CPA Firms Houston Alternative closes the month
We close the month by making the bank, the cards, and the uncleared items tell one story you can read.
Start this monthWhat a closed month contains
A closed month has a beginning balance that matches the last close, a list of deposits that each have a category, and a list of payments that each have a payee. The bank statement is checked line by line. Anything that has not cleared stays on the reconciliation instead of being forced to zero.
Cards get the same treatment. A charge without a receipt is not dropped. It sits in a short list until you say what it was, or until we agree it is personal and should come out of the business. Mixing those two is how a later return argues with the bank.
We write the statements from that close. A profit figure that does not trace to the reconciled cash is not a figure we will hand you. If the month cannot close, we say what is missing and we stop there.
Catch up is the same motion
If several months are open, we start at the oldest one that lost the thread. Rebuilding six months is six closes, not a special project with a new vocabulary. Each month has to stand before the next one begins, because a wrong beginning balance poisons everything after it.
You do not have to arrive with a perfect file. You do have to be willing to answer what a deposit was. We can group the questions so you are not asked one at a time for a year. We cannot categorize a wire from a name neither of us recognizes.
Every Texan knows the inner belt people call the Loop, the ring that marks the old core. We can all appreciate that loop the way you do. We look at a year of open months and ask which one inside the pile still needs a beginning balance before the rest can move.
How the month reaches the return
The return follows the closed months. Those months are added up, with the adjustments the year still allows. If October is still open, the return waits on October. We would rather close that month than estimate it.
Owner pay, reimbursements, and draws need a consistent treatment all year. Changing the label in December does not change what the bank shows. We pick the treatment early, write it the same way each month, and let the return follow.
When you want this started, tell us the last month you trust and the month you are in now. We will say whether we begin with a catch up or with the current close, and we will quote that work before we touch the file.
What the list looks like
The reconciliation we hand back is a short list, not a speech. Each line names the date, the amount, and the reason it is still open. A deposit with no category stays on the list. A check that has not cleared stays on the list. When you answer a line, it leaves the list and the balance moves. That is the whole rhythm of a catch up, repeated until the oldest open month is done.
We also mark transfers between your own accounts so they are not treated as new income. Owners often have two or three accounts and a card that pays the same vendors. If those movements are counted twice, the month looks busier than the cash was. The list is where that double count gets caught, while you still remember which account funded which bill.
After the list is quiet, the statements are a reading of it. Profit, cash, and what you owe the agencies should point at the same month. If they do not, we are not finished, and we do not send the statements ahead of the fix. You can ask for the list at any point. It is the work, not a side report.
A deposit that arrived in a lump
The card processor often sends one deposit for a whole day of sales. The books still need that day's sales, the fees, and any tips pulled out of the lump. Post the lump as plain income and the fees vanish, so profit sits high by the fee amount. We split the lump during the close. Then the bank line and the sales report can both be true.
Tips the staff already took in cash are easy to leave out. When the processor report shows tips and the drawer does not, the month has a hole the size of those tips. Tell us how tips actually move on your floor. We code them the way the floor works, rather than inventing a clearing account nobody recognizes.
A refund that hits a later month is the other common lump. A March sale and an April refund should not both disappear. The April refund reduces April. The March close stays as it was on the day you accepted it, with a note that points forward.
The month you have
Name the last month you trust and the one you are in. We will say how the close would start.
You will be talking to the Steven Palmieri practice.
