago which no one will ever need in detail. We explicitly coordinate such decisions with the tax preparer to ensure no compliance issue.

Bottom line: weigh the cost/benefit. If cleaning the existing file is feasible and valuable, do it. If not, start fresh, but carry forward the essentials so the business can continue smoothly.

Free Download: QuickBooks Cleanup Checklist

(Optional Callout) Cleaning up a QBO file involves a lot of steps and it’s easy to get lost. To help, we’ve prepared a QuickBooks Online Cleanup Checklist that you can download and use as you work through your project. It’s a comprehensive to-do list covering everything from initial assessment to final review, with checkboxes for each step (e.g., “Reconcile all bank accounts through final date,” “Clear old transactions from Undeposited Funds,” “Run A/R aging and address all open items,” “Set closing date,” etc.). This checklist is based on best practices and ensures you don’t miss any critical tasks. Feel free to use it as a guide alongside this article – by the time you check off every item, you’ll have a clean set of books!

(The download link or instructions would be provided here, depending on the platform – e.g., a PDF or spreadsheet available for readers.)

Closing Thoughts: Keeping Your Books Clean Going Forward

Completing a QuickBooks Online cleanup project in 2025 is a significant achievement. You’ve taken chaotic, unreliable books and turned them into accurate financial statements that you or your clients can rely on. But the true value goes beyond one moment in time – it sets the stage for better habits and systems in the future. Here’s how to leverage that fresh start:

• Adopt a Monthly Close Discipline: Make closing the books each month a routine. This means reconciling all accounts monthly, reviewing the P&L and Balance Sheet for anomalies, and addressing issues immediately. A month’s worth of data is manageable; a year’s is overwhelming. By catching up monthly, you ensure errors don’t snowball. QuickBooks Online’s tools like the Bookkeeping Month-End Review are there to guide you – use them.

• Embrace Automation (Carefully): 2025 and beyond will see even more AI assistance in QuickBooks. The AI Accounting Agent can categorize and even reconcile much of your dataquickbooks.intuit.com, and the Business Insights feed will highlight what it’s donequickbooks.intuit.com. Embrace these to save time – for example, let QBO suggest matches and categories, and accept them after a quick review. Intuit is even introducing AI bots to draft emails, find anomalies, and morequickbooks.intuit.comfirmofthefuture.com. However, always maintain that human oversight – automation plus your approval is the winning combination (the AI does the drudge work, you do the thinking).

• Stay Organized with Documentation: Keep digital copies of important documents (bank statements, receipts for major transactions, loan docs) attached in QBO or a secure folder. QBO allows attaching files to transactions – this can be useful if you or an auditor needs to see the source later. It’s easier to maintain order than to recreate it.

• Periodic Professional Review: If you’re a business owner who cleaned up your own books, consider having a proadvisor or CPA review your file at least once a year (if not quarterly). They can run through the Bookkeeping Review or a custom checklist and catch small issues before they grow. This is akin to getting a health checkup for your finances.

• Use QBO’s New Features for Insights: The new KPI dashboards and business insights in QBO can help you monitor your business’s health at a glancefirmofthefuture.com. Set up key metrics (like gross margin, current ratio, etc.) and watch them monthly. If something suddenly looks off, you can investigate right away – possibly preventing a mess. For instance, if you see a trend of declining cash and can’t reconcile it with profit, you might discover early an issue like a billing problem or a bank feed error.

• Plan for Transitions: If you switch bookkeepers or an employee who handles bookkeeping leaves, make sure there’s a handoff. Many messes start during transitions. Use the cleanup checklist as a part of your standard operating procedure – e.g., at year-end or personnel change, run through key tasks to ensure nothing is missed.

• Keep Personal and Business Separate: It’s worth repeating – avoid commingling finances. It’s one of the simplest ways to keep your books cleaner and your life easier. Open that separate bank account or credit card, and if you must pay for something personally, reimburse it to the business properly (or vice versa). This one habit prevents so many headaches.

• Leverage Support and Training: If you’re unsure about something in QuickBooks, use the support resources. QBO’s help articles (many cited here) are great, and there’s a community of users and experts (plus your accountant). Intuit also provides webinars like “In the Know” for new featuresfirmofthefuture.com. Staying informed on updates (like the ones in 2025) means you’ll use QBO to its full potential, and perhaps avoid mistakes by using features correctly.

• Consider Ongoing Bookkeeping Services: As a plug – if you realized during this process that bookkeeping isn’t your favorite task, consider outsourcing it to a professional on an ongoing basis. The cost is often far less than the cost of another big cleanup down the line, and it frees you to focus on your business. Intuit’s QuickBooks Live Bookkeeping or a local ProAdvisor are options. Think of it like maintenance on a car – regular oil changes vs. fixing a broken engine.

By cleaning up your QBO file and implementing these forward-looking practices, you’ve essentially given your business a fresh financial start and a system to stay on track. The Ultimate Guide we’ve provided here can be your reference – not just for the cleanup itself, but for avoiding the need for one in the future. With accurate books, you can plan better, sleep easier around tax time, and have confidence when someone (banker, investor, auditor) asks for your financials.

Your books are clean – keep them that way, and they will reward you with insights and peace of mind. Happy bookkeeping in 2025 and beyond!

Sources:

• QuickBooks Online Cleanup Course & Checklist (BurnsBooks example)

• Intuit QuickBooks Help & Updatesquickbooks.intuit.comquickbooks.intuit.comfirmofthefuture.comfirmofthefuture.cominsightfulaccountant.com

• One 8 Solutions & Firm of the Future (QBO 2024–2025 new features)firmofthefuture.comquickbooks.intuit.comfirmofthefuture.com