What Bookkeeping Tasks Are Performed on a Monthly Basis?

Keeping up with bookkeeping is essential to running a successful business, and consistency is key. While some bookkeeping tasks are done daily or annually, there are several important tasks that should be completed on a monthly basis to keep your financial records accurate and up to date. Let’s walk through the key bookkeeping tasks you should tackle each month to keep your business on track.

1. Reconcile Bank and Credit Card Statements

One of the most important bookkeeping tasks is reconciling your bank and credit card statements. This means comparing your accounting records with your bank and credit card statements to ensure all transactions match. Doing this helps you:

Identify discrepancies or fraudulent charges
Catch errors before they become bigger issues
Ensure your cash flow records are accurate

2. Record and Categorize Transactions

Every transaction that occurs in your business—whether it’s an expense, income, or transfer—needs to be properly recorded and categorized. Using accounting software can make this process easier, but if you’re handling it manually, be sure to:

Assign transactions to the correct income or expense category
Keep detailed records for tax purposes
Ensure all cash, check, and credit card payments are accounted for

3. Review Accounts Payable (Bills You Owe)

Keeping track of your unpaid bills ensures that you maintain good relationships with vendors and avoid late fees. Each month, review your accounts payable and:

Pay outstanding invoices on time
Track due dates to avoid late payment penalties
Verify that all invoices are accurate before making payments

4. Review Accounts Receivable (Money Owed to You)

Just as you need to stay on top of what you owe, you also need to track what customers owe you. Reviewing accounts receivable helps you:

Identify overdue invoices
Send reminders to clients for unpaid bills
Maintain a healthy cash flow

5. Process Payroll

If you have employees, payroll processing is a crucial monthly task. Depending on your payroll schedule, this may be a biweekly or monthly task, but at minimum, each month you should:

Calculate employee wages and deductions
Pay employee salaries and payroll taxes
File payroll reports as required

6. Review Financial Reports

Monthly financial reports give you insight into how your business is performing. Important reports to review include:

Profit & Loss Statement: Shows your income and expenses, giving a snapshot of profitability.
Balance Sheet: Provides a summary of assets, liabilities, and equity.
Cash Flow Statement: Helps you understand where your cash is coming from and going.

Analyzing these reports helps you make informed business decisions and identify areas for improvement.

7. Track and Record Sales Tax

If your business collects sales tax, you need to ensure that you’re tracking and recording it correctly each month. This makes tax filing easier and ensures compliance with state and local tax laws.

8. Organize and Backup Financial Records

Keeping financial records organized is essential for tax preparation and audits. Each month, you should:

Digitally store receipts, invoices, and statements
Keep physical copies of important documents when necessary
Backup your accounting software or cloud-based records

9. Plan for the Future

Bookkeeping isn’t just about keeping track of past transactions—it also helps you plan ahead. Use your monthly financial insights to:

Set budgets for the upcoming months
Identify potential cash flow issues
Make strategic business decisions

Final Thoughts

Staying on top of monthly bookkeeping tasks helps keep your business financially healthy and organized. Whether you handle bookkeeping yourself or work with a professional, completing these tasks regularly will save you time, reduce stress, and help you make smarter financial decisions. So set aside some time each month, stay consistent, and keep your business finances in great shape!