Every business owner comes to realize, eventually, that they will need to outsource certain duties in order to remain successful. One such duty that is extremely popular to delegate is bookkeeping. Bookkeeping takes a keen eye for detail and requires time that is much better spent on other tasks.
Utilizing an external source for your bookkeeping needs should mean less stress for you and the confidence of knowing your records are in good hands. However, if you find yourself in a position where this is not the case, it might be time for a change. Take a look at these three reasons that prove it is time to start the search for someone new, before tax season arrives.
Reason #1: The books are late.
This one is obvious, you and your bookkeeper have a remarkably simple relationship, you pay them, and they keep track of your records and complete your books in a timely fashion. If your bookkeeper is routinely late in delivering your books, alarms should be going off.
Most businesses prefer to have the books closed monthly. That means comparing the books against your bank statement, to be sure that everything is correct and accurate. The information you need, the financial statements, are what your bookkeeper is preparing. If the books are not closed, you will not know if your statements are authentic. The financial statements are crucial for so many other areas of your business, including budgeting, and even understanding the wellbeing of your business. Not having your books done on time, every time, is a significant liability for any and every business owner.
To put it simply, a bookkeeper that cannot follow your deadlines and complete the work in a timely fashion, is not a bookkeeper that is right for you. You should start looking into other bookkeeping service providers as soon as possible.
Reason #2: There are communication issues.
Bookkeeping as an extremely important aspect of your business, your financial records are essential, so you want to avoid bookkeeping vendors, and have a bookkeeping partner. Although you are paying someone else to take care of your records, you still need know what is going on with them. There will be times where you will have questions and you need a bookkeeper you can rely on to answer said questions.
You must keep in mind that your bookkeeper most likely has numerous clients such as yourself, so expecting them to be available to you at all times is unreasonable. A good bookkeeper will have no issues scheduling a time to discuss all of your questions and concerns about your books.
When you ask your bookkeeper about your records, they should be able to explain what they did and why they did it. They should also be willing to listen to any worries you might have. If you ever feel that your bookkeeper is disregarding your concerns or unable to answer your questions, then the relationship might not be a good fit.
Reason #3: There are errors in your books.
Bookkeepers are not flawless, mistakes can and do occur. However, if errors keep happening repeatedly, this is a red flag. The accuracy of your books is critical to maintaining the health of your business. If your bookkeeper is constantly making mistakes, your financial statements are no longer reliable, and it is nearly impossible to make proper financial decisions for your business. Not only is that detrimental to your business, the whole point of outsourcing your bookkeeping was to save time! A bookkeeper that continuously makes mistakes means you must then go over all of their work regularly to be sure the information is true. This contradicts the whole purpose of having said bookkeeper.
Although there could be many reasons for the errors in your books, a common one is an understaffed bookkeeper. If your bookkeeper does not have the time to carefully go over their work, the likelihood of errors is increased. Another reason there could be mistakes is your bookkeeper may not be familiar with the way your specific business needs the books done. Bookkeeping can be complex; you need to have a bookkeeper who understands the issues your books might have due to your specific industry.
The quality of your books is paramount, you need to be able to trust your bookkeeper, or it is time to hire someone new. Financial records are the foundation of any business. Ultimately, you need to have a bookkeeping service that you can trust to deliver on time and as accurately as possible, with open communication. If these basic requirements are not being met, it is a major sign that things need to change.