Introduction:
Running a business is demanding. Whether you’re a tradesperson, freelancer, or small business owner, your days are usually packed with jobs, admin tasks, customer enquiries, travel, suppliers, quotes, and the constant pressure of keeping everything moving.
With so much going on, bookkeeping is often the first thing to fall behind.
But here’s the truth: even if your records “look fine” on the surface, there may be hidden issues, duplicate invoices, missing transactions, incorrect VAT, or expenses that haven’t been claimed. These small errors add up and can cause big problems later, especially when HMRC deadlines roll around.
That’s where a Bookkeeping Health Check Review becomes invaluable.
In this guide, you’ll learn exactly what a Bookkeeping Health Check includes, why it matters, and how Carter Bookkeeping Services Limited helps business owners get complete financial clarity fixing old errors, highlighting risks, and giving you the confidence that your accounts are accurate, compliant, and fully up to date.
What Is a Bookkeeping Health Check?
A Bookkeeping Health Check is a deep-dive assessment of your accounts. It looks beneath the surface to examine whether your records are complete, accurate, and aligned with real-world financial activity.
It checks whether your balances reconcile properly, whether your income and costs are reported correctly, and whether VAT, PAYE, CIS and other HMRC-related figures match the obligations you owe.
At Carter Bookkeeping Services Limited, we carry out detailed, methodical Health Checks designed specifically for busy business owners. Our aim is to help you regain clarity, correct errors, and ensure your financial data is reliable, compliant, and ready for future growth.
Stage One: Checking and Reconciling Key Balances
The first major stage of a Bookkeeping Health Check is a review of all essential balances. These balances must match actual financial records. When they don’t, it’s usually a sign that something in the bookkeeping process needs correcting.
At Carter Bookkeeping Services Limited, this review is thorough, structured, and designed to restore complete accuracy.
Supplier Statements
One of the most common areas where discrepancies appear is in supplier statements. We compare the supplier’s records with the invoices and payments that appear in your accounting software. This comparison often reveals missing invoices that were never entered, duplicates that have been added more than once, or payments that have been allocated incorrectly.
These inconsistencies can cause your supplier balances to appear higher or lower than they should. For example, you might believe you owe more than you do, or you may have underpaid a supplier without realising it. At Carter Bookkeeping Services Limited, we reconcile these statements carefully to ensure your records match what your suppliers expect, helping you maintain accurate balances and positive supplier relationships.
Bank Accounts
Your bank account is one of the most important elements of your financial system. The balance shown in your accounting software must always match the balance on your bank statements. When it doesn’t, there are almost always missing transactions, duplicated entries, or unreconciled payments.
Sometimes the bank feed stops importing data without warning. Other times, a single duplicated payment can throw off the entire account. These mismatches not only affect your cashflow reporting but also distort your financial performance. We ensure every bank transaction is properly reconciled so the figures you see are the figures you can trust.
Credit Cards
Credit card accounts are another area where issues frequently arise. Business owners often make small purchases on credit cards—materials, fuel, tools, subscriptions that can easily be overlooked. When the bookkeeping doesn’t reflect every transaction, the credit card balance in your software will not match the real balance.
We review each statement carefully and ensure all transactions, including those with missing receipts, are entered correctly. This prevents VAT errors, avoids discrepancies, and ensures all legitimate business expenses are captured.
Loans and Loan Interest
Loan balances must reflect the exact position shown on your lender’s statements. However, in many bookkeeping systems, loan repayments are recorded as a single figure without separating capital repayments from interest.
When this happens, the loan balance can become inaccurate, and the interest which is an allowable business expense may not be recorded at all. We review each loan repayment to ensure the interest and capital portions are split accurately and that the overall loan balance in your accounting software matches the lender’s figures. This keeps your accounts compliant and ensures you are claiming any allowable expenses correctly.
HMRC Liabilities: PAYE, VAT and CIS
Your HMRC liability accounts must reflect the real amounts owed. When these balances are not accurate, it can lead to incorrect submissions, missed payments, or overpayments.
