Every tax season, we receive last-minute inquiries such as, “Can you still help us file?” If the documents are simply unorganized, that is usually manageable. What has become the most challenging situation for accounting firms in recent years is when clients subscribe to cloud accounting software such as freee or Money Forward and only sync multiple bank accounts and numerous credit cards, assuming that this alone completes their bookkeeping.

In such cases, it may appear that “the data is there,” and the trial balance may even look reasonably complete. However, from the perspective of preparing a proper and reliable year-end closing, the situation is actually worse. The more data that is blindly synced, the more difficult it becomes to finalize accurate financial statements.

1. Four Breakdowns Caused by “Syncing Only”

When the following four issues occur together, the workload increases dramatically.
1. Too many bank accounts
When multiple bank accounts are used, each account generates deposits, withdrawals, transfers, and synchronization errors. Reconciling bank balances with accounting balances becomes extremely time-consuming and complex.
2. Balances do not reconcile
Due to missing syncs, duplicate entries, or unprocessed transfers, the balances in the accounting software do not match the actual bank balances.
3. Business and personal expenses are mixed
Private expenses and social insurance payments are made from business bank accounts or business credit cards, making it difficult to determine what is deductible.
4. Too many credit cards
Different closing dates, payment dates, and transaction descriptions make it very difficult to track which expenses were paid from which accounts.
In practice, the most serious problems are having too many bank accounts and too many credit cards. As the number of accounts and cards increases, the number of items that must be checked to reconcile balances grows exponentially. This inevitably leads to synchronization discrepancies and unprocessed transactions. Cloud accounting software is a tool designed to reduce manual data entry, but if the flow of money is complex, syncing simply imports that complexity directly into the accounting records, making year-end closing and tax filing significantly more difficult.

2. For the Current Year, You Often Have No Choice but to “Make It Work”

To be honest, when an entire year’s records are already in disarray—especially now that the Japanese invoice system is in place—it is often difficult for accounting firms to bring the books to a level they would consider “clean.” Given filing deadlines, we must realistically find a workable compromise.
Even then, the task that consumes the most time is almost always reconciling balances.
That said, for the sake of next year, there are a few minimum steps that should be taken. First, confirm opening and closing balances for all bank accounts using passbooks or online banking records. Second, determine outstanding credit card balances based on card statements. Third, expenses that appear to be personal should be temporarily classified as owner’s draws rather than business expenses. Fourth, and most importantly, confirm revenue by securing evidence such as bank deposit records and invoices. Errors or omissions in revenue are far more problematic than messy expenses. These steps cannot be completed solely within cloud accounting software; bank statements, credit card statements, and invoices must be reviewed together to ensure consistency.

3. The Most Effective Solution: Designing a Simple Money Flow for Next Year

This is the key point. The most effective way to make tax filing easier is not mastering accounting software, but simplifying the flow of money itself.
While the ideal setup may not always be achievable, getting as close as possible makes a significant difference. The recommended structure is as follows: use one bank account if possible (no more than two or three at most); use one credit card if possible (again, no more than two or three); limit those accounts and cards strictly to business income and expenses; completely separate personal use by maintaining separate personal bank accounts and credit cards; sync only business accounts and cards to the accounting software, and do not sync personal or mixed-use accounts; and manage business expenses paid from non-synced accounts, credit cards, or cash separately in Excel or similar tools, including items that require allocation between business and personal use.
There are limits to what cloud accounting software can do. Syncing is convenient, but if transactions are mixed in real life, they remain mixed after syncing.

4. Conclusion: The Correct Approach Is “Separation,” Not “Syncing”

Introducing cloud accounting software is, in itself, a good decision. However, success depends on one key condition. What truly makes accounting easier is not the app, but the separation of money flows.
I personally experienced this when my credit card was used fraudulently and I had to change all registered payment settings. It was certainly inconvenient, but by spending a few focused hours reviewing statements, the task was completed. Organizing bank accounts is no different.
There is a saying in Japanese: “Once the pain passes, it is easily forgotten.” Before that happens, take action as early as possible. Doing so will make next year’s tax filing stress completely different from this year’s.