How and Why to Develop a Relationship with Your Bookkeeper

by | May 12, 2021

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In conversations with current and prospective clients, and even when I speak with friends and family about our business, most have a predefined understanding of what a bookkeeper is and does.  A lot of people think a bookkeeper is someone who they hire at a little over minimum wage to write their checks, pay their bills and enter transactions.  It may be someone re-entering the workforce who has taken a class or two.  It may be someone with some background in a clerical role with some admin experience.  It may be a spouse or a friend of a spouse who wants to help out the business.  Regardless of your preconceived notions, however, there are some important reasons that small businesses need to increase their understanding of the role and reframe their approach to hiring.

Understand the Potential

Bookkeeping at MSBP mirrors the role of a corporate controller.  Our comprehensive and systematic approach involves tracking the money, ensuring accuracy, applying best practices, creating efficiencies in accounts payable and accounts receivable (even advising on how you are handling collections with clients!) and ongoing financial reporting. Our systems are designed to deliver a superior level of service to our clients and we make it a point to keep you informed should we notice anything out of order in your financial world.

We often find ourselves cleaning up after the discount bookkeeper who managed the books before us.  While sometimes they categorize transactions properly, we have also seen accounts with $25,000 in uncategorized expenses and a list of negative balances on your balance sheet. (Accounting tip: the only time you should see a negative number on your balance sheet would be for depreciation and amortization, but hopefully NOT in the equity section. Even though it may be accurate, you want those numbers to be positive!)   We’re not saying all inexpensive bookkeepers are useless, but it is important to be critical about what value they are really providing.

We want to be the financial partner that helps you grow your business.  Your bookkeeping role should not be reduced to a data entry person.  They should be someone who knows how to interpret the larger picture, supports you in understanding your financial position and leverages that understanding to help you grow your business.

 

Worst Case Scenarios

Would your bookkeeper be able to tell you if one of your employees were embezzling money? A good bookkeeper should be able to identify fraud – or at least bring to your attention that something is amiss and work with you to figure out what it is.  For one client, we discovered that her daughter and minority business partner was helping herself to distributions…from the cash register.  For another, when we followed the trail of monthly adjustments to categorize sales, we discovered our client’s spouse had pilfered $30,000 from the business. 

Consider the story of famous gangster Al Capone in The Untouchables (Accountants Can Be Small Business Heroes).  The case that finally brought him to justice was led by the FBI accountant. (For another fun story of embezzlement, you can watch All The Queen’s Horses, a documentary about the comptroller of Dixon, IL, who stole $53 million of public funds over the course of 20 years.)  Our clients affected by dishonest business and life partners didn’t necessarily hire us for forensic accounting or to build a case.  These things were discovered in the normal course of MSBP business bookkeeping because our approach is so thorough.

 

A Relationship-Based Role

When you find someone you trust to create, monitor and analyze the money trail of your business, you’ve gained a valuable partner in your business.  How do you find – and nourish – that relationship?  We have some simple suggestions.

  • Hire a professional partner to handle your finances. They should have a legitimate business and depth of knowledge.  You don’t want to harm your business (or your marriage) by asking your spouse to pick up bookkeeping skills.  Every small business needs to provide financial information to various parties.  It is crucial to have a legitimate professional assembling that documentation.   
  • Your bookkeeper should be asking you questions and communicating with you. They cannot operate effectively in a vacuum and should be engaging in ongoing dialogue about aspects of your business and your accounts.  The better they understand your business and your expenditures, the better they can organize the information and create meaningful reports.  If they aren’t asking questions, it’s likely you aren’t getting your money’s worth. (Or maybe you are and you’re getting what you pay for.)
  • Your bookkeeper must be trustworthy. This extends far beyond confidentiality and money matters.  They need to be someone you can count on and lean on, consistent in their communication and on-time with their reporting.  You should be able to have authentic conversations with confidence that they will hold you accountable in your planning, your process and your profitability

Relationship is a two-way street, however, and your behavior reflects your values.  If you are unresponsive to questions, cancel or miss meetings or treat your bookkeeper disrespectfully (or worse, allow your colleagues to do so), you will likely lose one of your most valuable assets.

How do you define the term bookkeeper?  Are you looking for data entry OR do you want someone who has a comprehensive understanding of your finances and guides you in your business? 

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At My Small Business Pro, we recognize the importance of creating enduring relationships with our clients.  We learn their business, understand their priorities and help them refine their operational approach.  Does this sound like exactly what you need?  Call us today.

MEET THE TEAM: Milen Gomez, Staff ACCOUNTANT

6 months ago, we added a new staff accountant to our team: Milen Gomez. Our newest staff accountant is the best we could ask for with her incredible attention to detail and efficient mindset. She has been an essential part of our continued growth by always putting her...

Client Spotlight: Danielle Suchala Klausing

It’s always an exciting time when you’re ready to take the next step in life and buy a home. But finding that perfect home can be a challenge, especially if you’re not familiar with the real estate industry. That’s where Danielle comes in. With over 7 years of...

Who is responsible for payroll?

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Meet the team: Eileen Manaloto, Sr. Accountant

Despite a job market full of unique challenges, My Small Business Pro was incredibly fortunate to bring on a new team member last year, Eileen Manaloto. Like many small businesses, we got creative in finding the right resource to support our amazing clients and fit...

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