Handing over the management of your finances shouldn’t be taken lightly. More than likely, you’re a little apprehensive about finding the right bookkeeper for your business. If you currently complete bookkeeping tasks for your business, you know the importance of having accurate records for your business’s financial health.
By hiring someone to oversee your finances, you’ll gain additional benefits you may not have considered. It’s important to know if you should hire someone or do it yourself.
After reading this post, you’ll know what qualities to look for in a bookkeeper and tips you can use to begin your search for the ideal person for the job.
What makes a good bookkeeper?
You may or may not know what a bookkeeper does. The financial expert performs a broad range of tasks and works behind the scenes to streamline the accounting process. They are your go-to person when you have financial questions.
Here’s a list of qualities you should look for in a bookkeeper:
They view you as the most important person
It doesn’t matter if you’re their only client or if they have a dozen more. They invest their time wisely so you reach your business goals. Your business priorities become theirs. They understand what you intend to achieve and work to make that happen.
They’re interested in profits
A bookkeeper wants to save you money. They have the expertise to look for common tax reductions and find ways to reduce expenses. They never want to be the reason you pay penalties and fines for submitting withholdings or estimated tax payments after the due dates.
A good bookkeeper is organized and detail-oriented
They reconcile bank accounts with the business’s financial records on a timely basis. Hard copies of financial data are stored neatly and can be retrieved easily because having an organized filing system is a priority. They know how to prioritize tasks.
Reliability is a hallmark of their success
Their integrity is unquestionable and they don’t discuss financial details with anyone other than you or someone you authorize. Likewise, they’re honest and trustworthy.
They love numbers and are problem solvers
A good bookkeeper doesn’t mind looking deep to discover why costs run high. Creating comparisons on spreadsheets to find solutions to financial concerns is one of their strengths. Good bookkeepers are analytical thinkers and prefer using technology to enhance small business bookkeeping skills.
They’re good communicators
Because every person is different, bookkeepers must be able to communicate with customers, employees, and especially you without creating misinterpretations and confusion.
Finding the best fit for your business
There are various ways you can hire a bookkeeper. Deciding how to hire one solely depends on you and the needs of your small business
You set the employee’s hours and define the scope of work you want to be completed which may involve tasks other than bookkeeping.
You pay your employer’s contribution toward social security and Medicare taxes and are responsible to pay any state unemployment taxes.
If you offer holiday and vacation pay to a part-time or full-time employee, the cost becomes an additional overhead expense.
If you need to catch up your bookkeeping records, you can hire someone for a set period at a fixed rate to keep your financial transactions current. If you’re pleased with the work, you can continue the relationship each month.
The cost becomes a fixed expense unless you make changes to the contract.
Contracting works for businesses that only need a minimal amount of small business accounting. Either party can cancel the contract at any time.
Hiring a virtual freelance bookkeeper means you don’t pay employee benefits, purchase equipment, or provide physical space for them to work.
Since they normally work for several clients, they may bring fresh ideas that benefit your financial operation. To stay competitive, a freelancer stays up to date on the latest technology and accounting software.
You need to ensure that your sensitive information isn’t compromised through information breeches and that the freelancer understands the ins and outs of your business. For that reason, you may spend more time monitoring their work.
A bookkeeper can be matched with your type of business and the level of experience you need for the job. Since the agency specializes in accounting, they stay current on tax regulations and changes.
They can serve as financial consultants, planners, and analyze data to make recommendations for improvements. You pay only for the services you need.
8 tips to find the best bookkeeper
1. Be clear about the details
Before hiring a bookkeeper, prepare a job description detailing what the person will do for X number of days per week or hours.
2. Decide how much you can pay
If you intend to pay the cheapest rate, you probably won’t hire the best person for the job. Depending on whether you hire an employee, freelancer, or agency, fees may range from $20-$50 per hour or $500 – $2,500 per month when paying a fixed fee.
3. Advertise based on your needs
If you prefer hiring an employee or agency, advertise in local newspapers. You can use platforms, like Indeed, to hire a freelancer.
4. Consider candidates with a mix of education and experience
An applicant may have an accounting degree but very little or no hands-on bookkeeping experience. If they understand accounting terms but have no practical application or experience to draw on, they will lack performance skills.
It’s a huge plus when the candidate has used the same accounting software you use.
5. Follow up on at least 3 references
According to the Society for Human Resource Management 8 out of 10 employers check references for prior experience. Find out if the applicant was a dependable worker and would be considered a good fit for your business.
6. Ask the right questions
Find out if the applicant has real-life experiences dealing with bookkeeping and handled responsibilities related to your business industry. Ask them about their computer skills and the accounting software they have used.
Furthermore, find out how they would handle accounting discrepancies such as unbalanced reconciliations or post adjusting entries. Explore what they like and dislike about bookkeeping and ask for examples of ideas they implemented in other accounting positions.
7. Test their skills
If you still aren’t sure about a potential applicant’s skills, you can use a free online practice skills test to help you decide. There are tests offered by the National Association of Certified Public Bookkeepers. To be fair, give a bookkeeper time to become familiar with the site before testing.
8. Work out a trial arrangement
Choose a one or two-month trial period to make sure the bookkeeper and your business are a match.
Hire the best bookkeeper
Perhaps you aren’t prepared financially to hand over your bookkeeping to a bookkeeper. You may not be aware that improving your small business bookkeeping can increase profits and help your small business grow.
But remember that someone managing your finances regularly keeps your business on track because they know how to identify money drains and face financial concerns head-on.