Running the financial and accounting operations of a small business is a complex, time-consuming task. Yet it’s also one of the most critical parts of making sure your company survives and thrives. That’s why hiring an experienced bookkeeper should be one of the first investments you make as a new entrepreneur.
In this guide, we’ll walk you through everything small business owners need to know about bringing a bookkeeper onto their team and the inside advice from experts about hiring a bookkeeper for a small business.
Follow along below for the complete playbook on finding and working with a bookkeeper to establish sound, insightful financial tracking and reporting for your growing company.
The Array of Tasks an Excellent Bookkeeper Handles
When searching for tips on hiring a bookkeeper for a small business, first understand the wide range of activities an effective bookkeeper can reliably execute for your organization, including:
- Recording day-to-day financial transactions from accounts payable and receivable, employee expense reimbursements, vendor invoices, customer payments, payroll expenditures, credit card activity, and any other cash inflows and outflows
- Ensuring all entries adhere to general accounting standards and best practices for proper documentation
- Preparing accurate financial statements and cash flow reports on whatever monthly, quarterly, or annual basis you need
- Reconciling accounts across ledgers, bank statements, and credit card accounts
- Conducting expense, inventory, profitability and other key financial analysis to uncover trends and insights
- Staying on top of sales tax calculations and payments to stay compliant
- Tracking fixed assets and liabilities
- Completing and filing timely payroll tax returns, 1099 forms, and other tax documents
- Preparing year-end financial reports and other data needed for formal tax filing
Having a skilled bookkeeper to handle these critical items means less stress for you as a small business owner. It also saves you significant time that can be reinvested into focusing on sales, marketing, product development, and customer service priorities more central to growth.
Vital Skills and Experiences to Require in a Bookkeeper
Now that you appreciate the long “to do” list a bookkeeper can reliably own for your small business, let’s look at the key background and capabilities to verify in anyone applying for this crucial role on your team.
Formal Education & Certifications
At minimum, your bookkeeper should have some sort of post-secondary education in accounting or finance principles. This is often an associate or bachelor’s degree related to bookkeeping, accounting, or business management. For advanced credentials, look for applicants with specific certifications like:
- Certified Public Bookkeeper (CPB)
- QuickBooks Certified User (QBCU)
- Microsoft Dynamics Credentialed Specialist
Industry Experience
Alongside education, your ideal candidate has direct experience handling full-cycle bookkeeping responsibilities for other companies in your specific industry. This ensures they understand the quirks and intricacies that differ across retail, non-profit, manufacturing, professional services, healthcare, and other small business types when it comes to finances.
Software Proficiency
Today's accounting is largely digital, so make sure any bookkeeper you consider hiring has demonstrated capabilities using small business bookkeeping platforms that enhance efficiency and accuracy. Based on your current tech stack, that may require you to assess their familiarity with solutions like:
- QuickBooks Online or QuickBooks Desktop
- Xero
- Zoho Books
- Wave Accounting
- FreshBooks
The stronger their existing skills across relevant programs, the less training you’ll have to provide upon onboarding.
Precision & Time Management Strengths
Bookkeeping is fundamentally about careful attention to detail spread across high transaction volumes. So outside core education and experiences, vet candidates thoroughly for strengths in:
- Accuracy - Proven ability to spot errors and correct them is vital
- Organization – They’ll be handling lots of paperwork and need to keep it structured
- Time Management – Reporting deadlines must consistently be met
Pay close attention if any past employers or clients cite weaknesses in these areas during your screening process.
Communication Skills
Your bookkeeper will serve as the hub for all financial information flowing through your company. That makes communication abilities paramount for success in this role.
- Can they explain financial reports and trends clearly to non-finance staff?
- Will they proactively share important notifications and warnings?
- How responsive have they been historically to emails or phone calls?
This is an area many small business owners overlook in assessing bookkeeper candidates, only to be frustrated later by delayed responses or confusing data hand-offs.
