Defining Bookkeeping Terms: Clean-Ups, Catch-ups, and Setups
Graphic - Orca Accounting Blog #3 - Defining Bookkeeping Terms: Clean-Ups, Catch-ups, and Setups
Hi there! Welcome and thank you for joining us for Blog #3.
If you’ve been in business for a while, you’ve probably heard terms like clean-up and catch-up floating around, especially when people talk about bookkeeping. But what do they actually mean? When do you need one versus the other?
We’re going to answer these questions today. Whether you’ve been managing your books yourself and know there are errors, just got behind, or are ready to hand things off to a professional, this post will help you understand what each process looks like, and why it’s the first step toward clean, confident finances.
What Is a Bookkeeping Clean-up?
A clean-up is exactly what it sounds like: it’s when you make sure your historical bookkeeping data is complete, accurate, and fully reconciled.
Think of it like doing a full monthly close, but for all the months that haven’t been reviewed or filed yet.
This usually comes into play if
You’ve been doing your own bookkeeping and things got a little out of order.
You’re switching accountants or software and want to make sure everything lines up before moving forward.
During a clean-up, we look at everything that’s happened historically. Every transaction, reconciliation, adjustment, and balance. We want to make sure it reflects reality, and the documentation supports it. The goal is that when your clean-up is done, your books are correct, consistent, and ready for accurate financial reporting or tax filing.
What a Clean-up Really Involves
A proper clean-up goes beyond just “fixing numbers.” It’s a deep review of how your bookkeeping is structured and whether it supports your business needs. Here are a few key parts of that process:
Chart of accounts review: Your chart of accounts is like the backbone of your financial system. During a clean-up, we make sure it actually reflects your business and is organized in a way that gives you clarity instead of confusion. If your chart of accounts was copied from a template or set up years ago, it might not fit your business anymore.
Bank feeds and automation: If possible, we make sure all your bank feeds are connected and functioning correctly, and that your automations are running smoothly.
Reconciliations and financial statement review: Every balance sheet account (bank, credit card, loan, or liability) gets checked and reconciled so the balance sheet is complete, accurate, and matches what really happened.
A clean-up is also a great opportunity to tighten up processes and technology. Maybe you’ve been doing everything manually in spreadsheets and you’re ready to switch to Xero or Quickbooks. Or maybe your software is already set up, but your integrations and automations aren’t optimized yet.
The goal of a clean-up is to take everything that’s been wrong, messy, or unclear, and present it correctly, cleanly, and confidently, with documentation to match.
DIY vs. Hiring It Out
A clean-up is definitely something you could do yourself, if you have the time, patience, and technical know-how to do it accurately. However, it is most often something that business owners outsource.
Here’s why:
Time. It’s done faster.
Completeness and accuracy. Replace guesswork with expertise.
Stress. The time you spend learning, stressing, and doing, could be spent focusing on your business.
It really comes down to how much time you want to invest in your books versus in your business. A professional clean-up gives you confidence that everything is correct and sets you up for success going forward.
What About a Setup?
Sometimes, you don’t just need a clean-up, you need a setup.
New business owners often come to us saying, “I signed up for QuickBooks, but now what?” They’ve bought the software but don’t know where to start.
That’s where a setup comes in. During a setup, we:
Customize your chart of accounts so it fits your business model.
Connect your bank feeds and payment processors.
Integrate your key apps (like payroll, invoicing, or CRM tools).
Ensure your automations, categories, and reporting are working properly.
A professional setup saves you from having to redo everything later. It’s like laying a strong foundation, so when you or your accountant start maintaining your books each month, everything flows smoothly.
What Is a Catch-Up?
Now, let’s talk about catch-ups, because they’re often mentioned in the same breath as clean-ups, but they’re slightly different.
A catch-up is when your books are accurate but behind. Maybe everything looks good through March of last year, but April through December still needs to be entered and reconciled.
In that case, you don’t need a clean-up, since nothing has been entered for a given time period. You just need to bring everything up to date.
Catch-ups are usually more straightforward than clean-ups, but just as important. Once your books are caught up, you can finally see how your business has been performing, prep for taxes, or make confident financial decisions.
A catch-up fills in the gaps. A clean-up fixes what’s wrong.
Sometimes It’s Best to Start Fresh
Sometimes, during a clean-up, it becomes clear that starting from scratch is actually faster and cleaner.
If the existing data is too messy, inaccurate, or inconsistent, it might be more efficient to create a new file, design a clean chart of accounts, and rebuild your books from the ground up.
We love projects like this. They're the perfect blend of a clean-up, catch-up, and setup. You get the clarity of a fresh start and the accuracy of knowing your past data is correct.
Why All This Matters
Clean-ups and catch-ups might not sound glamorous, but they’re the unsung heroes of solid financial management.
When your books are accurate and up to date, you can:
Trust your numbers when making business decisions.
Stay compliant with tax and filing deadlines.Avoid surprises during audits or financing.
And most importantly, have peace of mind knowing your financial foundation is strong.
It’s also the first step before moving into higher-level strategy, like CFO services, forecasting, or cash flow planning. None of that can happen reliably if your data isn’t clean.
Final Thoughts
If your books have fallen behind or you’re not sure they’re accurate, allow yourself some grace. It is common for businesses to reach a point where they need a clean-up or a catch-up. It is one of the sure signs of growth!
This all being said, whenever historical bookkeeping is being addressed, you want to be absolutely sure that whoever is doing so is adhering to best practices while handling your past records. If you are curious about what these best practices are, and how to do so, feel free to reach out at the links below.
Clean-ups fix what’s wrong. Catch-ups bring you up to date. Setups give you a strong start. Together, they set the stage for clarity, confidence, and growth in your business.
Whether you want to tackle it yourself or hand it off to a pro, the important thing is to get your books back on track so they can start working for you, not against you.
Ready to Get Bookkeeping Off Your Plate?
Hi! I’m Leah — an ex-corporate senior accountant. I work with startups, small, and medium-sized businesses in a variety of industries (e-commerce, consulting, retail, health, fitness and wellness, construction, real estate, to name a few).
I take the accounting side of running a business off your hands. Whether you are doing it yourself and want to save yourself a headache, or your current setup just isn’t cutting it, I’m here to make this process feel a bit more easy, modern, more hands-off, and more stress-free.
“Where can I learn more about you?”
Learn more about my bookkeeping services: orca-accounting.com/#services
Schedule a consultation: orca-accounting.com/contact
Want to get a feel for how I work?
→ Podcast: The Accounting Edit
