By - December 2, 2025
Categories: Bookkeeping, Financial Reports, Financial Statements
Year-end can feel like a full-speed sprint for auto repair shop owners. Between customer vehicles, scheduling, vendor orders, and keeping the shop running smoothly, it’s easy to push bookkeeping to the back burner.
But here’s the truth: your year-end bookkeeping checklist is one of the most powerful tools for boosting profitability, streamlining operations, and starting the new year with confidence.
Click here to grab our free Year-End Checklist right now!
A clean year-end gives you accurate, reliable numbers you can trust. And for auto repair shops, where parts, labor, and margins shift quickly, clarity is everything.
Below is a practical, step-by-step guide designed specifically for auto repair shops to help you close out the year with a stronger financial foundation.
- Start by Reconciling Your Accounts
A solid year-end starts with clean data. Before anything else, make sure the numbers in your bookkeeping software match your real-world bank and credit card activity. If the balances don’t align, your financial reports won’t tell the truth—and basing decisions on inaccurate information can lead to serious issues later.
Reconciliation is the step that gives you confidence in everything that follows.
- Follow Up on Outstanding Customer Invoices
Auto repair shops often have lingering unpaid invoices—sometimes because customers forget, sometimes because insurance or warranty processes drag on. Before the year closes, take time to review which invoices are still open and follow up on them. Even collecting a few overdue balances can dramatically increase your cash flow heading into the new year.
- Bring Your Vendor Activity Up to Date
Vendor accounts can easily fall behind when your team is focused on repairs. Review the bills you’ve received throughout the year, confirm they’re entered, and compare vendor statements to what’s in your books. If a return or credit hasn’t been applied yet, make note of it so it doesn’t distort your year-end expenses.
This step ensures your Cost of Goods Sold is accurate and that you’re starting the new year with a clear picture of what you owe.
- Review Your Parts Inventory
Inventory impacts your profitability more than almost anything. A year-end spot check helps you correct any discrepancies that have built up over the year. Pay close attention to fast-moving items and any parts that are outdated, damaged, or no longer usable. Updating your inventory now means your financials will reflect true numbers rather than estimates.
- Clean Up Payroll & Contractor Records
Whether you rely on technicians, service writers, or contractors, payroll accuracy matters. Review your payroll summaries, make sure all hours and bonuses are recorded, and confirm you have updated tax documentation for contractors. Cleaning this up now prevents payroll surprises and compliance problems later.
- Update Your Equipment & Assets
Auto repair shops invest heavily in tools, lifts, scanners, and equipment. If you purchased or retired anything this year, make sure it’s recorded properly. Your tax professional will use this information to calculate depreciation and ensure you get the deductions you’re eligible for.
- Review the Big Picture With Your Financial Reports
Once everything is updated, pull your Profit & Loss and Balance Sheet. Look at how your parts margins performed, whether labor rates kept up with technician efficiency, and whether expenses climbed more than expected. These trends will guide your planning for staffing, pricing, and operations in the new year.
- Meet With Your Bookkeeper Before Year-End Closes
A short meeting with your bookkeeper or CPA can bring your financial picture into sharper focus. They can help you make final adjustments, estimate taxes, and position your shop for a smooth January start.
Final Thoughts
A thoughtful year-end process helps you enter the new year with clarity and confidence. When your books are organized, your numbers become powerful tools for growth. And if you’d like expert support from a bookkeeping team that specializes in auto repair shops, Three Rivers Bookkeeping is ready to help you shift into high gear.