A bookkeeper is a bit like a GP – there’s one on every corner but great ones are hard to find.
And when you do find one, you should never let them go. But how do you know if your bookkeeper is good or even better, a great bookkeeper?
Let’s start with what every bookkeeper should be before we look at what makes a great bookkeeper.
1. Training and accreditation Every bookkeeper should have some sort of formal bookkeeper or accounting training and preferably be a registered BAS Agent. A registered BAS agent means that the Tax Practitioners Board are satisfied that the bookkeeper has the required skills, qualifications and a minimum amount of experience to correctly account for GST and prepare your BAS according to legislation. Use this link to check if your bookkeeper is registered.
2. Experience Like most professionals, the less experienced and less qualified bookkeeper will usually be cheaper. But judging bookkeepers by price is fraught with danger. If you’re simply comparing hourly rates, a highly experienced bookkeeper will always seem more expensive. This is not true because most experienced bookkeepers will also work significantly faster and smarter than someone who has less experience.
An example of this happened to one of my clients recently. He was paying his previous bookkeeper almost half of my rates but she charged him 16 hours a quarter to do his work. When he came to me, he almost fell over when I told him our prices. However, it took me 4 hours in total to do his work – so yes, my rate was almost double but his bill was less than half.
Now, if you want to focus on kicking some serious business butts and not worry about your bookkeeping, a good bookkeeper may not be good enough. You want and need a great bookkeeper. A great bookkeeper will do more than just get you over the line with your compliance. Here are five signs your bookkeeper is doing a great job.
1. Great bookkeepers understand your process. He or she will take the time to really understand your business and how you operate so they can make sure that the processes are as simple and efficient as possible, and nothing is missed or duplicated. They will be able to see areas that can be streamlined in your small business. .
2. Great bookkeepers ask questions. Many business owners find questions annoying. However, in order to ensure transactions are correctly allocated, it is better that your bookkeeper asks questions rather than guess. One of my IT clients had a bookkeeper who allocated computer purchases to ‘Computer Equipment’ in the balance sheet rather than hardware purchases in ‘Cost of Goods Sold’. For months they thought their profit figures were really great until their accountant did their tax return and asked about all their asset purchases (which weren’t), to claim for tax deductions. If only she had asked. .
3. Great bookkeepers know what they don’t know. Not only do they know what is legally within their scope (e.g. BAS Agents are not permitted to give any income tax or FBT advice) but they are also not afraid to say “I don’t know” rather than worry about looking silly and will contact your accountant for advice. .
4. Great bookkeepers do the homework A sign of a really great bookkeeper is one who is up to date on what is happening in the bookkeeping, accounting and technology spaces. The bookkeeping and accounting industries have evolved considerably over the past few years due to changing technologies.
Your bookkeeper should be explaining to you and encouraging you to use technology to save time and money by automating processes with cloud accounting packages.
A recent survey shows that small business owners save an average of 10 hours a month just by using bank feeds, a service that links your bank account to your accounting software. After using bank feeds, I think that figure is on the low side and could easily be doubled.
5. Great bookkeepers are people you can trust. Finally, the relationship between a client and a bookkeeper is sacred. Most people won’t share their financial details with friends or even family, yet this person is privy to everything – especially if you are using one account for business and personal but that’s another article altogether.
Make sure you like your bookkeeper, that you trust them and feel comfortable being completely honest with them. Your bookkeeper cannot help you get the most out of your accounts if you are not being completely transparent with them.
Source: ICB Newsletter August 2014 /MYOB