Once you’ve aligned on the right bookkeeper for your small business needs, we recommend formalizing your working partnership with a detailed service agreement covering scope, responsibilities, fees, confidentiality, and other parameters.
Optimizing Workflows & Communication
Laying out clear expectations and processes is vital for ensuring your bookkeeping relationship remains as efficient and collaborative as possible. Be sure to address:
Agreed Upon Timelines
Spell out exactly when they will provide financial statements, tax forms, payroll reports, and any other key documents you rely on to run operations. Build buffer room on deadline commitments accounting for review and any error correction needed.
Required Information Flows
Provide granular guidance on what data or original documentation they’ll need you to share and by when for smooth financial tracking. This may include bank and credit card statements, receipts, invoices, inventory records, payment confirmation notices, and other evidence to reconcile against the books. Establish a transfer system to make this easy instead of scrambling every month.
Check-In Meeting Cadence
Even with reliable email availability from your bookkeeper, regular face-to-face or video meetings are still important for deeper discussion. Cover what insights they’re seeing in the numbers along with any concerns that may be emerging to address early before problems escalate.
Feedback Channels
Ensure you have clear ways to provide suggestions, process improvements ideas, or performance criticisms as needed that they’re receptive to receiving. Positive, constructive communication makes for better collaboration over years.
Treating them as a Trusted Advisor
While handling routine bookkeeping tasks, great bookkeepers become critical advisors spotting financial trends, warning signs, or ideas for improving profitability. Treat them as part of your leadership brain trust, not just a behind the scenes function.
When structured effectively, these working rhythms with a talented bookkeeper provide small business owners invaluable expertise and bandwidth to focus on accelerating strategic growth priorities.
What to Expect from a Bookkeeper's Rates
As with hiring any skilled professional it’s important to discuss and agree on compensation rates upfront when bringing a bookkeeper onto your small business team. Bookkeeper fees often follow several possible set-ups:
Hourly Billing
Many independent bookkeepers or accounting firms charge per hour worked, with higher rates tied to seniority level and specific services like tax preparation carrying premium pricing. Expect hourly rates to range from around $30 on the low end to $100+ for CPAs handling your books. Be sure to clarify policies around minimum hourly commitments.
Monthly Retainers
Some firms offer fixed fee monthly packages covering an agreed upon routine scope of bookkeeping support hours and duties. This allows easier budgeting for the service compared to fluctuating hourly invoices. Just confirm what is covered versus “extras” you may be charged more for.
Increasing Scale for Growing Complexity
Most bookkeepers structure pricing on a tiered model where fees rise in sync with your revenue, transaction volumes, reporting needs, tax obligations, or other complexity factors expanding over time. Check that they can smoothly handle your upward growth.
In-House Wage Considerations
Some larger small businesses reach an inflection point where hiring a full-time dedicated staff bookkeeper proves more affordable than extended outsourced help. Just account for salary, benefits, potential overtime, training costs, and HR burdens that come with building out your own team.
No matter what fee methodology you select, always revisit the cost structure yearly to ensure it still aligns win-win with the value being provided.
When to Consider Transitioning from Your Current Bookkeeper
Finding the right bookkeeper relationship you can rely on for the long-term transforms how well you understand and manage your small business finances. But no partnership is perfect. Be on the lookout for these signs it may be time to explore a replacement:
Errors are Creeping In
Mistakes happen, but consistent inaccuracies in financial statements point to a struggling bookkeeper. These undetected errors can severely impact planning decisions and put your tax compliance at risk over time.
Reporting Delays Have Surfaced
Routinely missing deadlines on tax filings, payroll submissions, monthly closes or other key reports erodes trust and hurts responsiveness. See if there are workflow issues you can correct before frustration mounts.
Communication Has Stalled
When your bookkeeper grows difficult to reach suddenly or meetings suffer from confusion more than clarity, financial illumination suffers. Attempt open conversations addressing any roadblocks before relationships fray beyond repair.
