How to Find the Right Bookkeeper

When it comes to your business, money management is essential. Many small business owners don't hire a bookkeeper because they worry about having to devote too much time and attention to this aspect of their business. You don't want your story to end up like Rebeca, who works in the construction industry, but due to unmanaged books, she faced severe penalties by CRA.

While there are some tasks you can do on your own (like tracking your cash flow), if you want to ensure that your business's financial records are in order, the best thing you can do is hire a qualified bookkeeper to take over these responsibilities from you.?

We have experience cleaning up many business books, done by "well-meaning" family members.?

Here are some things that you need to consider while hiring a bookkeeper for your small business.

Are They Registered?

Business owners who hire unregistered accountants or any type of professional can face severe penalties. Accountants must have an active certificate and file it with their province's division of corporations (or similar government office).?

That means your potential accountant will likely be listed in a public database online.

The link below is the British Columbia Member Directory Available to the Public found on the CPABC website, ensure to check the list for your province.

https://services.bccpa.ca/imis/directory/publicmemberdirectorynav

If they don't appear in a search, you might want to avoid working with them on principle alone—but you should also research their background (like checking out their LinkedIn profile or Google reviews) before hiring them.

Databases aren't perfect, and sometimes mistakes are made — such as listing an individual as active when they moved out of the province years ago — but every bit helps. So make sure your potential new bookkeeper is properly registered.

When deciding whether to work with a specific company, look at these key areas:?

1. Financial expertise
2. Availability and responsiveness?
3. Fees/costs/rates
4. Reputation within your industry
5. Experience

Most importantly, remember that choosing a bookkeeper is not just about what makes sense for your business. You need someone you trust so you feel comfortable sharing sensitive information like financial data about your business – including tax returns – which could come back to haunt you if it falls into unauthorized hands.

Do They Have the Right Credentials?

Secondly, make sure that your bookkeeper has all of the proper certifications. It's essential to ensure that you can trust their work; if your business is audited and it turns out that you didn't have a qualified individual looking after your books, you could lose everything.?

The CPA designation is perhaps most recognized in accounting circles, but many CPAs also become Certified Bookkeepers (CBAs). With additional training, they learn how to handle businesses' financial transactions better—and they must pass multiple tests before being awarded their credentials.?

Some areas require bookkeepers to be licensed or registered as well. Check your government website for more information on what is required. You should also look into whether or not there are any other organizations that offer certifications in bookkeeping or accounting. For example, some organizations offer certification specifically for QuickBooks users—which can be helpful if you use QuickBooks as your accounting software!?

Finally, check with your insurance provider about whether or not having a certified accountant on contract will lower your premiums. If so, then hiring one may end up saving you money in addition to providing peace of mind!

Check Prior Experience

The best bookkeepers are not necessarily going to be those with a background in accounting, but rather people with experience doing what you want them to do.?

For example, if you are looking for someone who knows QuickBooks inside and out, it might make sense to look at a bookkeeper with prior experience setting up QuickBooks.?

If you want someone with experience dealing with lawyers, investors or the CRA, ensure that you’ve made a list of your must-haves.?

If you are in a specialized industry like construction, look for someone who has experience working in your industry.

A good match will understand what's expected of them and will be more likely to stick around. When reviewing potential bookkeepers, remember that many will have varied skill sets, education, and experience.

Found yourself with multiple candidates??

• Consider an in-person meeting or zoom call. A great way to see how they interact and how well they communicate (which is especially important when it comes to financial matters).
• Ask about what you can expect each week/month from them and the anticipated response times to your questions.
• Ask how they protect their clients’ accounts, internal controls and segregation of duties.
• Ask them to give a few examples of common bookkeeping issues related to your industry and how they would resolve them.
• You could also ask to talk with one of their clients or an accountant that they work with.

Consequences of Hiring a Bad Bookkeeper

Like any skilled professional, good bookkeeping can help you run your business more efficiently and profitably. A bad one can bring your business – and maybe even your whole life – crashing down.

Think about it; if you underreport income, you might be assessed penalties by the CRA. If you don't pay taxes on time, expect an audit. You could face fines or worse: Your business license might be suspended or revoked; tax liens may be placed against your property; court orders could force you into involuntary bankruptcy, and civil or criminal charges may result in jail time. Ouch! And that's just for starters.

Bottom Line

The tax-paying time comes up faster than expected, and you need to be ready for that all the time. So, you need a good bookkeeper to take care of all that, but it's tough to know who will do great work at a fair price. And if you get someone who isn't great, they could mess up the books and cause you all kinds of headaches (not to mention financial losses).?

So how do you find a great bookkeeper when you have no idea where to start??

Here are 4 tips that can help.

1. Make sure their website clearly shows what they offer and how much it costs.?
2. Look around for reviews from previous clients so that you can make sure they really understand accounting and tax law. Google reviews are a great place to start.
3. Check their references, including any past clients you can contact directly.?
4. And finally, hire a bookkeeper who specializes in your industry—they'll be more familiar with any issues specific to your line of work.?

Finding a great bookkeeper doesn't have to be hard, but it does take some effort on your part. But once you've found someone who gets your business and makes managing your finances easy, it will all be worth it!

Although this blog offers business advice, this content is for general informational purposes only—it is not intended to replace the guidance of a licensed legal or financial professional. Information created by third parties that we may link out to or feature on our site is not endorsed by us and remains the responsibility of such third parties.?Bookminders Services Inc.?assumes no responsibility for errors or omissions in the content.