A bookkeeper can definitely be one of your best allies when you are running a business, and they serve not only to keep your books and accounts recorded and properly balanced but also to give you useful advice and tell you how your business is faring and where it is going. Working on your business’ finances is not an easy matter, so if you have someone doing it for you and taking care of your daily transactions and other financial requirements, then you can focus on other tasks that enable your business’ growth. But if you have already determined that you need a bookkeeper and are just thinking of what qualifications you should look for – and how to find one – here’s your best guide.
Essentially speaking, bookkeepers are different from accountants in that accountants need to have certain professional qualifications that allow them to legally perform their duties. But your bookkeeper needs to have at least some level of education or experience. Some qualifications would include an AAT (Association of Accounting Technicians) diploma, which is also a basic qualification for an accountant, although bookkeepers cannot sign off year-end accounts for Companies House submission.
It would also be a good idea to check for a diploma in bookkeeping from the IAB or Institute of Associate Bookkeepers, or CIMA/ACCA Levels 1 and 2 for bookkeeping. It would be best if they are a member of a specific professional authority or body, ensuring that they are updated with their continuing professional development or CPD and are well-versed with the latest regulations and laws. You can also request copies of their Public Liability and Professional Indemnity insurance.
The thing about bookkeeping is, you can always hire someone who doesn’t have much experience or is just starting out in their profession. But if you want more peace of mind, then go for bookkeeping services with a minimum of three years of experience.
The process of bookkeeping isn’t just about making sure numbers are entered into a ledger – it will also require a good understanding of how a business works and functions and how a business is managed from day today. The day to day management of a business involves the flow of information as well as the flow of cash, and your bookkeeper needs to have a good idea of the entire process and how it works. You can also check whether the bookkeeping service has a certain degree of experience when it comes to businesses within your own sector or industry. Some industries or sectors are more specialized than others, such as manufacturing or construction, so if you are in a more specialized sector, it may be worthwhile to check for a bookkeeper who has worked with similar businesses in the past or continues to do so.
The control of credit
Here’s another aspect that not many make take into account: credit control. Proper cash flow is vital, and the control of credit is a skill that only the best bookkeepers have mastered. While you can rely on a bookkeeping service to manage your credit, make sure to check and monitor how they perform. Even if you have found a great bookkeeper, but you are not satisfied with how quickly they are collecting your payments from clients, then you may want to consider other options.