The Season Was Working

The jobs were there. The calls were coming in. By every measure he could see, the business was having a good fall.

He’s a custom cabinet builder in Bonita Springs — residential and light commercial work, long lead times, deposits collected weeks before delivery. He’d been in business long enough to know what a good season felt like. This one felt like one.

When his bookkeeper asked him what profit looked like for the last quarter, he gave her a number. Confident. The business was doing well — he knew it.

The books had a different number.

What the Numbers Said

The gap wasn’t small. And it wasn’t a sign the business was failing — it was a sign that the books and the business had been running on different timelines.

For a contractor with long lead times and upfront deposits, that’s a common setup. Income gets recorded when the deposit clears. Materials get posted when the invoice comes in. Owner draws flow through an account that doesn’t get looked at until something breaks.

None of it is intentional. Most of it happens because the owner is running the business, not auditing the books.

What the Review Found

The cleanup review took three weeks. It surfaced four things:

•  Income recognized at deposit — before jobs were delivered or completed

•  Material costs posted to the wrong periods on two large installs

•  Four months of owner draws running through an account that hadn’t been reconciled

•  An open balance on a finished commercial job that had been sitting in the wrong category since spring

Each item was correctable. None required going back more than eight months. The books didn’t need to be rebuilt — they needed to be caught up and aligned with what the business had actually done.

The Approach

The review started with a three-month reconciliation — bank accounts, credit cards, and the two job accounts that were most active. Once those were clean, the income timing issues became visible.

We adjusted the income entries to reflect job delivery dates, realigned the material costs to the correct periods, and cleared the unreconciled draws. The open commercial balance was reclassified and closed.

For contractors in this situation, the cleanup process at primeentrybookkeeping.com/cleanup-services is designed to move through this kind of work methodically — account by account, period by period — without disrupting how the business operates.

What Changed

The P&L reflected the actual quarter. The bank reconciliations were current. The owner’s number and the books’ number were the same number.

He went into his CPA meeting in November with clean books, a reconciled trial balance, and a clear answer for every question. The conversation was about tax strategy, not what happened to the accounts receivable.

Why October

The same review done in December would have taken the same three weeks — but the CPA would already be engaged, the calendar would be compressed, and the pressure of the year-end deadline would be in every conversation.

Done in October, it’s organized work. Done in December, it’s a deadline project.

For most contractors in Southwest Florida, the season that’s beginning now is also the season that shows up in the year-end books. Getting ahead of it is still possible. Barely — but still.

Next Week’s Theme: The Balance Sheet Conversation Most Small Business Owners Have Never Had

Resources

If you’re a contractor in Bonita Springs or the surrounding area and want to know whether the books reflect what the business actually did, two free resources are available at primeentrybookkeeping.com/resources:

•  Bookkeeping Cleanup Diagnostic Guide — a structured look at where cleanup projects typically start

•  Contractor Job Cost Checklist — for contractors who want to know whether job costs are tracking the way they should

A Clarity Call is a no-cost starting point: https://calendly.com/jim-primeentrybookkeeping

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