Unhelpful Insights & Analysis
You want your bookkeeper to go beyond basic reporting to spotlight trends, risks, and growth opportunities from the numbers. Set expectations clearly if their deliverables lack strategic guidance.
Their Availability Hits a Ceiling
Sometimes your small business simply outgrows your accounting partner over time as your financials scale up in complexity. Be proactive about identifying warning signs if they become overwhelmed before problems cascade. No hard feelings – just be ready to level up support.
What smart small business owners realize is that risks from previously minor shortcomings in a bookkeeper get magnified over time. So stay vigilant for growing issues and be ready to have candid conversations addressing them or exploring alternative options before they severely impact your company’s trajectory.
The Key Role an Exceptional Bookkeeper Plays
After reviewing all the moving parts around identifying, hiring, and keeping excellent financial help – let’s recap the immense value gained when you get this critical piece of your entrepreneurial foundation right.
Offloading tedious but completely necessary accounting work frees you up as a passionate small business owner to point more energy into the strategic initiatives that ultimately govern growth and competitiveness.
On top of the administrative assistance, an empathetic bookkeeper provides financial insights you wouldn’t spot on your own until major problems creep up. Their perspective keeps you focused on the metrics and activities that really matter.
Leveraging Technology for Enhanced Bookkeeping
As the amount of financial data flowing through modern small businesses explodes, so do the technology solution options for effectively managing all that information. Cloud accounting platforms and purpose-built bookkeeping software both play pivotal roles in enabling accurate tracking in an efficient manner.
Cloud-Based Accounting Systems
Solutions like QuickBooks Online and Xero allow remote access by an outsourced bookkeeper to record transactions as they occur in real-time while keeping business owners fully up-to-date through automated reporting. This facilitates seamless collaboration while reducing manual effort. Just ensure your bookkeeper is already highly familiar with your chosen platform.
Bookkeeping-Focused Tools
Around central accounting data hubs as mentioned above, various supplemental programs bring optimization for specific financial workflows. Invoice and billing management software like Freshbooks and Wave reduce accounts receivable headaches. Expense reporting apps like Expensify improve VAT reclaim and employee spend tracking accuracy. Payroll dedicated solutions like Gusto maintain compliance across paycheck calculations and filings.
Integrations Are Key
The more your crucial small business programs interlink into your bookkeeping software, the greater transparency and insight becomes available. Review what connectors your current or future accounting platform provides for seamless cross-communication with sales, inventory, POS, ecommerce, CRM and other vital operational systems.
Automating for Bookkeeping Efficiency
Manual data entry bottlenecks waste hours that drag down output speed and increase risk of numerical errors. Discuss what workflows your bookkeeper recommends structuring for partial or full automation based on your unique finances. This may span areas like:
1. Importing bank and credit card files directly into accounting software
2. Apps pre-categorizing expenditures from linked spending activity
3. AI-powered transaction classification as records enter the books
4. Rules-based coding for customer payments or refunds
Properly built workflows, integrations and automation provide small business owners and their bookkeeping partners hours of liberated time to focus on more judgement-intensive financial strategizing.
Implementing AI for Enhanced Bookkeeping
One of the newest opportunities to elevate small business financial management is to incorporate AI-powered bookkeeping. These leading edge solutions infuse machine learning and intelligent process automation into many of the routine numerical tasks a human bookkeeper previously had to handle manually. Key capabilities made possible by AI-assisted bookkeeping include:
Automated Data Extraction & Classification
AI bookkeeping apps can pull raw transaction information from connected bank accounts, credit cards, online marketplaces, payment processors and other sources then automatically classify them. This removes huge amounts of manual categorization effort.
