3 Signs your bookkeeper is no longer enough

3 Signs your bookkeeper is no longer enough

I often get told by business owners, “I don’t know what I don’t know” because they don’t really understand what they should be expecting or getting from their bookkeeper.

It’s true, you get what you pay for. Don’t expect a full detailed costs analysis, ad hoc information just when you need it and constant telephone discussions, if you have only paid for the bare minimal service. That is being unrealistic!

So what have you paid for?  If you don’t know what a standard bookkeeper rate should be, simply tap bookkeeping jobs into google and the hourly rate will be quite visible.

If you do value your financial information and you have negotiated a package to cover the management reporting, here are 3 signs that you may not be getting what you are paying for:


1. You get sent your monthly management reports, but there are no key headlines… and you actually don’t understand them.

The monthly management information that you receive, should always be accompanied by a dialogue, preferably in person, to explain what the key headlines are.  The report only provides the figures. This needs to be accompanied with the ‘story’ of what has happened in the month.  If all is fine, then that should be made clear to you and the reasons why the accounts are fine. E.g. your gross margin is in line with your past performance so far, your costs are up but you have incurred some essential costs which will generate a return by the end of the year.

If you are not getting the accompanying dialogue with your reports, then there is a good chance you are just being sent the standard reports from the accounting system. The dialogue you have, should be simple and easy to understand. You need to have the opportunity to ask questions. You need  to be able to relate the figures to what you have seen happen in the month.You should  feel happy that the accounting information is a true reflection of the business activities in the month.

The skill in management reporting is not just in the production of the reports. It is the explanation of the figures and making sense of what they are saying in a simple, clear way that will give you the insight you need. If you are not finding it easy to understand the figures then they are not being made clear to you. You need to have them presented in a way that best suits you as the business owner and the customer. Do the explanations that you are given make sense to you? Do they stack up with what your business intuition is telling you?

2. They always tell you when you can’t spend, never when you can!

If your bookkeeper is telling you to stop spending, this will be because they are measuring your performance by looking at your bank account in a reactive way. Correct management reporting ensures that you have an up-to-date and accurate cash flow forecast, which will help you to negotiate the natural peaks and troughs which occur in your business. Your cash flow should be managed on a weekly or monthly basis depending on what limits you are trying to operate within. There should be clear guidelines given to you on how much you CAN spend during a time period. This a much more proactive approach. It is important that you have the opportunity to have a two way dialogue between the both of you, whether via email or on the phone. There should be an ongoing information flow between you both on what you are planning to spend, how sales are expected to change and the other variables in your business. The cash flow forecast will be a powerful tool to enable you to grow or progress your business without having to constantly worry about your spend decisions.

3. They are too slow to respond

So what’s too slow? Well, if you don’t have the information available to you, when you need to take the decision, then it’s too slow.

With management reporting, the production of the monthly figures on a regular and consistent basis, results in the build-up of a powerful database of financial information. This can be accessed at any time. This information provides the data you need to make your day to day decisions. This in turn should enable you to make quicker and more confident decisions for running your business. E.g. monthly payroll figures will help you with efficiency measures and KPI’s. Sales figures will show monthly and seasonal trends and can be used to project forward. Customer and supplier payments will indicate where you have problems in your cash cycle.

Accounting software will gather data for you and can provide quick and easy reports which can then be downloaded and reformatted in excel. This gives you the information that is right for your particular query. Therefore, the retrieval of information should become increasingly easier as you build up the database. Responsiveness to small companies is important, having to wait too long to have the data to make a decision, can make the difference between missing an opportunity and harming your business. Knowing where to draw the information from is the key and a good bookkeeper will feel confident on where to look and furthermore they will know how to reformat the figures in a quick and efficient manner.

If you are still unsure, ask yourself “what you could do if you had this information?”

Not knowing is probably one of the biggest reasons why businesses fail, especially in terms of financial information.

If you still “don’t know what you don’t know” please give me a call for a friendly, no obligation chat. I am happen to discuss your management information needs and how this can be found from inside your business.


An fascinating dialogue is value comment. I believe that it is best to write more on this matter, it might not be a taboo topic but generally individuals are not sufficient to talk on such topics. To the next. Cheers fdebefbfefdg

Leave a Comment

Comment (required)

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Name (required)
Email (required)