Sooner or later, your business will likely need to hire a bookkeeper to help manage your accounting data and tasks.
Some business owners do their best to keep their own books as a cost-saving measure (more than one-third, in fact—or 34%—say they manage their bookkeeping personally).
Too often, however, these entrepreneurs do a poor job of keeping their records or end up neglecting their books and bank reconciliations in favor of bigger priorities. In either case, they stand to lose time and money when their books fall into disarray and they’re forced to play catch-up.
Hiring a bookkeeper to record and categorize your transactions on a day-to-day basis is the best way to keep your financial information organized and up-to-date, so you can:
- Manage your cash better
- Make realistic plans for the future
- Stay focused on running your business
While finding the right professional for your needs can take time, these 5 pointers on how to hire a good bookkeeper will make your job easier.
1. Hire the right type of bookkeeper
Is your small business still in its growth phase? If so, now might not be the best time (expense-wise) to invest in a full-time bookkeeper. Instead, consider a more reasonably priced option like hiring an in-house bookkeeper part-time, or outsourcing your accounting to a third-party firm.
Part-time (or freelance) bookkeepers
Hiring locally for your bookkeeping job can be an affordable way to have a qualified professional:
- Come into your office part-time
- Manage your physical paperwork
- Keep your accounts up to date
There are a few potential drawbacks to this arrangement, however.
In the event of your bookkeeper falling sick or going on vacation, there'll be no one to cover their work. Worse, if they quit or disappear suddenly, trying to figure out where your accounts are at—and transitioning to a new bookkeeper—can be painful and time-consuming.
There’s also the risk that, if your business grows too big or too quickly, your part-time bookkeeper will have trouble scaling with you—especially if they’re juggling multiple clients.
Third-party bookkeepers
Hiring a third-party or virtual firm is another affordable bookkeeping option. While these firms are usually remote (meaning they won’t actually come to your office) they’re also digitally savvy. That means they’ll be able to digitize your receipt collection and invoicing processes to make them more efficient.
Another big advantage of working with an outside bookkeeping service is that, because they typically operate as a team, there’ll always be someone available to manage your books.
Better still, most third-party firms offer additional services—like dedicated payroll, accounts payable, and accounts receivable management for example—that allow them to meet your changing bookkeeping requirements as your business grows.
2. Verify their industry experience
Because bookkeeping practices can differ between industries, it’s important that the bookkeeper you hire has verifiable experience with businesses like yours. If they’ve only ever worked with clients in the restaurant industry, for example, they may not know how to keep proper books for a nonprofit organization.
A good bookkeeper should know how to:
- Set up your chart of accounts (based on your business type and needs)
- Categorize your daily financial transactions
- Generate your financial reports
Don’t be afraid to ask where a bookkeeper’s years of experience have been spent—and perhaps even ask them some technical questions.
3. Consider other services they offer
In addition to evaluating their bookkeeping knowledge and skills, learning how to hire a good bookkeeper means weighing the benefits of any add-on services they offer. Having to hire someone separately to manage your payroll, for example, can drive up your bookkeeping expenses.
It’s also worth noting that, with bookkeepers and accountants offering different expertise, some firms (like Enkel) also offer specialized services (like fractional controllership) to make your business growth journey easier to navigate.
4. Make sure they’re familiar with accounting technology
Bookkeeping with spreadsheets and Microsoft excel may work fine when your business is just starting out, but relying on manually-entered data over time can make accurate financials a challenge.
Good bookkeepers don’t just understand the benefits of using accounting software for keeping books precise and making processes more efficient, they’re also:
- Familiar with the desktop software most businesses use
- Capable of migrating your books to a cloud-based software like QBO (QuickBooks Online)
- Able to recommend apps and technology tools for automating certain data entry tasks
Make sure you ask about their familiarity with specific accounting systems and software before hiring an otherwise qualified bookkeeper.
5. Confirm their credibility
Getting a referral from someone you trust can be a good way to gauge the credibility of a potential bookkeeping hire. This might include asking your accountant, your banker, other business owners, or your local professional association for recommendations.
If you’re considering hiring a bookkeeper you’ve discovered online, it’s especially important to:
- Ask for client references and/or case studies showcasing their work
- Speak directly with past or existing clients
- Use the information you gather to determine their fit and trustworthiness
Remember: With 98% of owners agreeing they’d prefer to focus more on business growth than on tasks like bookkeeping, understanding how to hire a good bookkeeper is all about prioritizing your time.
If you’re ready to hire a trusted bookkeeping professional—one who’ll provide accurate books and timely financial reports, while saving you both time and money—Enkel can help.
We offer monthly bookkeeping, payroll, and other back-office accounting services to small & medium-sized businesses across Canada. Contact us to find out more about our customized bookkeeping services.
