Monthly Bookkeeping Checklist for Canadian Small Businesses

Why Monthly Bookkeeping Matters

The difference between businesses that thrive and those that struggle often comes down to one thing: financial visibility. Monthly bookkeeping gives you that visibility — accurate, timely data about your revenue, expenses, and cash position.

Leaving bookkeeping until year-end is like driving across the country with your eyes closed, then opening them only when you arrive. By then, the course corrections are impossible.

This checklist covers every task that should be completed during the monthly bookkeeping cycle for a Canadian small business. Use it as a guide — or as the standard we hold ourselves to at Outsource Bookkeeping.

Weekly Tasks (Throughout the Month)

Before the month-end close, these tasks should happen on an ongoing weekly basis:

1. Enter and categorize transactions Log all income and expenses in your accounting software (QuickBooks Online or Xero). Categorize each transaction to the correct account (office supplies, professional fees, advertising, etc.). Consistent categorization is the foundation of meaningful reports.

2. Collect and attach receipts Attach digital copies of receipts to each transaction. This is a CRA requirement — you must be able to substantiate every business expense. Use a receipt scanning app (Receipt Bank, Dext) or take photos and upload directly to QuickBooks.

3. Issue invoices promptly Invoice clients as soon as work is completed. Every day you delay is a day added to your collection cycle.

4. Follow up on outstanding invoices Review your accounts receivable weekly. Send reminders for invoices over 30 days. Cash flow is a function of both billing and collecting.

Month-End Checklist (by the 5th of Following Month)

Bank and Credit Card Reconciliation

• ●[ ] Reconcile all business bank accounts against your bank statement
• ●[ ] Reconcile all business credit cards against statements
• ●[ ] Identify and investigate any discrepancies
• ●[ ] Record any bank fees, interest charges, or automatic payments
• ●[ ] Confirm opening and closing balances match the bank statement exactly

Bank reconciliation is the most important month-end task. It catches data entry errors, identifies missing transactions, and confirms the integrity of your financial records.

Accounts Receivable Review

• ●[ ] Run an Accounts Receivable Aging report
• ●[ ] Follow up on invoices 30+ days overdue
• ●[ ] Record any cash receipts that arrived this month
• ●[ ] Write off any uncollectable invoices (with owner approval)
• ●[ ] Confirm unearned revenue is properly tracked for subscriptions or prepayments

Accounts Payable Review

• ●[ ] Enter all bills received this month
• ●[ ] Record all payments made to suppliers and vendors
• ●[ ] Review for any duplicate payments
• ●[ ] Confirm all payroll costs are recorded

HST/GST Tracking

• ●[ ] Confirm all taxable and exempt revenues are correctly classified
• ●[ ] Verify all Input Tax Credits (ITCs) are captured on purchases
• ●[ ] Calculate running HST balance (amount collected minus ITCs)
• ●[ ] Set aside HST owing in a dedicated savings account (best practice)
• ●[ ] If quarterly filer: confirm whether a filing is due this month

Payroll Verification

• ●[ ] Confirm payroll was processed correctly
• ●[ ] Record all source deduction remittances to CRA
• ●[ ] Reconcile payroll expense to payroll records
• ●[ ] Record any accrued vacation pay

Asset and Liability Review

• ●[ ] Record any new equipment purchases (set up as capital assets, not expenses)
• ●[ ] Record any loan payments and split between principal and interest
• ●[ ] Record depreciation/amortization on capital assets
• ●[ ] Update prepaid expense and accrued liability schedules

Revenue Recognition

• ●[ ] Confirm all completed jobs or delivered services are invoiced
• ●[ ] Record any revenue received in advance as unearned revenue
• ●[ ] Adjust for any project percentage-complete revenue recognition
• ●[ ] Record any credit notes or customer refunds

Month-End Reports to Review (by the 10th)

Once all the above tasks are complete, your bookkeeper should provide:

1. Profit & Loss Statement (Income Statement) Shows your revenue, expenses, and net income for the month and year-to-date. Compare to the same period last year. Ask: Is revenue growing? Are expenses in line with budget?

2. Balance Sheet Shows your assets, liabilities, and owner's equity at month-end. Monitor: accounts receivable aging, cash balance, outstanding loans. The balance sheet tells you what your business is worth today.

3. Cash Flow Statement Shows actual cash movements — not just profits on paper. A business can be profitable but cash-negative if clients are slow to pay. Review: operating cash flow, changes in working capital, upcoming cash requirements.

4. HST/GST Summary Shows HST collected, ITCs claimed, and net amount owing for the period. Useful for planning quarterly remittances.

CRA Filing Deadlines to Track Monthly

• ●Source deductions (payroll remittances): Due 15th of following month for regular remitters
• ●HST/GST (quarterly filers): Due 1 month after quarter-end
• ●HST/GST (annual filers): Due 3 months after fiscal year-end
• ●T4/T5018 slips: Due last day of February each year

The Cost of Not Doing Monthly Bookkeeping

Business owners who skip monthly bookkeeping typically face: - CRA penalties for late HST filings (up to 20% of amount owing) - High accountant fees for year-end cleanup ($150–$400/hour) - Missed write-offs discovered after the tax year closes - Poor business decisions made without accurate financial data - Cash flow surprises that could have been anticipated and avoided

Let Us Handle This For You

This checklist represents the work Outsource Bookkeeping performs every month for our clients — delivered to your inbox by the 10th, every month, guaranteed. Flat rate $500/month, no surprises.

Book a free 30-minute consultation to see how we can take your monthly bookkeeping completely off your plate.