and Financial Coaching LLC

Blog

Accounting Basics

Is Your Accountant Doing Their Job?

Accountant reconciling

How do I know my bookkeeper is doing their job?

This is a great question and one I get asked at times. I can’t provide you with an exhaustive list (I’m pretty passionate about this topic so we would be here all day), but I can give you five things to look for to see if your bookkeeper or accountant is the right person for you.

They work to understand your specific needs

Each business is unique and will have individual needs. Even if your business provides the same types of products or services as the guy down the street, you have features that set you two apart for the customer and the same is true for the behind-the-scenes operations.

You need to have an accountant who has experience with your industry and what your specific concerns might be. Now, keep in mind, that because every business is different, your accountant will need to still ask plenty of questions even if they are familiar with the industry. Their ability to ask the right questions indicates a willingness to get to know your business.

They do full reconciliation of the books and provide the right reports in a timely manner

Wendy, isn’t that more than one thing? Yes, but they go hand-in-hand so I consider them all part of “doing the books” correctly.

First, when you think of reconciling the books, you probably just think of your bank statements, right? It is so much more than that. A common mistake I see with small businesses and startups alike is that they treat their credit card as a vendor and just put “Visa” as an expense. Well, that’s not right. Your bookkeeper should be taking your credit card statements and matching the expenses to the right category in your bookkeeping software. The same is true for any cash receipts.

The next part after your bookkeeper reconciles the accounts is that they provide you with the right reports to help with your decision making. What’s more, your accountant should be sending these reports in a timely manner. What “timely” means will vary according to your industry and individual needs, but whether a report is supposed to be conducted monthly, quarterly, or annually, those reports must be on time for maximum effectiveness.

They help you understand your reports

Once you get those reports, you need to understand what they say. A good bookkeeper will help you understand the information and, more importantly, what that means for your business. They will also answer questions you may have. If they don’t know the answer right off the top of their head, they need to be willing to research.

Lastly, they help guide you through decisions in your future using the financial reports. Truth be told, your bookkeeper should be the first person you call when making any kind of decision that involves money.

They have solid operational procedures within their own business

Wait, you want me to ask how they run their own business? No, not quite. But I do recommend looking for several key elements.

First, are they closely familiar with multiple accounting software programs? I prefer Quickbooks, but some of my clients may use an equally reliable software. If I can’t function within that software, I cannot serve them as well.

Second, they need to provide an engagement letter. This is not a contract, but more a scope of work statement. If there is ever any question, you can both return to the engagement letter to determine if the work fits the agreement’s scope.

Third, make sure they will protect your business information. This not only includes crucial information such as passwords, but private information about your operations and future plans.

They are good at personable customer service

This may seem strange to discuss for an accountant, but I’ve learned that working well with people can be just as vital to my job as knowing the accounting procedures.

Ask yourself these questions:

  • Does your bookkeeper keep in touch and are they relatively easy to reach?
  • Do they make you feel confident in knowing your business’ financial state because of their help?
  • Do you feel comfortable talking to them about your accounting and feel like your concerns are addressed?
  • Do you feel like you can trust them as an advisor in making decisions, even the small ones, in your business?

Let me help you!

Are you a Northwest Arkansas small business or startup who needs a qualified bookkeeper? Or are you starting to feel like perhaps your relationship with your existing accountant could be better? Perhaps it’s time to switch. Give me a call and I’d love to help you excel at your business.

Wendy Kane