Do you need to hire a bookkeeper for your business?
Are your business accounts becoming too tedious for you to handle?
Perhaps you simply want to improve efficiency by having someone else do your booking.
If so, then you need to hire the services of a professional bookkeeper.
A bookkeeper will help you manage your business accounts, keep records of important financial transactions, and handle other recordkeeping tasks.
This makes it easy for you to know the state of your accounts, it is also easier to generate financial reports that let you know how you are doing financially.
Statutory and legal reports are also a breeze when you have up to date financial records
Thereby helping you save your business from incurring financial loss and other legal financial penalties.
However, to enjoy excellent bookkeeping services, you need to find the right person for the job.
How do you go about it?
This is what this blog post is all about- to guide you on how to hire a bookkeeper so that you do not take the wrong steps and experience regrets later on.
So, stay with us as we walk you through the necessary steps to take to hire a bookkeeper.
How To Hire A Bookkeeper
First things first, before we walk you through the steps on how to hire a bookkeeper, there are certain things that we feel you should know.
- understanding who a bookkeeper is (that is, the job specification)
- understanding a bookkeepers’ roles, duties, and responsibilities
- The necessary skill set of a bookkeeper
- The benefits of hiring a bookkeeper for your business.
Understanding these will help you know what a bookkeeper can do for you.
Chances are that you already know all these things, which is why you’re in search of a bookkeeper in the first place.
However, for this blog post, we’ll be discussing them in detail.
Hence, stay with us.
Who Is A BookKeeper
A bookkeeper is an individual who is tasked with maintaining and managing a business’s financial records or transactions.
These could be anything from maintaining the company’s purchase records, expenses, taxes, invoices, etc.
Unlike what most people think, a bookkeeper is quite different from an accountant.
While their job roles seem similar, their functions, responsibilities, and job descriptions are quite different.
Let’s examine what both entail to understand their differences.
To understand the concept of bookkeeping, here are the roles and responsibilities of a bookkeeper
Roles and responsibilities of a bookkeeper
- keeping records of financial transactions/reports
- maintaining and balancing the businesses accounts and general ledgers
- overseeing a business’s financial data
- posting debits and credits
- providing invoices
- compiling the organization’s payroll
- among other things
- compile and present financial statements
- analyze financial data and produce financial reports for the business
- manage the business’s inventory
- administer all accounts payable (debts) and accounts receivable (credits) of the business.
- verify purchase orders
- calculate and prepare tax payments
- file tax reports etc.
Accounting, on the other hand, entails the following
- analyzing recorded financial data
- preparing financial statements/reports like tax income returns, income statements, balance sheets, etc.
- forecasting business trends and viable opportunities for growth/financial forecasting
- financial consultancy
- account audits
- overseeing and managing the businesses’ finances
- among other things
Now you understand that a bookkeeper is quite different from an accountant in terms of what they do.
Furthermore, before you hire a bookkeeper for your business, you should be well acquainted with these roles.
This is so that you know what to look out for in a bookkeeper.
Hence here are some of the skills a good bookkeeper should possess.
- Firstly, a college or degree is not necessarily needed to be a good keeper, but having a degree can be an added advantage.
- A level of professional expertise that comes with several years of working experience.
- Good communication skills (written and oral)
- Organization skills
- Ability to pay attention to details
- Good work ethics (integrity, honesty, transparency, etc.)
- Proficient with computer, Microsoft Office, and other relevant bookkeeping technologies or software such as Quickbooks, Google Docs, etc.
- Numeracy (comfortable dealing with numbers or calculations)
- Retentive memory etc.
Some of the benefits of hiring a bookkeeper for your business include;
- You’ll have more time in your business to handle other aspects of the business.
- It ensures proper cashflow management.
- More so, when you hire a bookkeeper, there are fewer errors in calculations and keeping accounts.
Thereby preventing you from making financial errors that could destroy your business.
- With a bookkeeper in your business, the occurrence of fraudulent acts would be minimal.
- Likewise, it reduces the chances of your business defaulting financial obligations such as late payment of taxes and business debts.
- Lastly, hiring a bookkeeper will reduce your workload, stress levels and prevent you from burning out.
Guidelines On How To Hire A Bookkeeper
Here are some simple guidelines on how to hire a bookkeeper.
1Consider The Size And Structure Of Your Business
The first guideline for you planning to hire a bookkeeper is considering your business’s size and structure.
By this, we mean conducting an in-depth analysis of your business to determine if you need a bookkeeper.
It will be a huge mistake on your path if you decide to hire a bookkeeper just because other businesses are doing it.
