What is startup bookkeeping?
Books built to survive diligence, from the first transaction.
Startup bookkeeping is a different job from routine monthly bookkeeping the moment a company is on a venture track: the books stop being a record for the owner alone and become a document a lead investor's counsel, a 409A valuation firm, and eventually an auditor will all pull on. The trigger isn't the calendar, it's the round — a SAFE landing in the bank account, a term sheet circulating, a board meeting where someone asks for a KPI page instead of a bank balance. Books built for that moment carry source-document backup behind every entry: the signed SAFE or stock purchase agreement behind every equity line, the subscription contract behind every dollar of deferred revenue.
Convertible instrument and priced-round proceeds get recorded exactly as the signed documents state, never as our own read of the deal. A SAFE (whether it carries a valuation cap, a discount, or both, and whether it's post-money or pre-money) is entered as the instrument type your lawyer's paperwork specifies — typically temporary equity or a liability, never revenue, never a loan by default. When a priced round closes and SAFEs or notes convert, the resulting share count and additional paid-in capital are booked to match the conversion mechanics in the closing documents and the updated cap table, not to a valuation we picked.
Why it matters
| Without a system | With CapEasy |
|---|---|
| Month-end arrives whenever someone gets to it | Books closed on a fixed date, in the same shape every month |
| Unexplained transactions pile up in a suspense account until year-end | Every account reconciled to the statement, with discrepancies explained not plugged |
| Your accountant bills you to fix bookkeeping before they can do their own work | A short questions list instead of a year-end archaeology project |
| You cannot answer "how did we do last month" without a week of digging | Whoever files opens a finished file |
What we need from you
Financial
- Bank and card statements
- Sales invoices
- Supplier bills
- Expense receipts
- Payroll summaries
- Loan statements
System
- Chart of accounts
- Opening balances
- Accounting software access (read/write, least privilege)
- Multi-currency details if applicable
Context
- Prior period financial statements
- Your accountant’s coding preferences
- Anything unusual we should expect
How it runs, step by step
- Transaction recording & classification
- Daily transaction entry
- Revenue and expense categorisation
- Capital vs operating classification
- Ledger & trial balance
- General ledger review
- Sub-ledger reconciliation
- Chart of accounts restructuring
- Reconciliation
- Monthly bank and card reconciliation
- Discrepancy investigation, with a written explanation
- Multi-account and multi-entity reconciliation
- Catch-up & clean-up
- Working back from the last clean period
- An honest read on how far back the records support
- Rebuilding to current
Who does what
| Your CapEasy team | Startup bookkeeping, the reconciliations and reporting behind it, and the questions list that keeps it honest. |
| Your CPA or enrolled agent | Everything that carries a licence in United States — rendered exactly as written: issue compilation, review or audit reports — those are restricted to licensed cpa firms. |
| You | One conversation with one named person, and the decisions that are genuinely yours. |
Startup bookkeeping in United States
Deferred revenue and ASC 606
Cash collected for a subscription or contract isn't recognized as revenue on receipt — under ASC 606, it's deferred and released to the P&L as the performance obligation is satisfied, typically ratably over the contract term. We build and maintain the deferred revenue schedule against the actual subscription start and end dates in your contracts; your CPA relies on that schedule when the return or any GAAP-basis statement is prepared.
Section 174 R&D capitalization and the credit study
Since the 2022 tax-law change, research and development costs generally can't be expensed immediately — they're capitalized under IRC Section 174 and amortized over five years (fifteen for foreign research). Separately, a company may also be eligible for the research credit computed on Form 6765. Both calculations depend on clean, project-coded cost and time data. We capture and organize that data; the CPA determines eligibility, computes the amortization schedule, and files the credit.
Delaware franchise tax — two methods, one dataset
Most VC-backed C-corps are incorporated in Delaware, where annual franchise tax is calculated under one of two methods — Authorized Shares or Assumed Par Value Capital — and the two can produce very different bills for the same company. We keep the inputs both methods need (authorized share count, issued shares, par value, total gross assets) current in the books. Which method to file under is a decision for your CPA or registered agent, not something we choose.
UAA s.14(a) and investor requests for "reviewed" financials
A lead investor or their counsel will sometimes ask for "reviewed" or "audited" financials as a condition of closing. Under the Uniform Accountancy Act s.14(a), issuing a compilation, review, or audit report is restricted to a licensed CPA acting in that engagement — it isn't something a bookkeeping engagement can produce regardless of how clean the books are. We prepare GAAP-basis statements with full supporting detail; your CPA is the one who can accept the separate engagement to issue the report itself.
What your CPA or enrolled agent receives from us
- Monthly GAAP-basis financial statement package (P&L, balance sheet, cash flow statement) formatted for a board or investor update
- Deferred revenue schedule tied line-by-line to each subscription contract's start date, term, and billing amount
- SAFE, convertible note, and priced-round proceeds ledger entries reconciled to the signed instruments and the current cap table
- Operating cash burn and GAAP net loss shown side by side, with a runway calculation at current burn
- R&D cost and time detail coded by project, staged for the CPA's Section 174 capitalization schedule and Form 6765 credit study
- Delaware franchise tax inputs — authorized shares, issued shares, par value, gross assets — current for the registered agent or CPA
