Bookkeeping for Series A startups

The change at Series A is not volume. It is audience. Up to now the books answered your questions. From here they answer a diligence process, a board, and eventually an auditor — people reading specifically for what does not add up.

Accrual, and revenue recognised properly

Cash basis will not survive a Series A process. Beyond that, subscription revenue has to be recognised under ASC 606 — over the period you deliver, not when the invoice is paid. A company billing annually upfront and recognising on receipt is overstating current revenue and understating deferred revenue, and diligence finds it.

What diligence actually asks for

• Monthly accrual P&L and balance sheet, usually 24 to 36 months back.
• A revenue schedule that reconciles to the P&L and shows the recognition policy.
• A cap table that agrees with what the equity accounting says.
• Bank reconciliations proving the cash figure is real.
• Payroll records matching the headcount narrative in the deck.

None of it is hard if the close has been done monthly. All of it is brutal if it is being assembled in a fortnight while also running a fundraise.

409A and the board

A priced round triggers a fresh 409A valuation, and option grants after it price off the new figure. You also now have a board with its own reporting cadence, which is set by them rather than by what is convenient.

What we do for Series A companies

Accrual close monthly with a named accountant, revenue recognised to policy and documented, board packs that reconcile, and a diligence request answered from records that already exist.

Frequently asked questions