Even when transactions exist in your books, that doesn’t mean they’re recorded correctly.
Phase 3: One-Time Adjustments That Bring Accuracy Back
This phase focuses on cleaning what’s already there:
- Duplicate transactions
- Missing expenses or income
- Transactions posted to the wrong accounts
For example:
- Renovation costs recorded as wages
- Equipment purchases booked as payroll
- Duplicate bank pulls inflating expenses
These errors don’t just affect reports—they directly impact taxable income.
Why Classification Errors Cost You Money
Misclassified expenses can:
- Overstate payroll
- Understate deductions
- Inflate taxable income
Missing transactions are even worse—they represent deductions you never claimed.
One-Time Adjustments vs Ongoing Entries
Cleanup adjustments are not recurring journal entries.
They are one-time corrections designed to:
- Align books with reality
- Reset balances properly
- Allow clean reconciliation going forward
Once adjustments are made and reconciliations are complete, your books finally start telling the truth.
Video: Fix Your Bookkeeping Errors (in 4 Phases): https://www.youtube.com/watch?v=q7OTII9W6eE
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