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How Do I properly adjust old Balance Sheet balances?

Angela Lyon's Profile

I just took on a client who has books that are a MESS. There are several accounts on the balance sheet that are obsolete- lines of credit that have been paid for over 2 years, payroll liabilities that had been sitting there since 2015 when she switched to full service, old credit card balances, a vehicle purchased in 2012 and more.

Normally I would try to track down what happened and record everything appropriately but I'm lost, here. This could take a lifetime! She has multiple bank accounts that she went through and have since closed so tracking it all down is really not a practical solution.

I'm wondering what is the right way to handle this? How do I make these adjustments so they will make sense to the tax accountants and not upset them?
Thanks

Pardon typos, typed using hand held device.

Answers

Anonymous
(Owner) |
Len Green
Title: Performance Improvement Consultant and E..
Company: Haygarth Consulting LLC
LinkedIn Profile
(Performance Improvement Consultant and ERP Strategist, Haygarth Consulting LLC) |

Angela
If you cannot trust the opening balances, aren't you at risk for relying on them knowing they are wrong? Why not advise your client to engage with you and the tax accountants in a meeting to discuss how to move forward? They may have encountered this before and may know how to discuss it with the IRS.

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