Smart Transaction Coding
Beyond basic categorization, AI bookkeeping solutions use contextual understanding, past categorization patterns, optical character recognition, and other tactics to accurately code inflows and outflows with location, customer, job, department, tax, and other key details. This heightens accuracy while saving hours compared to human data entry.
Continuous Reconciliation
Bank, card, and ledger balances stay perfectly reconciled on an automated basis through AI-powered algorithms purpose built to emulate the tedious but vital reconciliation work quality bookkeepers handle manually today.
Anomaly Detection for Errors
Cutting edge AI looks across the entirety of transaction flows and balance sheets to learn the norm then actively flag outliers like duplicate payments, misclassifications, or suspicious outlays indicative of fraudulent activity or simple human error. This surfaces problems quickly before they accumulate.
Strategic Insights
Sophisticated AI bookkeeping apps go beyond backward-looking reporting to uncover forward-looking trends and growth opportunities tailored specifically to your small business. This can spotlight customer purchase patterns, personalized profitability insights, seasonal fluctuations, and other intelligence human bookkeepers rarely have bandwidth to provide.
While still an emerging technology, AI promises to drastically increase small business finance productivity and intelligence. Savvy owners should keep close watch on innovation in this area.
The Power AI Bookkeeping Offers Ambitious Leaders
After appreciating the bookkeeping basics and leading edge potential of AI automation, let’s connect all the dots on the immense possibilities this unlocks for goal-oriented small business owners.
Accelerate Growth
With reliable AI managing your daily transactions, bank reconciliations, and reporting needs as your trusted digital bookkeeper assistant you redirect hours formerly flooded with administrative finance work into priority strategic initiatives that move top and bottom line metrics. This compounds growth velocity.
Refocus on Customer Service
With your books running on autopilot, tend to the human experiences that build loyalty and spur referrals. Bring creative new offerings to market faster knowing your financial foundations have total integrity.
Embrace New Opportunities
Fresh profit possibilities surface when an AI bookkeeping solution tailored to your niche uncovers hidden demand trends and signals where to profitably stretch your small business model next.
Conquer New Milestones
Hit the next revenue, location count or customer size milestone with confidence by leveraging AI to govern scaling financial complexity as you grow without adding bookkeeping bottlenecks.
When you step back from the incremental tools and tactical workflows, AI bookkeeping ultimately enables small business leaders to stay focused on the human leadership necessary to turn entrepreneurial vision into reality at scale. That’s a competitive advantage no profitable company can afford to ignore.
Streamline Your Small Business Finances With Uplinq and Support for Hiring a Bookkeeper for a Small Business
After walking through all the intricacies of hiring, working with, and maximizing bookkeeping - what if much of that heavy lifting could happen automatically? That’s the promise of revolutionary solutions like Uplinq and hiring a bookkeeper for a small business.
Uplinq combines dedicated accounting experts with cutting-edge AI technology to deliver simplified bookkeeping and enhanced financial intelligence to ambitious small business owners.
Key benefits you unlock by making Uplinq your automated bookkeeping partner include:
Effortless Connectivity
Uplinq integrates seamlessly with your existing financial accounts and key business platforms. This enables real-time transaction tracking without manual data entry.
Continuous Reconciliation
Their proprietary AI reconciles your accounts and ledgers on an ongoing basis - identifying discrepancies immediately to maintain accuracy.
Smart Reporting
With categorization and reporting automated, your books stay perfectly up-to-date allowing you to generate key financial statements on demand.
Strategic Insights
Beyond backward-looking data, Uplinq’s algorithms surface emerging trends, growth opportunities, and other powerful intelligence no human bookkeeper could realistically provide.
Expert Guidance
While technology does the heavy lifting, you still have a dedicated accountant at the ready to advise on financial planning, tax optimization, and your most pressing questions.
Uplinq frees you from bookkeeping burdens to focus on the human leadership needed to drive your small business vision forward faster.
Experience the future of financial management by scheduling a demo today and hiring a bookkeeper for a small business.
