Month-End Accounting for Small Business Owners

Month-end accounting is the work of closing and reviewing everything that happened in your business during a completed month, so you know four things: what the business actually earned, what it spent, what it owes, and how much cash it has available. Each month, Esti reconciles your bank, credit card, sales and payroll activity, prepares financial statements from the cleaned-up data, and then goes through those statements with you in ordinary words. EENACCOUNTINGANDTAXRESOLUTION LLC works with small business owners throughout the United States, and the review happens on a scheduled Zoom call so you can ask questions while the numbers are still in front of you.

Most accountants see a small business owner once a year, when the return is due. This service runs every month instead. By the time filing season arrives, twelve months of activity have already been reconciled, reviewed and discussed, so nothing has to be reconstructed from a folder of receipts and half-remembered transfers. You also spend the year making decisions with current information rather than with last year's tax return.

A typical monthly close takes about 5 to 10 hours of work, depending on how many bank and credit card accounts you carry, your transaction volume, whether you run payroll, and whether you collect sales tax. The work starts once the month has closed and your statements are available, and your review call is scheduled after the numbers are finished.

Every monthly close includes four reconciliations (bank, credit card, sales and payroll), a set of financial statements built from those reconciled records, and a review conversation where the statements get explained. The reconciliations come first because a profit and loss statement is only as good as the data behind it. If deposits are double counted or a credit card was never matched to its statement, the report will look tidy and still be wrong.

The statements are walked through with you line by line, in plain language, on a scheduled call after each close. Esti does not just hand over a monthly profit and loss and leave you to interpret it. The review covers what changed since last month, what caused the change, and what it means for the cash you have to work with. Questions get answered in ordinary words, and there is no expectation that you already know accounting terminology.

Owners usually come to the review with practical questions, and those are the ones the close is designed to answer. Why did the month show a profit while the bank balance dropped. Whether a rising expense line is a one-time purchase or a permanent increase. How much of the cash on hand is really yours versus payroll taxes and sales tax you are holding for the agencies. Whether the business can absorb another hire, a piece of equipment, or a larger draw.

The review also flags problems while they are still small. A customer balance that has been sitting unpaid for months, a credit card that is quietly growing, a payroll liability that was not deposited, a duplicate subscription still charging every month. Catching those in the month they happen is a great deal easier than untangling them in the spring.

Because your income and expenses are current every month, tax planning can happen while there is still time to act instead of after the year has closed. Esti uses your monthly financial information to look ahead at where the year is heading, so you can see a likely tax position during the year rather than learning about it when the return is prepared. Decisions that affect the tax outcome, such as timing an equipment purchase, adjusting owner compensation, or setting aside money for estimated payments, are discussed with real numbers in hand.

Year-end tax preparation is handled in the same practice. Returns are prepared and completed for S-corporations, partnerships and individuals, which means the person who reconciled your books all year is the person filing from them. There is no handoff, no request for records you already sent, and no reconciliation work being done for the first time under a filing deadline.

Month-end accounting reports on activity that has already happened. Budgeting and forecasting are not part of this service, so the monthly close is not a projection model. What it does provide is an accurate picture of the current year, updated every month, which is what the tax planning conversations are based on.

Payroll tax and sales tax are handled as part of the year-round work, not treated as separate emergencies. These are the two areas where small businesses most often get into trouble, because the money involved was never really the business's to spend. Sales tax you collect belongs to the state, and payroll withholding belongs to the taxing agencies. When those amounts are tracked every month, you know what portion of your bank balance is already committed.

Each close checks payroll liabilities against deposits made and confirms sales tax collected against what has been reported and remitted. If a filing was missed or an amount was underpaid, it shows up in that month's review with an explanation of what needs to happen next. Notices about payroll or sales tax are reviewed with you the same way as any other agency correspondence.

Send it over and do not ignore it. Esti is an Enrolled Agent, an IRS-authorized tax professional with federal representation rights, which means she can communicate with the IRS on your behalf where EA authority applies. The first step is reading the notice together: what the agency is asking for, which tax year and which return it concerns, what the deadline is, and whether the amount stated is even correct. Many notices come down to a missing form or a payment applied to the wrong period.

From there, you get a plain explanation of the options and what each one requires from you. Esti can respond to the agency, provide the documentation they are asking for, and represent you in that correspondence rather than leaving you to write letters and wait on hold. Outcomes depend on the facts of your case and on the agency, so nothing is promised in advance. What is certain is that you will not be handling it alone or guessing at what the letter means.

Existing monthly clients have an advantage when a notice shows up, because the records the agency wants are already reconciled and organized by month. Documentation that would otherwise take weeks to assemble is usually already in place.

That is a normal starting point, and it is exactly the kind of work this practice takes on. Do not worry if your books are not perfect. Most owners who call have some combination of unreconciled accounts, mixed personal and business spending, categories that were guessed at, and a stretch of months nobody has touched. None of that has to be fixed before you get in touch.

If there are unfiled returns or several years of unresolved problems, the first job is establishing what actually needs to be done. That means identifying which years and which filings are outstanding, what records exist, and what has to be rebuilt. You get a clear explanation of the situation and a plan to work through it in order, rather than a vague sense that something is wrong. No problem is too big or too small to bring to the conversation.

Once the backlog is caught up, the monthly close keeps it from happening again. The reason books fall behind is usually that nobody was closing the month, so small discrepancies accumulated until the whole year looked unapproachable. A recurring monthly review stops that cycle at the point where it is still a few transactions.

The service is delivered remotely to small business owners anywhere in the United States, and every meeting is held on Zoom. Appointments are available on weekday evenings from 6 PM and any time on Saturday or Sunday. Documents are exchanged securely, the close is completed after your month ends, and the review takes place on a scheduled call, so your location does not limit who handles your books.

Each month follows the same sequence. You send or share the statements and payroll records for the closed month, Esti completes the reconciliations and prepares the financial statements, and then you meet to go through them. Between closes, questions do not have to wait for the next scheduled call. Reaching Esti during the year is part of the arrangement, and that is the main difference between year-round accounting and an annual tax appointment.

Book a consultation and bring your most recent bank statements, any payroll reports, and any notice you have received. The first meeting is a straightforward look at where your books stand today, what the monthly close would cover for your business, and what needs to be caught up before the recurring work begins. You will get direct answers about scope and timing before committing to anything.

An introductory rate is currently available for a limited number of small business clients who sign up for monthly accounting services, and the details are covered during the consultation. EENACCOUNTINGANDTAXRESOLUTION LLC is led by Esti, an Enrolled Agent with federal representation rights, and holds memberships with the National Association of Enrolled Agents and the Worldwide Women's Association.

Clients tend to describe the working relationship in simple terms. As B. Marcote put it: "You are the best! Thank you for helping me as much as you do!" To get started, call 1(917)623-4217 or email esti@eenaccountingandtaxresolutionllc.com to book an appointment.