3 Things to Know About Hiring a Bookkeeper

By Roxanne Coffelt |

Business Evaluation Services Indiana

Who does your books?

Now you might be thinking I want to sell you some bookkeeping services.  Actually, I don’t.  I work with bookkeepers and see a lot of work that was done by bookkeepers, both good and bad.  Sometimes even well-intentioned bookkeepers who don’t have a good grasp on what they’re doing create more work for people like me, and more expense for business owners who have to pay for someone to clean it up. 

Do you ever wonder why your tax return preparation is so expensive?  It might be that your books are not in very good order.  Accountants, including tax preparers, are often not assertive enough to tell their clients that something is wrong with their books.  Often, they fix what they are aware of, year after year without telling the client.  The things they aren’t aware of don’t get fixed, however.  This may result in something as benign as the wrong expense description, or it may result in costly changes to your tax return in the event you are audited.

Just the other day I was explaining to a new client about some problems with their books.  I asked about the bookkeeper and was told the bookkeeper was Quickbooks certified.  Unfortunately, Quickbooks certification is only about using the software, not about bookkeeping.  So, I decided to write this article to help people know what to look for when hiring a bookkeeper.


For a bookkeeper, training is important.  They need to understand the basic accounting equation and the difference between debits and credits.  (Several years ago, I heard of an entry-level accounting class that didn’t use debits and credits – I would not recommend that!)  For a very small business, like a sole proprietorship, an entry-level class successfully completed is probably sufficient, as long as there is a professional available to answer questions when needed. 

Intermediate accounting would be recommended for somewhat larger businesses, including corporations or partnerships.  These businesses need balance sheets, so the bookkeeper needs to have a good foundation in double-entry accounting.  Though taught in beginner level classes, completing an intermediate-level class (usually the second year), would ensure they had a good understanding and aptitude.

"Experience will never teach you the things you didn’t learn in accounting class."

If your business is in manufacturing or construction, it would be very helpful for your bookkeeper to have successfully completed a class in cost accounting.

For larger businesses, you may need more than one accountant.  Your accounting manager or CFO should have an accounting degree and experience.  The job of a CFO is for another article.

I cannot stress how important training is for any accountant or bookkeeper.  Experience will never teach you the things you didn’t learn in accounting class.


For a bookkeeper, while experience is a plus, I don’t think it is as important as accounting training.   Where experience does matter though, is in the particular type of software you are using.  Quickbooks certification is a plus but be aware that Quickbooks online is very different from Quickbooks desktop.  (Desktop will be going away at some point, as most accounting software companies are moving to a cloud-based platform.)  While Quickbooks seems to be everywhere, it may or may not be right for you.  There are many other options out there. If you don’t know what software you are going to use yet, an experienced bookkeeper (or your CPA or EA) may be able to help you with that decision.

Consider other software that your bookkeeper may be working with, besides your accounting software. Some examples might be:

  • Excel (or other spreadsheet)
  • Word (or other word processor)
  • Accounting software plug-ins such as inventory, billing , cash projection, or time-tracking
  • Industry-specific software
  • Customer Relationship Management (CRM) software
  • Data analysis software

Also consider what your bookkeeper’s particular responsibilities will be, what skills are needed, and whether they have experience in those specific areas, such as:

  • Accounts receivable (collections, communicating with customers, receiving payments)
  • Accounts payable (writing checks, possible access to funds, dealing with vendors)
  • Reconciliations (problem-solving abilities, attention to detail)
  • Cash flow management (problem-solving abilities, prioritizing, analyzing procedures)
  • Payroll (dealing with confidential employee information)
  • Financial statement preparation (solid training, organizational skills, presentation skills)


This article is about qualities that pertain specifically to bookkeepers.  Obviously, there are other qualities as well that you look for in all your employees, like someone who is dependable, hardworking, etc.  I am only going to mention one here, and that is trustworthiness because it is so important.  Your bookkeeper has access to sensitive information.  They may have access to cash, bank accounts, valuable assets, employee information, etc.   A bookkeeper that is given free rein can often make off with a substantial amount of money before they are caught, and a few are probably never caught.  Imagine finding out that your bookkeeper has been writing checks to himself or herself.  Imagine finding out that your payroll taxes haven’t been paid even though your books say they have been, and your bookkeeper has been hiding IRS notices from you.  Imagine finding out that your income has been vastly under-reported.  Could you handle not only the financial loss, but the stress that goes with it?  You may think it can’t happen to you, but I have seen all of those things happen to people who never thought it would happen to them either.  Depending on your internal controls, which is another subject, a dishonest bookkeeper can cost you your entire company.

In Closing

It is not my intent to scare anyone.  Rather I want to impress on you how important it is that your books are correct, and your bookkeeper’s role in this.  Most bookkeepers mean well, but many are not properly trained for their jobs.  Accountants like to joke about the “Mrs.” degree, meaning the wife of the owner automatically becomes the bookkeeper.  The feeling is, somebody has to do it, so why not? If the bookkeeper role has been delegated to you for whatever reason, and you enjoy doing it, more power to you!  If you don’t enjoy it, hire someone to do it so you can spend your time doing something more productive.  If you enjoy it but don’t really know what you’re doing, please take a couple of accounting classes.  (Business owners, if you have stuck your spouse or another family member with the books, this applies to them!)

Accounting mistakes can be very costly.  A good bookkeeper is worth every penny!  If you would like a free copy of my questions for interviewing bookkeepers, please click below.*

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