Year-End Checklist for QuickBooks

The checklist certainly does not cover everything required to put 2010 to rest, but it's a good general start.

Reconcile

Reconcile all of your bank and credit card accounts with your December statements to ensure all of the balances in your QuickBooks accounts are correct and ready for tax preparation. If you reconcile every month, this task is 99% done by the end of the year. When making loan payments, be sure to check that the amounts going to principal and interest are accurate when you enter the payment every month. The result is that at the end of the year it takes only a minor adjustment, if any, to get the principal balance to match your bank's loan statement balance.

Report

Print and proof reports for your files: Profit & Loss and Balance Sheet reports are essential. In addition to your digital records, have file copies of your year-end business reports printed. These printed records are a good quick reference if you want to compare one year to another. Natural disasters, fires, and thefts of computer equipment, all of these things make our computer records vulnerable and having that printed information could be very important to you in the future. Giving your accountant copies is also a good backup plan.

Backup

Make two backups of your QuickBooks company file. Store one copy off-site in a secure location. You should definitely have a backup procedure in place for all of your computer records. To determine how far you will want to go with your backup procedures, think about how painful it would be to lose all of your data and then backup accordingly. One method I recommend is to purchase multiple thumb drives and label them for different days of the week, to give you a series of "rolling backups" in the event one of your storage devices fail. Another method to use is an online backup service. I use Mozy.com to backup my computer files online. Each morning Mozy leaves me a screen open to confirm that my files were backed up to a website while I slept. Mozy also leaves a reassuring green checkmark next to every backed up file and folder. Using multiple storage devices and having some type of off-site storage are the main components of a good backup program.

Taxes

Print and mail your W-2/W-3, 1099, 940/941 and 1096 tax forms. Go through your Vendor list and double-check that all of your vendors who require 1099s are set up with 1099 vendor status and that you have their social security numbers. QuickBooks will print all of your 1099s and the 1096 reporting form for you. You can purchase the government required forms for a nominal price from any office supply store. QuickBooks does an excellent job with all of your payroll reporting forms also.

Data Integrity

Ensure your data integrity. As your data file gets large (in excess of 50 MB), you might encounter corruption. Problems are much easier to fix when they're caught early and still small, so follow these easy steps to check the integrity of your data. It's a great idea to do this when backing up your files. Close all windows, then use File > Utilities > Verify Data to verify your data integrity. If verification fails, it will give you instructions on the screen for how to proceed.

If you are instructed to run the Rebuild, go to File > Utilities > Rebuild (this will require you to make a back-up). After the rebuild finishes, run Verify again. Recently, we have had several customers have issues with some of their lists looking incomplete even after verifying their data. Running the Rebuild corrected the lists even though QuickBooks did not indicate their data was corrupted. I suggest running the Rebuild tool monthly after a backup just to keep your data in good shape.

File

A complete printed set of file folder labels is available from your QuickBooks Company File. Simply click File > Print Forms > Mailing Labels to set up the specifications. I set up my file folders right away with these labels for the companies I know I will need and then store the rest in a folder at the front of my files for companies I am not sure I will be using that year. I keep two years of folders in my office for easy access. I have seven large plastic tubs in my attic for previous year's records. At the end of each year, I empty the oldest tub, retaining tax and payroll records, and put the most recently retired records in it and send it back to the attic.