How do I know if my bookkeeper is doing a good job?
Start with bank reconciliations. Your bookkeeper should reconcile every bank and credit card account monthly, and those reconciliations should be done within the first two weeks of the following month. If it’s March and your December reconciliations aren’t finished, that’s a problem. Ask your bookkeeper when reconciliations are typically completed and verify that the reconciled balance matches your actual bank statement.
You should receive financial statements regularly. At minimum, a monthly profit and loss statement and balance sheet. These reports should arrive consistently, not just when you ask for them. If you have to chase down your bookkeeper for basic financial information, that’s a sign of poor communication at best and incomplete work at worst.
The numbers should make sense to you. A good bookkeeper can explain what’s happening in your reports without hiding behind jargon. If you ask why expenses jumped last month, you should get a clear answer. If your bookkeeper can’t explain discrepancies or gets defensive when you ask questions, you don’t have a true partner in your finances.
Tax time reveals a lot. When your accountant prepares your tax return, do they have to make significant adjustments to your books? Do they send back a long list of questions and missing information? Clean books mean your CPA can work from what your bookkeeper prepared without major corrections. If every tax season involves reconstructing your financials, your ongoing bookkeeping isn’t working.
Check your accounts receivable and accounts payable. Are customer invoices being tracked properly? Do you know who owes you money and for how long? Are vendor bills being recorded before they’re due? Aging reports should be accurate and current. If you’ve been surprised by an overdue bill or a customer payment that fell through the cracks, your bookkeeper might not be staying on top of these accounts.
Watch for proactive communication. A good bookkeeper notices things and tells you about them. They’ll flag unusual transactions, point out cash flow concerns before they become emergencies, and ask clarifying questions about expenses they don’t recognize. If your bookkeeper only speaks up when you initiate contact, you’re not getting the full value of the relationship.
Your balance sheet should balance and make sense. Retained earnings should accumulate logically from year to year. Accounts shouldn’t have random balances that nobody can explain. If your bookkeeper can’t walk you through your balance sheet line by line, there may be errors hiding in those accounts.
Finally, consider whether you feel less stressed about your finances. A small business bookkeeping service that’s working well takes things off your plate. You’re not worried about whether your numbers are right. You’re not scrambling to find documentation. You have confidence in your financial picture. If bookkeeping still feels like a source of anxiety rather than relief, something isn’t clicking.
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