Yes, it’s good to follow recent business trends.
However, incorporating such trends into your business without proper timing and planning could lead to business failure.
This is why this is a crucial first step to take before hiring a bookkeeper.
Hence, consider your business size and structure.
As a small business just starting, especially on a very tight budget, hiring a bookkeeper might not be smart.
This is because there are so many business expenses and cost of operation that you need to handle.
As such, hiring a bookkeeper will further strain your tight business budget.
More so, since you’re just starting, your business bookkeeping needs will be fundamental.
Hence, you could save your business some extra money by doing some of the bookkeeping tasks in addition to using some basic bookkeeping software.
2Be Timely With Your Decision To Hire A Bookkeeper
There’s nothing like being timely with your actions.
This way, your actions are more effective and productive.
Peradventure, you didn’t hire a bookkeeper at the initial stages of your business to reduce operating costs.
Now, your business has grown to a significant level; this might be the right time for you to hire a bookkeeper.
However, the big question is, how do you tell it’s the right time.
Well, certain signs tell, it’s time to get a bookkeeper for your business.
Some of the signs that tell it’s time to hire a bookkeeper.
- The bookkeeping tasks are becoming too tedious, and it’s taking up a valuable portion of your time at work.
- You’re becoming late on your tax payments and other states/federal obligations.
- Too many errors or inconsistencies in the business’s financial accounts.
- The business’s cash flow is being mismanaged.
- Employees’ payroll is becoming too difficult to manage.
- You know nothing about balancing accounts and ledgers.
Overall, when you notice some of these occurrences in your business, it’s an indication that you need to hire a bookkeeper’s services.
3Consider Your Businesses’ Bookkeeping Needs
This is another thing you must do before you hire a bookkeeper.
This is because it will determine the kind of bookkeeper you’ll hire, either an independent bookkeeping consultant or a bookkeeping firm.
Most bookkeeping firms are well equipped to handle the demanding bookkeeping needs of large businesses.
Similarly, most independent bookkeeping consultants also handle the bookkeeping needs of several clients.
Whichever bookkeeping agent you decide to use for your business, they would be capable of handling your business needs.
It all depends on your business needs and, of course, the cost and your business budget.
4Use Your Social Networks To Find Eligible Candidates
After analyzing your business and established that you indeed need a bookkeeper for your business, it’s time to set out searching for one.
Not just anyone, but a good bookkeeper that will be efficient and productive.
The big question is; where do you start from?
Sometimes, most business owners are lucky enough to get referrals from other business associates who have worked with one or more bookkeepers.
Luckily, some of these referrals turn out to be worth it.
If you have no one to refer a good bookkeeper to you for hire, your social network is an easy place to start your search.
It would surprise you to know the number of skilled people you have in your social networks, especially on Linkedin.
All you need to do is to indicate your need for a bookkeeper, either by simply posting a job ad or sharing the message across your social network.
However, for a more professional outlook and to get some of the best hands, it’s best to create and post a job ad.
In the job ad, ensure to add a job description, specifications, job requirements, and other important detail that’ll explain what you need in a bookkeeper.
5Review Various Applications
After reaching out to your social network and posting a job ad in search of a bookkeeper, chances are that you’ve gotten tons of applications.
What do you do next?
Do you pick up any bookkeeper that comes to mind to start working right away?
The next step of action is to review various applications to see those that fit the job description.
You’ll get different applications for the job than you actually need.
Hence, it’s up to you or your hiring team to sift through these applications, searching for those that stand out from the crowd and meet the job description.
6Assess The Bookkeeper’s Skills And Competence You’re About To Hire
The next step to take in hiring a bookkeeper is to assess the applicants’ skills and competence.
This can be an interview process where you have a conversation with the applicants and ask a series of questions to help you access their skills and competence level.
Here are some vital questions you should ask the intending bookkeeper.
Questions you should ask before you hire a bookkeeper
What is the level of expertise?
In any profession, there are varying levels of expertise.
Also, with higher levels of expertise comes higher levels of efficiency.
The various levels of expertise include;
- Fundamental Awareness: This means knowing how things work in a particular field or industry.
- Novice: Such a person is just starting in the industry and, as such, has limited experience.
- Intermediate: At this level, the individual has had several practical experiences working in a particular field.
- Advanced: This level of expertise comes from having in-depth knowledge of certain applied theories in a particular field/industry.
- Expert: Here, the individual has mastered the art of his/her field and, as such, has become a recognized authority in that field/industry.
