Your Mid-Year Bookkeeping Checklist: 5 Fast Fixes That Streamline Operations

Mid-Year is the Time to Get Your Books in Order

If you’re like most small business owners, the start of the year was a blur—new clients, new hires, and maybe even new tools or equipment. By the time summer rolls around, it’s easy to fall behind on bookkeeping, leaving you scrambling come tax season or financial reviews.

That’s why now is the perfect time to pause and run through a mid-year bookkeeping checklist. Whether you’re doing your own books or working with a pro, these 5 fast fixes will help you clean up errors, improve cash flow, and streamline operations for the rest of the year.

Let’s dive in.

Section 1: Why a Mid-Year Bookkeeping Checklist Matters

According to the Small Business Administration, more than 50% of small businesses fail within the first five years—and one of the top causes is poor financial management.

Skipping over your books now means:

• Surprises at tax time

• Missed deductions

• Cash flow issues during slower months

• Inaccurate pricing decisions

On the flip side, a mid-year checkup helps you:
✅ Catch errors early
✅ Make strategic decisions based on actual numbers
✅ Avoid penalties and prepare for Q3/Q4 growth

Section 2: Bookkeeping Checklist—5 Fast Fixes for Better Operations

✅ Fix #1: Reconcile Bank and Credit Card Accounts

Why it matters:
Bank reconciliations ensure your books match your actual cash in the bank. Skipping this step means your financial reports could be completely off.

How to do it:

• Use QuickBooks Online or another software to match each bank transaction with your recorded expenses/income.

• Investigate any discrepancies (duplicates, missed charges, unrecorded deposits).

• Do this monthly at minimum—mid-year is a great time to catch up if you’ve fallen behind.

Pro Tip: Set up automatic bank feeds so transactions sync daily and reduce manual entry errors.

✅ Fix #2: Categorize All Expenses Properly

Why it matters:
Misclassified expenses can skew your profit & loss reports and cause you to miss out on legitimate tax deductions.

What to look for:

• Are office supplies, tools, and mileage correctly categorized?

• Are personal expenses creeping into your business account?

• Are all subcontractor payments logged under contractor services?

IRS Insight: Businesses must keep accurate records for at least 3 years after filing tax returns—improper classification can trigger audits.

How to fix it:
Run an “uncategorized expenses” report in your accounting software and update all unknown or misfiled transactions.

✅ Fix #3: Review Your Accounts Receivable

Why it matters:
Unpaid invoices can cripple cash flow. Mid-year is the perfect time to assess your A/R and update your collections process.

Steps:

1. Run an “Aged Receivables” report.

2. Identify customers past 30/60/90 days overdue.

3. Follow up on outstanding balances.

4. Consider requiring deposits or milestone payments going forward.

Stat to Know: According to a U.S. Bank study, 82% of small businesses fail due to cash flow issues, not lack of profit.

Pro Tip: Use software like QuickBooks Payments or Melio to send reminders and allow ACH or card payments directly.

✅ Fix #4: Run a Mid-Year Profit & Loss (P&L) and Balance Sheet Review

Why it matters:
Your P&L and Balance Sheet are your financial health check. At mid-year, these reports help you:

• Compare actual vs. projected revenue

• Assess overhead and pricing accuracy

• Decide whether to ramp up, slow down, or pivot

Checklist for P&L Review:

• Are your cost of goods sold (COGS) margins still healthy?

• Which services or products are most/least profitable?

• Are payroll and subcontractor costs in line with growth?

Checklist for Balance Sheet Review:

• Are your assets (tools, vehicles) accurately listed?

• Is your loan balance correctly tracked?

• Are liabilities (credit lines, taxes owed) current?

Tip: Share your mid-year reports with your bookkeeper or CPA for feedback before Q3 starts.

✅ Fix #5: Review Your Chart of Accounts and Clean Up Your Categories

Why it matters:
A messy chart of accounts leads to cluttered reports and confusion. As your business grows, you may have redundant or outdated accounts.

What to look for:

• Duplicate expense categories (e.g., “Fuel” and “Gas”)

• Outdated vendor accounts

• Inactive customer or project listings

• Unused classes or locations in QuickBooks

How to fix it:

• Merge duplicate accounts

• Archive unused categories

• Consolidate where appropriate (e.g., instead of 10 types of office expenses, keep 3 logical categories)

Outsource Tip: Bookkeepers at Out of the Box Technology offer QuickBooks cleanup services to streamline your chart of accounts for more accurate, actionable reporting.

Section 3: Bonus Tips for Smarter Bookkeeping in the Second Half of the Year

Automate Recurring Transactions

• Set up rules in QuickBooks to auto-categorize monthly software subscriptions or utility bills.

• Saves time and eliminates manual errors.

Backup Your Data

• Ensure you’re backing up your books—especially if using desktop software.

• Use cloud-based tools or enable automatic backups.

Revisit Your Pricing and Profit Margins

• Rising supply costs or fuel expenses? Your books can help you decide when and how much to increase pricing.

• Compare first-half COGS to last year’s to make smart adjustments.

Section 4: Real Example—How a Cleaning Business Used a Mid-Year Bookkeeping Checklist to Grow 25%

One of our clients—a growing cleaning company in Ohio—was struggling with cash flow despite steady bookings. During a mid-year review, we discovered:

• $12,000 in overdue invoices

• Unclassified expenses that weren’t deducted at tax time

• Inaccurate job costing

After implementing the bookkeeping checklist, they:

• Recovered $9,800 from follow-ups on late payments

• Increased profit margins by 8% through pricing adjustments

• Streamlined categories for better forecasting

By year-end, they had grown revenue by 25% without hiring additional staff—just by working smarter with cleaner books.

Section 5: Tools That Help You Tackle This Checklist

FAQs: Bookkeeping Checklist for Small Businesses

How often should I reconcile my accounts?

Ideally, monthly—but at least quarterly. Mid-year is the perfect time to catch up on reconciliations and fix any errors before they compound.

What’s the difference between a P&L and a Balance Sheet?

• A Profit & Loss (P&L) statement shows income and expenses over a specific period.

• A Balance Sheet shows your assets, liabilities, and equity at a specific point in time.

Can I write off uncollected invoices?

Yes, but only if you use accrual accounting and have made a good-faith effort to collect the debt. Consult with your accountant to write it off properly.

How do I clean up my chart of accounts?

Review all accounts for duplicates, unused categories, and inconsistencies. Merge or delete where needed. QuickBooks and Out of the Box Technology can help streamline this process.

Should I automate any parts of my bookkeeping?

Absolutely. Automating expense tracking, invoicing, and payments helps reduce human error and saves time—especially for recurring transactions.

Final Thoughts: Small Fixes Now Prevent Big Problems Later

Taking just a few hours to work through your mid-year bookkeeping checklist can save you dozens of hours—and thousands of dollars—down the road. You’ll gain:

• Clearer financial visibility

• Fewer surprises at tax time

• Improved operational efficiency

• Peace of mind heading into the second half of the year

Need Help Cleaning Up Your Books?

At Out of the Box Technology, we specialize in QuickBooks cleanup, monthly bookkeeping, and ongoing financial support for home service businesses. Whether you need help reconciling accounts or want expert insights on your financial reports, our team is here to help.

For those seeking expert guidance, Out of the Box Technology offers tailored bookkeeping services, QuickBooks setup, and support to ensure your business runs smoothly and stays compliant.