- April 3, 2018
- Posted by: Rivero, Gordimer & Company
- Category: Business Advice
Having a skilled and competent bookkeeper is a critical part of a successful organization. After all, the bookkeeper manages the finances for the entire company and likely has a better sense of the firm’s financial stability than anyone — maybe even more than you.
With the right bookkeeper in place, you can focus on running the company and making strategic decisions founded on accurate financial information.
Quality bookkeepers are invaluable assets to your business. They mitigate the risks of accounting errors and also help identify operational inefficiencies. These are just two of the many reasons to have a good, trustworthy bookkeeper.
Unfortunately, finding the right bookkeeper isn’t always easy.
If your current bookkeeper isn’t living up to expectations and you’re wondering if it might be time to start searching for a new bookkeeper, ask yourself if you’ve observed any of the following six signs. If you have, it might be time to fire your bookkeeper.
They Are Making Too Many Mistakes
If your bookkeeper is continuously making mistakes and you are investing time reviewing their work, it’s probably a sign that they are unqualified for the position.
It’s a red flag the moment you start questioning the expertise and knowledge of your bookkeeper.
An experienced bookkeeper should understand how to execute their job with minimal supervision. Moreover, they should have any report or document readily available when you request it.
If you find yourself double-checking their work or they are unable to provide you with inaccurate or outdated reports, it’s a good sign that they are not qualified to meet your needs.
To operate your business efficiently, you need full confidence in your bookkeeper and the accuracy of the information they provide.
When bookkeepers make frequent mistakes, they become a liability. You are entirely justified in firing a bookkeeper that cannot provide flawless work on a consistent basis.
They Can’t Keep Up with The Work
As with any position, it’s vital that employees are capable of managing their workloads and hitting deadlines. This is even more critical for your bookkeeper.
Accurate financial statements, reconciliation, and cash flow reporting are necessities for any business. As a business owner, you must make strategic decisions based on available information. If that data is irrelevant, it becomes difficult to make those decisions confidently.
Falling behind on financial reporting and account reconciliation is a common issue with bad bookkeepers. If your bookkeeper is missing deadlines and falling behind, it could be time to move on.
They Don’t Understand Your Business
Good bookkeepers should provide insight and strategies to improve your company’s bottom line. They should be familiar with your industry and your organization’s standard business processes.
Many industries have specific tax codes and breaks that can improve the profitability of your firm. Your bookkeeper should understand those intricacies and approach you with ideas on a regular basis.
Because bookkeepers understand the day-to-day financial operations of a business, they should see inefficiencies and opportunities before anyone else.
For instance, if one of your clients is consistently paying you late and causing stress on your operational cash flow, your bookkeeper should present you with that information so that you can decide how to resolve that issue.
When your bookkeeper is not approaching you with insight or ideas, it may be time to fire them.
They Cause You to File Tax Returns Late
For some businesses, a bookkeeper also helps prepare tax documents at the end of the year. If your bookkeeper is tasked with providing you the important documents needed to file your taxes and they are delivering those documents late, it’s time to move on.
Late filing of tax returns can have significant consequences on your business. Moreover, if it happens multiple times, it’s a sign that your bookkeeper lacks accountability.
While everyone makes mistakes and filing a late tax return can happen, if it becomes a theme every year — that’s a sign of a more significant issue.
They Don’t Explain the Financial Statements
The average business owner isn’t a bookkeeper — which is why you hired somebody in the first place. Therefore, your bookkeeper should clearly explain your financial information when requested.
Some bookkeepers become defensive when asked about their financial records or avoid presenting important financial data to managers.
Whether they are timid because they fear scrutiny of their work or they simply don’t have the information ready, it’s a red flag when a bookkeeper isn’t willing and able to walk you through financial reports,
You Aren’t Getting What You Paid For
Running a successful business requires careful valuation of processes and people. If you’re not receiving an equal exchange of value with your vendors, suppliers, or employees, then you need to take the necessary steps to remedy the discrepancy.
Your bookkeeper is no different. You know what you’re paying your bookkeeper, and you know what you should be receiving. If those don’t align and your expectations are not being met, it’s time to make a change.
While it is never easy to fire an employee, business owners must be willing to make those difficult decisions if they want to succeed. Your bookkeeper should provide more than just accurate financial statements; they should be a valuable asset to your strategic decision-making process. If that is not the case, it may be time to fire your bookkeeper.
If you’re looking for an experienced CPA firm to handle your bookkeeping, contact the Tampa CPA Firm, Rivero, Gordimer & Company.