The Ultimate List of things you NEED to know about your Bookkeeper/Accountant

Aug 31, 2023

Things you NEED to know about your bookkeeper/Accountant

If you are outsourcing your accounting functions or hired someone in house, you need to understand EXACTLY whose hands are in your cookie jar.

I’m not talking about the owner or CPA that is the head of the firm you spoke with who is a great salesman with years of experience. I’m talking about the individual responsible for your account…the one who has access to all of your personal passwords and visibility into your financial history…the one who is getting paid $22/hr while you’re being billed $95/hr.

As a business owner, it is your responsibility to know who has ownership of your innermost, top secret financial secrets, and how competent they are.

Here’s the ultimate list of things you need to know about your bookkeeper/accountant:

#1 – What is their name?

This sounds simple! However, in a firm, accounts are passed off to different people all the time just like any other business. As people take PTO, get promoted, leave, etc…accounts and work are redistributed. You need to know who is at the helm of your ship at every change.

Even within a firm, there will be junior and senior level bookkeeper/accountants. Know who is entering your information and when. Heck, I would even treat them to lunch here and there just to keep that relationship strong.

The importance of your finances cannot be underestimated! This position should be treated with the same level of respect and vigilance as any of the other business functions (sales, marketing, or operations, etc.).

You should have a good relationship with the person doing your books. They should feel comfortable asking you questions and even pushing back sometimes, and vice versa. You WANT someone skeptical asking questions to better understand your business.

If there is no consistent dialogue, it could be that your business is easy and straightforward, but it could also be a sign that things are left unattended and transactions are going to the wrong places.


#2 – What is their accounting background?

At a minimum, they should have an accounting degree with Principles of Accounting I & II and Intermediate Accounting Principles I & II under their belt. This should ensure transactions are receiving the proper professional skepticism and analysis. Yes, there are plenty of great Bookkeepers or self-proclaimed Accountants who do not have these credentials…but ask yourself? With so many options a click away…don’t I deserve the best?


#3 – What was their GPA?

Lol – hey, if you don’t want to pony up the dough for a Fractional CFO or full time Controller, you need someone who understands accounting theory, not someone who barely passed a couple of Intro to Accounting classes as part of their art history degree. If Bookkeeping and Accounting are a commodity, then you can afford to choose one that is above average.

A Quickbooks certification is NOT related to Accounting in any way. A QB certification “validates newly acquired QuickBooks skills for an entry-level position…” – Intuit 2014


#4 – How many other clients are they handling?

If they are juggling too may other clients, expect mistakes here and there. Relax and don’t panic. That is normal. Mistakes are ok! That’s how we learn, but you want to know your bookkeeper/accountant has enough time to get things done right, and is dedicated to your business. You may or may not get a transparent answer on this, but it doesn’t hurt to ask.


#5 – Who is their Supervisor? How many people are they supervising?

Accounting and Finance are critical pillars to your business – you need to know what the internal structure is, just like they need to know yours so they can provide the best possible service. What are the credentials of their Supervisor? How often are they collaborating on your account?


#6 – What Accounting controls are in place?

Is your Bookkeeper/Accountant reconciling the important accounts after each month end (Cash, Credit Cards, Loans, Depreciation, Inventory, AR, AP, Assets, uncategorized transactions?)?

It’s typical for accounting books to close after the first or second week of the next month. By keeping things up to date, you can trust the financial statement reports being run from your accounting system. These numbers will support business decisions and strategy. If they are not current, there’s a problem.


#7 – Do they really understand your business/industry?

Just like with any occupation, you’re going to have some really great partners, and some really lame ducks. Strong accounting and finance professionals will understand your business holistically. Be sure to ask what kind of training did they get on your business.

Where they included in the initial meeting of your account? If they weren’t, then you’re playing the kids game of Telephone, and hoping information gets passed on correctly. If that’s the case, you’re trusting someone you’ve never met before as well as their communication processes.


#8 – Did they insist you stop booking personal transactions on your business accounts?

If they are letting you slide with personal expenses, they aren’t a champion of efficiency or ethics, and you are both costing yourself money and time. Are you making it easy for them by keeping expenses separate?

A big part of the CFO role is making things efficient and holding Leadership accountable to best practices.


#9  –  Who has access to your banking and credit card information?

Your business needs to hand over authority and permissions to get bookkeeping done efficiently, but that doesn’t mean everyone in the firm should have the ability to write checks from your business account. Ask what the file permissions are that house your information.


#10 – What is the security protocol surrounding your personal information when they need to access it?

2FA (Two Factor Authentication) is the norm. Make sure your personal identification has these controls, and you are available to them when they need your sign off.


#11 – What is the password management software being used? Are your passwords safe?

With cyber terrorists becoming more and more educated, your passwords need to be unbreakable with limited sharing. Every person in the password chain is a failure point.

You need a password management system that will keep threats at bay. There are plenty of high end password management tools out there as well as IT solutions such as MSP’s (Managed Service Providers) that handle this situation for various companies.


#12 – Does the firm have cyber liability insurance?

You are trusting another company with your financial passwords, information, and assets. You MUST account for “worst case scenario.”

Worst case scenario is something that needs to be addressed, and your company needs to be compensated for disasters. Insurance is a primary driver for worst case situations. You do NOT want your company to go into a tailspin because your Bookkeeping/Accountant was not up to date on the newest Cyber-liability laws and practices. Honestly, this should maybe be #1.


#13 – What is the IT infrastructure being used to protect your information? How many servers? Are they using the cloud? Do they have a back up and disaster recovery process in place?

Leaving your business open to theft, fraud, or cyber-attacks is asking for catastrophic damages. It’s not enough to know about the password management software and insurance…your business needs to feel secure that physical infrastructure is in place to deal with cyber-terrorism. That sense of security comes from knowing IT experts are being proactive in protecting your information.

“Let the Experts be Experts”  – I love this mantra.

Finance is one realm of expertise, but cyber security is a completely different realm. As a business owner, you need to be educated on cyber-threats and backup disaster recovery. All it takes is for one unplanned event or one employee to open the wrong phishing email, and everything you’ve worked so hard for is compromised.

If your Accounting firm doesn’t have an IT solutions partner in place, you might want to find one who does.


Whew! That was a lot! But worth it – trust me.

If your company is depending on a Bookkeeper or Staff Accountant to guide you…there’s a lot of experience left on the table. this is where a Fractional CFO can help before a full time payroll expense.

Hopefully these questions will provide you with a framework to hire a Rockstar Bookkeeper/Accountant!

If there are questions or comments, please let me know at: [email protected]