Creative Agency Bookkeeping

Creative agencies have a unique energy. The work is fast, client-driven, visually focused, and built around talent and execution. When a creative business gets busy, it usually gets really busy. Shoots run late, clients change deliverables, invoices go out at odd hours, and the team is constantly in motion. In that environment, bookkeeping becomes something you “get to when you can,” which often means it slips behind the scenes until something breaks.

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A while back, I worked with a creative agency in California that perfectly showed how this happens. They were a wardrobe and makeup team that served studio productions in Los Angeles. It started as a husband-and-wife business. They were good at what they did, clients trusted them, and their reputation kept spreading. Before long, they grew from two people to about ten and crossed into seven figures in revenue.

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They were successful, growing, and booked out. But their internal financial systems never caught up.

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The Early Signs

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Before I even opened their QuickBooks Online account, I knew from our first phone call that several problems were waiting. They casually mentioned that they had been using QuickBooks Payroll, then switched some of their team to a payroll company designed for the entertainment industry called Wrapbook.

That meant both companies were likely filing tax forms at the same time for the same EIN. Two sets of 941s every quarter. Two sets of 940s every year. And the IRS rejecting both because the filings conflicted. That alone is enough to throw a business into chaos.

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Once I logged into their QuickBooks Online account, the three biggest red flags jumped out immediately:

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1. Commingled credit cards

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Personal cards had been added to the business’s chart of accounts. Hundreds of personal transactions ran through the bookkeeping alongside legitimate business expenses. Employees were also using personal cards as authorized users. No bookkeeper can cleanly automate rules around that.

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2. Undeposited funds that went back years

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Their undeposited funds account had a historical balance that had grown year after year. That told me payments were recorded but never properly matched to deposits. At that point, the revenue number becomes unreliable.

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3. Two active payroll liability accounts

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Both QuickBooks Payroll and Wrapbook had liability accounts holding balances. That confirmed both systems had been running simultaneously. Every filing would need to be corrected.

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Individually these issues are fixable. All three together usually mean one thing: the cost of fixing the account is higher than the cost of rebuilding it.

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A Business Growing Faster Than Its Structure

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To be clear, this couple wasn’t irresponsible. They were overwhelmed. Their business grew steadily by thirty five to fifty percent every year. Their reputation in the Hollywood production world was strong. When you have that kind of demand, bookkeeping becomes something you squeeze in between jobs.

But they were starting to feel the consequences. They didn’t understand why their tax situation looked the way it did. The numbers felt cloudy. Their QuickBooks account didn’t reflect their actual performance. They were paying themselves well, but they had no real visibility into what they earned versus what they spent.

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The emotional moment for most business owners is when they realize they’re capable operators but not accountants. And that’s perfectly normal. That moment is usually the turning point toward getting help.

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Choosing Between Cleanup and Rebuild

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The biggest decision was whether to salvage their existing QuickBooks Online account or start fresh. I explained it the way I always do. You can pay me to unwind three years of tangled accounting, or you can pay me to build a clean system that reflects reality moving forward. Same spending category, but very different outcomes.

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They immediately understood. Business owners speak the same language when it comes to cost versus value.

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We agreed to:

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• keep the old QuickBooks Online account active only as a reference

• create a brand-new QuickBooks Online account

• rebuild clean structures, clean chart of accounts, clean payroll configuration

• formalize spending policies and corporate credit cards

• create a monthly bookkeeping cadence they could rely on

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This gave them a fresh start and avoided dragging mistakes into the new setup.

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The Rebuild Process

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Rebuilding the account took about two weeks. We created a completely new chart of accounts and rebuilt their spending structure. Their employees received proper corporate credit cards instead of using personal ones. We established rules around personal versus business spending. We aligned payroll into one clean system. And we set up monthly reconciliation cycles.

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The hardest decision involved invoicing. Because they were using QuickBooks Payments in the old account, they had to decide whether to migrate mid-year or wait until January. We ultimately kept invoicing in the old account until year end, then moved everything into the new QuickBooks Online account at the start of the year.

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On the compliance side, we prepared a full set of combined payroll numbers for their CPA. Since neither payroll provider issues revised filings, the CPA had to rebuild the 941s and 940s manually. Clear, reconciled data made that process far smoother, and in the compliance world, silence from your CPA usually means success.

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Operational Transformation

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Once the rebuilt account was complete, the change for them was immediate.

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They finally had real visibility. Their revenue and expenses made sense. Their payroll numbers aligned. They knew what they truly earned, what they spent, and what they owed. Their books gave them clarity instead of anxiety.

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It also changed their behavior. They stopped paying rent from business accounts. They stopped using personal credit cards for business purchases. They set up formal corporate cards for their team. Their financial habits aligned with the size of their business.

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And emotionally, they went from overwhelmed to confident. Having support in an area they didn’t understand was a relief. They also had enough experience doing bookkeeping themselves to appreciate the difference between guessing and knowing.

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What This Teaches Us About Creative Agencies

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This project reinforced something I’ve always believed about creative entrepreneurs.

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They are talented. They see the world differently. They produce exceptional work. But the accounting side of the business rarely matches the pace of their growth. When agencies scale quickly, it’s almost always the financial systems that fall behind first.

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What matters is not whether you kept perfect books for three years. What matters is recognizing when the business has outgrown the systems you built when you were small.

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And the most important lesson is simple.

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It is okay to ask for help.

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You don’t get extra points for handling payroll compliance alone. You don’t need to be your own bookkeeper forever. You just need a system that gives you accurate numbers so you can make confident decisions.

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This creative agency didn’t get healthier because their bookkeeping was “fixed.” They got healthier because their bookkeeping finally matched the scale and pace of their business.

When your books stop being a mystery, everything else becomes easier.