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Having a competent bookkeeper could be the difference between steering your business to new growth and letting it spiral out of control, like a helicopter crash in an action movie. Bookkeeping is nothing fancy, but it is critical to your business success. No matter who your current bookkeeper is, you must have confidence that they’re doing their job well and with your company’s bottom line in mind. First and foremost, they have to have a clear and concise understanding of what your company does. Their daily knowledge and work could be what leads to cutting nonessential costs and increasing your margins.

For a busy business owner, it can be hard to tell if your bookkeeper is taking your books or you to the cleaners. With dozens of other responsibilities that come with running a business, you might not know what good bookkeeping actually looks like, let alone the warning signs that they are completing job completely.

To help, we’ve put together this list of telltale signs to help you determine if you’ve hired a bad bookkeeper or one worth keeping.

1. Always behind in responding to you.

There’s nothing more frustrating than shooting off a note to your bookkeeper with a simple request, only to have them take a week or longer to respond–or even worse, not respond at all. This goes along with general professionalism, which you should be able to expect from them. However, if they take forever and a day to respond to your emails or return your calls, it a good sign they don’t care enough. A reactive bookkeeper is bad for business where a proactive one can prevent disasters.

2. Always behind on the books.

If you bookkeeper is always scrambling to close the books at month-ed, or if the previous two months books still are not squared up, then you probably have someone who is not looking out for your best interest and isn’t the right person for your business. Obviously, things come up–just as they do with any job or position–but an experienced professional looks for opportunities to get caught up, maintain deadlines, and even keep in touch with their clients to let them know of any possible delays. The bottom line is that your business can’t grow if you’re constantly trying to catch up.

3. Don’t understand basic bookkeeping terminology.

Believe it or not, there are stories out there about bookkeepers who didn’t know what general terms like ‘reconciliation’ meant or know the difference between the balance sheet and income statement. Your bookkeeper can be a key member of your team and they should maintain the knowledge and skill necessary to provide professional services competently. This means attaining and maintaining an adequate level of knowledge and skill, and application of that knowledge and skill in providing services to their clients.

4. Fail to provide helpful reports or don’t know what a report means.

When it comes to your company’s books, accurate, timely, and insightful reporting is just as important as reconciling the books and categorizing transactions. An effective bookkeeper runs reports on the regular and doesn’t go quiet when a new report is requested. The financial reports that should be received regularly, if not monthly, are the balance sheet, income statement (profit & loss) and cash flow statement. These reports provide you with a better view of your company’s financial health, allowing you to make the right decisions to succeed and achieve growth.

5. Don’t let you see the books.

This is a HUGE sign that something is being hidden or covered up. Like mismanagement or improper reporting, or worse–they could be stealing from you.

6. Bounced checks or declined payments.

This one is big because your ability to function as a company is dependent on your accounts being reconciled and managed properly and on a timely manner. One bounced check is too many and it demands investigation into what is happening.

7. There are excuses or passing the blame.

These are signs that show clear lack of independent thinking which may mean they’re not reviewing your books as thoroughly as needed.

8. No questions are asked.

Questions are a necessity to have a better understanding of your business and how it operates. There should be a digging deeper to help identify problems, finding solutions and opportunity areas. If questions are not being asked, they probably don’t care and there is no driving forward your overall goals while cutting costs.

9. You are questioning their work.

Finally, trust your gut. If you have a feeling that your bookkeeper is doing it wrong, or you’ve seen the same mistakes over and over again, it’s time to find a new solution. The bottom line comes down to your bottom line. Are you happy or do you need to revise your strategy and find a better solution?

If you need assistance in taking your business to the next level by saving time and adding accounting value, please contact us. We can be the accounting and bookkeeping solution to your business success and growth.

Post Author: Lorrie Toillion, CFP®

Accounting Specialist, Tax Assistant, and Client On-Boarding Associate.