Bookkeepers offer a vital business service. They save you time by handling all the daily financial work for you and allow you to concentrate on the running of your business.
With so many to choose from how do you find the one that suits your business best – here are a few tips to take into consideration when choosing a bookkeeper.
Every bookkeeper should have had some level of formal business and accounting education. Ask to see their professional qualifications and accreditations. Suitable qualifications would include the following:
AAT Diploma –The Association of Accounting Technicians qualification is the basic one for a qualified accountant although they can not sign off statutory year end accounts for sumbission to companies house
Diploma in Book Keeping via the IAB – the Institute of Associate Bookkeepers
ACCA / CIMA levels 1 and 2 should be sufficient for book keeping.
They should also be a member of a professional body to ensure they are kept up to date with their CPD (continuing professional development) and latest change to the laws & regulations. Also ask to see copies of their Professional Indemnity and Public Liability insurance.
Look for a bookkeeper with at least three years working experience.
Bookkeeping is not just about entering numbers into the ledger. It also requires a thoughtful understanding of the business, managing the day to day input of information, outflow and inflow of cash, and much more. Check whether they have experience of working within your trade sector. Some areas such as construction can be specialised and if possible appoint a bookkeeper with knowledge of your industry.
Like most professionals, the less experienced and less qualified bookkeeper will usually be cheaper. However judging bookkeepers by the hourly rates they charge is not the best way to compare costs. An experienced bookkeeper will cost more but should work significantly faster and smarter than those less experienced. Instead, compare the total cost taking into account the expected hours needed each month, not just the hourly rate.
Cash flow, or lack of it, can make or break any business. Credit control is a specialist skill and the personality traits that make a good bookkeeper are often not those you would associate with someone who's good at encouraging customers to pay up.
Most bookkeepers will offer credit control as part of their package, but make sure you monitor their performance here closely. If you've found a good bookkeeper that you can work with, but you're not happy with how quickly you're collecting payments from customers you do have other options. For example you can outsource the credit control separately or hand over any late collections to a commercial debt recovery service.
The relationship between a client and a bookkeeper is based on trust. Make sure you meet them before you enter into a business agreement. You need to like, trust and feel comfortable around them before handing over your confidential information. It's also a good idea to ask to see client testimonials / references.
Accounting software is getting more and more advanced. Your bookkeeper should be up to date on all the latest software and processes. They should be encouraging you to use these latest technologies such as cloud accounting packages which will save you time and money