10 Questions to Ask a Potential Bookkeeper

If you’re sick of dealing with the shoe box full of receipts it could be time you hired a bookkeeper. It’s good practice to get to know your potential bookkeeper well as they are going to be responsible for a big part of your business and you want to ensure it’s the right fit. If they are not a part of a large firm, will they be able to handle the workload? What types of businesses do they usually deal with? Do they understand the needs of your industry? It’s better to take your time to find the right person/ firm straight up than to have to start all over again in a matter of months because it’s not working out.

Here are ten questions to help guide you through this process:

1. What qualifications and professional memberships do you hold, and are you a registered BAS agent?
The Tax Agent Services Bill 2008 (in effect since 1st March 2010) means that anyone providing BAS services for a fee needs to be a registered BAS agent. If your bookkeeper is processing BAS work, then this is a necessary requirement.

At a minimum, your bookkeeper should have qualifications such as Certificate IV Financial Services. Look for someone who is a member of one of the various professional bookkeeping associations in Australia such as The Institute of Certified Bookkeepers (ICB) or the Association of Accounting Technicians (AAT).

2. What insurances do you have?
At a minimum, professional indemnity insurance is desirable.

3. Who will undertake the data entry and BAS preparation?
Establish whether the work will be consistently undertaken by the same bookkeeper or by any member of the team and whether the work will be reviewed.

Bookkeeping Guide

4. What experience/references do you have?
References may not always be reliable, but it is worth taking the effort to do a little research. Many websites offer independent reviews of professional services.

5. If the work is done in an accounting package, who retains the ownership of the data file?
Many bookkeeping organisations will process the work on their own data file, which will save you the expense of purchasing the software upfront. If at a future date you wish to bring the bookkeeping in-house, the transfer of ownership will cost a nominal fee. Of course, if the accounting system is set up in the cloud, such as Xero, the data can be accessed from anywhere by anyone with a log in. The subscription ownership may be held by the bookkeeping organisation, generally if they are a part of the original set up of the account.

6. Where will the work be done?
Will the bookkeeper work onsite, offsite, or remotely?

7. Who will be responsible for rectification work?
Mistakes may date back years; corrections can be costly exercises, involving re-keying data, reworking BAS, and reviewing end-of-year financial statements. Will the bookkeeping work be redone free of charge or will the charges be reimbursed?

8. What does the bookkeeper require to process the work?
Establish what your bookkeeper will need from you on a regular basis. Do they want the receipts sorted? Are you required to write account codes or explanations on the receipts? Unless you’re paying extra for mind reading services I would expect this to be the case.

9. How will the bookkeeper communicate with your accountant?
Where your accountant and bookkeeper are not a part of the same firm, it is advised to introduce them and to encourage a professional relationship between them. Without this connection, there may instances where open lines of communication suffer. When this happens you suffer too, so you need to establish how the bookkeeper will communicate with the accountant, and how the accountant will charge you.

10. What will it cost?
The elephant in the room is that the work of bookkeepers is vastly undervalued. If you pay peanuts you get monkeys. Once you have found your bookkeeper don’t simply outsource and ignore. You need to look at your management reports on a timely basis and incorporate them into your decision-making processes.

We’ve made a bookkeeping guide free to download to help Trades Business keep their books in order and up to date. It’s a simple and practical guide made with the growing small business in mind.  You can download it for free here. If you need to book a free consultation you can Contact us today.

Ellen Mubwandarikwa