Questions your new bookkeeping firm should ask

Last week, we looked at what to expect if you are shopping for a new bookkeeping firm in January. This week, let’s take a look at some signs of a good bookkeeping firm. In particular, there are three questions your new bookkeeping firm should ask you, either during the proposal process or shortly after beginning the bookkeeping engagement.

Question #1: Can we evaluate your books?

In my opinion, your new bookkeeping firm (such as Lalea&Black) should ask to evaluate your books before they even provide a proposal. This is the only way your new firm can provide you with an idea of what work needs to be done to correct your books or bring them up to date. After evaluating the books the firm will be able to give you a more accurate idea of what their services will cost. Perhaps most importantly, an experienced bookkeeper can look at a client’s books and devise a plan to provide the client exactly the services they need.

In my firm, we charge a small fee to evaluate a prospective client’s accounting file. In return, we provide them with a written line-by-line analysis of their balance sheet, an in-depth review of their P&L, and a list of recommended process improvements. This report is the prospect’s to keep and use, even if they decide to engage a different bookkeeping firm. We are also able to draft a plan to clean up the prospect’s books and tell them exactly what to expect in terms of price. This clear communication is vital during the first months of our relationship with a new client, and you should expect no less from your new bookkeeping firm, especially a nonprofit bookkeeping firm.

Question #2: Can you provide us with your most recent tax return?

Many new clients balk at this request. Rest assured, there is a very good reason your new bookkeeping firm should ask you for your most recent tax return. Your balance sheet in your accounting file should always tie out to the information provided on your tax return. If it doesn’t, fixing this is the first step in the cleanup process.

Why is this important? Seth David gives some very good, practical reasons here. From my point of view as a bookkeeper, I feel relatively confident the information provided on a client’s tax return is accurate. Ensuring the balance sheet agrees with the tax return gives me a good starting point for any additional cleanup that is needed on a client’s books. I can then know without a doubt the client’s books are as accurate as possible and that they can use their bookkeeping to make sound financial decisions.

Question #3: What is important to YOU?

I’ll be the first to admit it: we bookkeepers often get mired in the technical requirements of our work. We want the balance sheet to balance. We want those bank accounts reconciled to the penny, dammit! Even those of us who don’t believe the sole purpose of good bookkeeping is to be able to easily prepare a tax return at year end want the books accurate for tax purposes.

All of these things are important, However, providing our clients with meaningful financial information is the most important thing a bookkeeping firm does. While the standard accounting reports provide valuable insight, every client’s needs are different. Your new bookkeeping firm should ask you what is important to YOU as a business owner in order to be able to provide you with the information you need.

Other questions your new bookkeeping firm should ask

I deem these three questions the most important when engaging a new client. There are many more questions your new bookkeeping firm could ask you. These questions should always focus on your needs. As long as the focus remains on your needs as a business owner, you can feel confident you have chosen a good bookkeeping firm.

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