Overall, these levels of expertise come with several years of training and working experience.
Hence, the higher the years of working experience, the better for your business.
This is because the individual (bookkeeper) will have an adept understanding of the industry and how best to help you achieve your business goals.
What qualifications, certifications, training, and education does the bookkeeper possess?
Another important question you should ask the bookkeeper you intend to hire is his/her qualifications.
While a college degree is not a prerequisite for being a bookkeeper, it’s still necessary that the bookkeeper you intend to hire has some necessary training and education.
Hence, the bookkeeper should have at least intermediate training or education in the necessary procedures for bookkeeping.
Is he/she proficient with certain bookkeeping systems or software?
Thanks to the advancement in technology.
Certain applications, systems, or programs such as FreshBooks, Quickbooks, Xero, etc., are designed to make bookkeeping more efficient.
Hence, the bookkeeper you intend to hire should/ must be proficient with most of these specialized programs.
How much are you charging for your services?
This is also a crucial question to ask.
Most bookkeepers would have the price at which they’ll offer their services.
Most times, this price goes higher, depending on their level of expertise and the complexity of your bookkeeping needs.
This will help you know if it’s what your business can afford or not.
Having asked these questions and more, you can tell if the bookkeeper is right for the job.
Then you can proceed with other relevant discussions and arrangements.
7Discuss/Negotiate The Bookkeeper’s Rate
Now you know how much the bookkeeper is willing to charge for his/her services, it’s up to you to decide if it’s something you’re willing to offer or not.
If the price is on the high side, you should negotiate with the bookkeeper.
Negotiating prices will help you both settle on a mutually beneficial ground.
8Discuss Working Terms/Condition
After all, is set and the bookkeeper is ready to work with you, it’s time to set some working arrangements with the bookkeeper.
If you just hired a freelance bookkeeper, then the bookkeeper will most likely work remotely.
As such conditions like working hours wouldn’t apply to him/her.
This is because most freelancing professionals have flexible working hours.
However, there should be set rules that establish when completed tasks should be delivered to you.
Also, if you’re hiring a bookkeeping company, there’ll be certain policies that guide their mode of operations.
Hence, it’s best to discuss some of these policies regarding the services they offer.
More so, you should also discuss the method of delivery, it is via email, or google drive, dropbox, etc.
You should also discuss the payment method, will it be a monthly payment or at the end of every task?
It’s always important to discuss these things when hiring any professional service.
This is so that there are no issues in the future due to certain misconceptions.
9Discuss Method Of Communication
Another thing you shouldn’t fail to do when hiring any freelancing professional is to have a means or mode of communication.
Communication is key to the success of any relationship, be it personal or professional.
Hence, to enjoy the best working relationship with the bookkeeper you hire, ensure to discuss the method or means of communication.
If the bookkeeper is working remotely for you, chances are that you both might be in different countries.
As such, you both might have different timezones.
If this is so, then it’s best to have a conversation with the bookkeeper about the time and manner of communication.
This is to ensure an effective and productive working relationship.
10Start With A Trial Period
It’s always best to start a trial period with any job offer, and hiring a bookkeeper is not an exception.
This is because a trial period gives you time to test the capabilities of your intending hire.
More so, you’ll get to see if the new hire fits into the organization either as a virtual or physical team member.
This is why you must start with a trial period before finalizing the work arrangements.
It could be for a few weeks or days.
After the trial period and the new hire shows a positive work attitude and delivers a positive result, you can proceed to finalize other work arrangements like signing a work contract, among other things.
Conclusion On How To Hire A Bookkeeper
It’s a wrap on the guidelines on how to hire a bookkeeper.
We started by explaining who a bookkeeper is, his/her functions, roles, and responsibilities.
We also tried to explain the difference between an accountant and a bookkeeper by listing their different functions.
Now you know some of the characteristics to look out for in a bookkeeper.
Furthermore, we shared some important tips/guidelines on finding, assessing, and hiring a good bookkeeper for your business.
It all starts with analyzing your decision to hire a bookkeeper, identifying your business needs and financial capability, and looking within your social network.
Afterward, you review and assess the desired candidate(s) for the job, after which you have some important discussion about some working arrangement.
Remember, hiring a bookkeeper has numerous benefits for your business, including proper cash flow management and accurate financial records.
It would also help you grow your business better by giving you more time to focus on other aspects of the business.
Hence, make the right decision by using these simple guidelines to hire a good bookkeeper for your business.
Lastly, don’t forget to leave a note on how helpful this post was to you in the comment section below.
We are eager to hear from you.