We review your PAYE figures, VAT control accounts and CIS deductions to ensure that everything matches your HMRC records. If, for example, a VAT return has been submitted based on incorrect figures or PAYE payments have been recorded under the wrong period, the discrepancy will immediately appear in this review. By correcting these issues early, Carter Bookkeeping Services Limited helps you avoid costly HMRC errors in the future.
Aged Debtors and Aged Creditors
The aged debtor and creditor reports show you exactly who owes your business money and who you owe money to. They are essential for cashflow management but can easily become inaccurate over time.
During our Health Checks, we frequently find old invoices that appear unpaid even though the customer has already settled them. These usually occur when payments are not correctly matched to invoices. We also encounter cases where invoices have been duplicated, creating an inflated balance. Sometimes credit notes have been issued but never applied, leaving incorrect outstanding amounts. In other situations, supplier invoices have been paid but still appear overdue because the allocation hasn’t been completed correctly.
These issues are more than administrative problems; they distort your financial picture and can mislead you into thinking your cash flow is stronger or weaker than it truly is. Carter Bookkeeping Services Limited identifies each of these inconsistencies, cleans up your accounts, and ensures your outstanding balances reflect real-world figures
Stage Two: Reviewing Your Profit & Loss Account
Once all key balances have been corrected and reconciled, the next stage is to review your Profit & Loss account in detail. This section of your accounts reveals your business performance but only if it is accurate. If transactions are missing, coded incorrectly or recorded in the wrong period, the figures you see may not reflect reality.
Personal Payments and Missing Costs
Many business owners pay for business-related expenses through personal bank accounts or personal credit cards. These costs include things like insurance, subscriptions, mobile phone bills, tools, fuel, or utility contributions. If these expenses are not brought into your accounts, your taxable profit may appear higher than it actually is leaving you paying more tax than necessary.
During a Health Check, we review all areas where missing costs may be hiding. We help you bring these legitimate expenses into your accounts, ensuring a more accurate Profit & Loss and reducing unnecessary tax liabilities. This also helps create better habits moving forward, so you consistently record and claim the costs you’re entitled to.
Miscoded Transactions
Incorrect coding is one of the most common issues we identify in Health Checks. It happens when transactions are entered under the wrong category. This could involve personal expenses being recorded as business costs, tools being coded as materials instead of assets, or sales being allocated to the wrong revenue stream.
When coding errors accumulate, they distort your Profit & Loss account. This affects your profitability figures, your tax position and even your pricing decisions. Carter Bookkeeping Services Limited reviews your coding in detail, corrects errors and ensures your accounts provide an accurate reflection of your business.
VAT Applied Correctly
VAT is one of the most important areas of review during a Health Check because it’s also one of the easiest areas to get wrong. Mistakes such as claiming VAT when you shouldn’t, missing VAT on legitimate expenses or applying the wrong VAT code can lead to incorrect submissions and potential HMRC penalties.
We analyse how VAT has been applied across your expenses and income. This includes checking that VAT has been reclaimed accurately, ensuring VAT isn’t claimed on items where no receipt exists, reviewing reverse charge VAT where relevant, and verifying that your VAT codes align with HMRC requirements. By correcting errors and improving your processes, we help you avoid VAT discrepancies that could cause problems in the future.
Why a Bookkeeping Health Check Matters?
A comprehensive Health Check ensures your accounts are accurate, up to date and fully aligned with your actual business activity. It gives you confidence in your numbers, helps you avoid HMRC issues, and provides the clarity you need to make informed business decisions.
Accurate accounts mean you can plan more effectively, understand your cashflow clearly, prepare for tax obligations and ensure your year-end accounts are completed smoothly. It also ensures your accountant is working with clean, correct data saving you both time and money.
For many clients, a Health Check also reveals tax savings they didn’t know they were entitled to. Missing expenses, previously unclaimed costs and incorrect entries can all impact your taxable profit. By identifying and correcting these issues, you can ensure you only pay the tax you truly owe no more, no less.
