Navigating Bookkeeping Challenges: When to Double-Check Your Bookkeeper’s Work
Working with a small digital media company, I’ve come to rely on a reputable Bookkeeping team from a larger firm that handles our taxes effectively. However, I’ve noticed a recurring issue that leads me to question the norms of Bookkeeping practices.
A Persistent Need for Oversight
Despite the team’s good reputation and the premium fees we pay, I find myself diligently reviewing their work. This isn’t out of mere caution but necessity. There have been numerous cases where deposits are inaccurately categorized, which affects the way revenue is divided among our diverse business endeavors.
The Question of Standard Practices
This brings me to a pressing concern: Is it commonplace for bookkeeping firms to rely on the default categorizations provided by tools like QuickBooks, without tailoring them to the client’s specific needs? Should it fall on the client to comb through the software to rectify misclassifications?
The Role of a Proficient Bookkeeper
Ideally, a skilled bookkeeper should proactively identify and correct such clear-cut misclassifications. It’s not about possessing insider knowledge but about paying attention to detail and understanding the client’s business structure. If these errors are apparent enough for anyone to detect, a diligent bookkeeper should catch them as well.
Conclusion
Given these circumstances, it may be worth revisiting the terms of your agreement or discussing these concerns directly with your bookkeeping team. Ensuring clarity and accuracy in financial records is crucial for sound business operations, and it’s important to establish whether your current team’s practices align with industry standards.
One response
It’s understandable to be concerned about your Bookkeeping team’s performance, especially when it directly impacts the financial accuracy of your business. In your situation, there are a few important points to consider that could illuminate the issue and guide your next steps.
Firstly, while it’s not uncommon for small discrepancies or oversights to occur in Bookkeeping, consistently having to check and correct categorizations should not be standard practice. A skilled bookkeeper should engage closely with your business’s specific operations, financial details, and unique needs. They should go beyond using default categorizations in QuickBooks or any other financial software, particularly when handling complex matters such as revenue splits across various business lines. This requires setting up custom categorizations that mirror your specific business activities and ensuring that transactions are recorded accurately the first time.
Misclassifications can indeed lead to bigger issues, affecting everything from managerial decision-making to compliance with financial reporting standards. Therefore, it’s essential for the Bookkeeping service you employ to proactively communicate with you and understand your business model in detail. Good bookkeepers should seek clarification wherever uncertainties arise, sometimes even necessitating periodic meetings to discuss financial statements, Accounting practices, and any specific categorization needs you might have.
If you find yourself correcting the same issues repeatedly, it might be time to have a candid conversation with the bookkeeping team about your expectations and the specific challenges you’re facing. Here are some practical steps you might consider taking:
Set Clear Expectations: Discuss your specific bookkeeping needs with the team, including how you want transactions categorized and any unique business elements they should be aware of. Document these requirements to ensure there is a solid reference point for accountability.
Feedback Loop: Establish a process for providing regular feedback on their work. This can be part of a monthly review where both parties discuss what went well and what needs improvement.
Training and Resources: You might offer to provide additional context or training regarding your business model. Sometimes, a knowledge gap might exist, and bridging that can help your bookkeeping team perform more effectively.
Performance Evaluation: Consider if the frequency of errors justifies the cost of the service. It might be worth exploring other bookkeeping services or even bringing someone in-house who can better cater to your business’s specifics, if the current issues persist.
Software Utilization: Ensure that the bookkeeping team is utilizing all features of QuickBooks or any financial software to its full potential. Sometimes, underutilization of software capabilities can lead to ineff