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How To Know If You Can Trust Your Bookkeeper

Trusting Your BookkeeperIn our prior post, we talked about how to find an outsourced accounting service you can trust. But you may still be left with some nagging doubt. There are so many cases of bookkeeper fraud and company theft. How do you know you can really trust your bookkeeper? Especially if you’ve been burned by an in-house bookkeeper in the past (and that’s more common than you might think for small-to-mid-size business owners!) you may not want to put your financial statements in the hands of someone you don’t know and have never met.

Let’s take a look at how the processes and procedures established at a virtual accounting firm like AccountingDepartment.com make all the difference when it comes to trusting your bookkeeper, accountant and financial controller. Here are five things we do differently at AccountingDepartment.com when it comes to the processes and procedures we have in place for all our bookkeeping and accounting clients.

1. The accounting service has a built-in system of checks and balances.

One of the problems with an in-house bookkeeper is that rarely does another employee check the work or even look at the books at all. Most business owners hire a bookkeeper because they don’t have the time or knowledge to maintain and balance their own books. They are unlikely to spot errors in the event of company fraud.

By including a full-charge bookkeeper and a controller on every account, a natural system of checks and balances is established to spot errors and oversights. The controller works to oversee the bookkeeper, and this includes spotting errors, as well as anything that doesn’t seem right or could be a red flag.

2. Your bookkeeping company issues--and uses--a Client Procedures Manual that was put together with your input.

When we onboard a new client, we create a thorough Client Procedures Manual, as well as a formal Service Level Agreement that details the services we will provide. The CPM outlines the processes and procedures we use, including financial statements to be shared, timelines for all documents and how they will be delivered.

Clients trust that our bookkeepers will do exactly as expected because it’s all outlined in writing. We wouldn’t be in business if we didn’t stick to our word.

3. Your full-charge bookkeeper receives, and uses, paid time off, including vacation time.

An in-house bookkeeper who never takes any time off may be a red flag that you could be a victim of accounting fraud. If your bookkeeper has been “cooking the books,” he or she won’t want anyone else with their hands on the records, because they might notice something isn’t right.

Our bookkeepers are full-time employees, and as such, we give them generous sick leave, paid time off, and vacation time. Because of our Client Procedures Manual and the processes and procedures we instill when we train new bookkeepers, it is easy for another bookkeeper to step in and manage your books on a temporary basis. In addition to the controller who oversees your books, you will know that your bookkeeper will never be the only set of eyes on your financial records.

4. Your bookkeeper works in a secure home office.

It’s not always the in-house bookkeeper that steals from the company, but it is often a result of his or her negligence that makes it possible to steal. From setting passwords that are easily hacked, leaving a computer screen and QuickBooks open without password protection, or even leaving the drawer unlocked that holds the check book or petty cash, there are a number of ways in-house bookkeepers make it possible for employees to steal.

At AccountingDepartment.com, our bookkeepers work completely virtually, with all checks and payments issued electronically so there is no opportunity to steal or leave information unsecured. They operate from secure home offices across the U.S., accessing secured servers without the ability to print, remove or download files. This system, which includes virtual checking and payments, makes it very hard for any of your in-house employees to work with your bookkeeper to steal, or for your bookkeeper to inadvertently take actions (or neglect taking action) that would make it easier for other employees to steal. It’s difficult, if not impossible, to replicate this level of security in most offices.

5. There is an established procedure every month for closing the books and, at that time, that month’s bookkeeping records are locked so no one can change them.

At the end of each month, on the date dictated by your CPM, you and your AccountingDepartment.com team (your controller and your full-charge bookkeeper) meet virtually and complete a process called “closing the books.” At this time, we review your general ledger, match all transactions against credit card statements, bank statements, bank receipts and other receipts, and ensure that everything is accounted for and the books “balance,” with every transaction showing an equal and opposite transaction.

When everything checks out, we “close” the books with your approval and no additional changes can be made. This ensures that you have reviewed your bookkeeping records, along with other trained eyes, and agree that the information is true, accurate and up-to-date.

From the first step to the last, the right bookkeeping company has established procedures that create trust and security for the client. We take away motives, we take away opportunities, and we leave business owners with greater peace-of-mind about the trustworthiness of their bookkeeping team.

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