How Carter Bookkeeping Services Limited Supports You?
Carter Bookkeeping Services Limited specialises in helping small businesses and tradespeople maintain accurate, compliant and streamlined accounts. Our approach is thorough, methodical and supportive.
We not only identify problems; we fix them. We don’t simply point out discrepancies; we investigate them, explain them and correct them. Our Health Check service ensures that every area of your bookkeeping from supplier statements to VAT reflects the true financial picture of your business.
We help you regain valuable time, avoid unnecessary stress and build complete confidence in your accounts. With our support, you can focus on running your business while knowing your finances are being looked after with precision and care.
Take Control of Your Business Finances Today
If you’re unsure whether your accounts are accurate, if you haven’t reconciled your balances in a while or if you simply want peace of mind before your next VAT submission or year-end, a Bookkeeping Health Check is the ideal solution.
Carter Bookkeeping Services Limited is here to help you understand your numbers, correct mistakes, prevent future issues and keep your business fully compliant. You deserve clear, accurate and reliable accounts and we’re here to make that happen.
Frequently Asked Questions (FAQs)
- What is a Bookkeeping Health Check?
A Bookkeeping Health Check is a thorough review of your accounting records to ensure all balances, transactions and reports accurately reflect your business activity. It highlights errors, missing entries, VAT issues and miscoding’s, helping you stay compliant and financially organised.
- Why do I need a Bookkeeping Health Check?
Even when bookkeeping appears up to date, hidden mistakes can build up over time. A Health Check uncovers missing supplier invoices, duplicate entries, incorrect VAT claims, unreconciled bank transactions, and inaccurate debtor or creditor balances. It ensures you’re working with reliable financial information.
- How often should a business get a Bookkeeping Health Check?
Most small businesses benefit from a Health Check at least once a year, especially before year-end accounts are prepared. However, for busy tradespeople or businesses with high transaction volumes, a quarterly review can prevent issues from accumulating and becoming harder to correct.
- What problems can a Health Check uncover?
Common issues include missing transactions, duplicated invoices, unreconciled bank entries, miscoding’s, unclaimed business expenses, incorrect loan balances, VAT errors, unpaid invoices that have actually been settled and HMRC liabilities that don’t match submitted returns.
- Does a Bookkeeping Health Check help with HMRC compliance?
Yes. A Health Check reviews PAYE, VAT and CIS balances to ensure they match HMRC records. By identifying inconsistencies early, it reduces the risk of errors in submissions and protects your business from potential penalties, interest charges or compliance checks.
- Can a Health Check save my business money?
Absolutely. Many business owners unknowingly overpay tax due to missing costs, unclaimed expenses and incorrect bookkeeping entries. A Health Check identifies these issues, allowing you to reduce your tax bill and improve your financial accuracy.
- What if my bookkeeping is very behind or messy?
That’s completely okay. A Health Check is designed to bring everything back into order. Carter Bookkeeping Services Limited regularly works with businesses whose accounts need catch-up work, corrections or full clean-up. No matter how behind things are, we can help.
- Will the Health Check disrupt my business?
Not at all. Most of the work is done by reviewing your accounting software and supporting documents. We aim to make the process smooth and stress-free, keeping you informed along the way while you continue running your business.
- Do you help fix the issues identified in the Health Check?
Yes. Unlike some services that simply point out problems, Carter Bookkeeping Services Limited actually resolves the discrepancies. We correct balances, tidy up transactions, fix VAT issues, and update your reports so your accounts are fully accurate and ready to use.
- How do I get started with a Bookkeeping Health Check?
Getting started is easy. Simply contact Carter Bookkeeping Services Limited, and we’ll discuss your accounting system, access requirements and any concerns you have. From there, we’ll begin the review and guide you through the entire process with clear communication and full transparency
Get in touch today to book your Bookkeeping Health Check review and bring clarity and confidence back into your business finances.
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