USA Start Over - My Books Are A Mess

[dono2081]

The records (books) for my 20 year old C corp are a big mess; the bookkeepers have booked expenses in random accounts, income has been overlooked, and loans I've made to the business have not been entered properly.

I'm tempted just to start over, but I've been in business for 20 years. Is there a better way?

Thanks!

 

[Herve]

Hello,

Please keep in mind that this is just my opinion.

Do not bother with the past, even if you are selling your company (ability to make cash and to receive orders are the most important). The only risk you have is if you go into a tax audit. But here again they won't go back more than a certain number of years (for instance in France it is the current year and three prior years). Again I would be tempted to leave it as it is (and fix it if tax authorities show up).

For the current year and the issues about loans (and probably fixed assets ?) just go to a CPA (a good one!) as it won't take him long to fix your issues (also it souldn't cost too much). Why ? because he will rebuild the balances of your loan accounts, for instance, thanks to the documents provided by your bank (mainly the loan amortization doc).

Finally, did you think about taking legal action against the bookkeepers ? Except if they were your employees as in this case you was supposed to know or to have a skilled person checking what they were doing.

In which country are you ? What is your business ?

Please have a good day

Herve

 

[Samir]

I've seen this scenario before all too many times.

The short advice, do it correctly from now on.

The longer advice, do it correctly from now on and fix what you can as you have time and documentation to do so. You can always amend tax returns and such going forward if mistakes from the past mess them up. And even if you can't, and least you know where your books (and business) truly stand.