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Bookkeeping
Hello O&P,
During our O&P cohort’s “Financials” module my bookkeeper decided his company couldn’t provide us with the service we are looking for. I was a bit shocked since I didn’t think I was asking too much. That’s another story.
So I’m in the market for a new bookkeeper, we need a full cycle bookkeeper and I need some help:
1. Do you use a 3rd party bookkeeping business? Or do you use an in-house part-time bookkeeper? Have you ever used an in-house VA specializing in bookkeeping?
2. How much do you pay $/month for your bookkeeping services? What’s a reasonable amount to pay for timely bookkeeping (ie. you have last month’s numbers by the 15th of this month)?
Let me know!
~James
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6 Replies
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James, you are entering into challenging territory. Using your hiring model we discussed in class consider creating a position agreement so there is absolute clarity of what you want this bookkeeper to do. I would encourage you to interview at least 3-5 candidates before deciding and check references. I can not believe how many clients have been burned (BADLY) by bad bookkeeping.
Average pay is between $30 and $50 per hour. If you want to explore outsourcing to UpWork or other local agency be sure to test the knowledge of Canadian laws and taxes. I would also ask for and confirm certification on your bookkeeping program.
Another thing to discuss is your policy around Journal entries and uncategorized income and uncategorized expenses. Create a communication system with your bookkeeper to ensure she/he knows what all items are soon enough that you don’t have to go back months and try to remember.
Does this help? As others join the community I’m sure we’ll get some addition insight into this topic, thank you so much for stepping forward and asking!
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Hello Beverlee,
Thanks for your feedback. An update: after searching I decided to try to clarify my expectations with my current bookkeeper by creating a Bookkeeping Services Agreement. Here’s what it looks like:
Precision Tree Services Ltd
Accounting Department Task List
Current Challenges:
- Development and implementation of a per job/contract costing system
- Jobber? No.
- QBO? No.
- Internal custom designed app
- Look to streamline the system, remove inefficiencies and redundancy
- Can Jobber time tracking replace TSheets? No. Use TSheets API for time tracking in internal Precision App.
- Is Hubdoc needed? Yes.
- Does QBO work better for us than QB Desktop would? Yes. Remote access to financials. Current custom reporting.
Weekly Responsibilities
- Post payables to QBO from Hubdoc
- Create (raise) sales invoices to BC Hydro via Ariba Network as they occur
- Check that Jobber has synced with QBO successfully and make changes as necessary
- Generate and send AP, AR, and Credit Card Balances reports to James and PTS Executive Assistant (Lindsey) every Thursday
- Phone and email support as needed
Bi-Weekly Responsibilities
- Add new employees from completed TD1 forms and Direct Deposit authorization forms
- Run payroll
- James to review and approve time in TSheets (or Jobber) every other Monday
- Post time and run payroll
- Forward manual cheques info to PTS Executive Assistant (Lindsey) for payment
- Crate paystubs and upload to Dropbox (folder for each employee?)
- LifeBiz Customer Experience Manager Lindsey’s LBE hours (cost) moved to LBE – currently paid by Precision
- Prepare any ROE’s
Monthly
- Reconcile all bank and credit card accounts; to be completed by the 15th day of the following month
- Ensure the “Due To/From Life Biz” ledger is balanced with its counterpart in the Life Biz Books
- Transfer for “Precision Savings Plan” = 15% of all Revenues transferred from PTS chequing to PTS savings each month
- Remit and pay source deductions
- Remit corporate tax installment payments
- Post any accruals as required
- Review Loan balances and their terms
- Monthly meeting to review systems, policies, procedures and target improvements
- Issues, improvements, performance
Quarterly
- WorkSafeBC reporting and remittance
- GST preparation and remittance
Annually
- T4 and T4A’s for all employees and contractors
- Year-end for the company completed by November 30th annually
- Respond to questions from the YE CPA
Notes
- Please ensure all correspondence addressed to precisiontreeservicesltd@gmail.com
- No payments or movement of monies in and out of any precision bank and credit card account will be performed without written permission from a signing authority on the account
- Monthly meeting, if necessary. An agenda will be created sent ahead of meeting for review. The Agenda will always start with a review of the Balance Sheet and P&L and bank reconciliation reports.
I have also been extremely diligent in limiting the communication with the bookkeeper. I had been engaging them for financial planning and strategy but have stopped using them for this service. I know consult my accountant on things like my “Precision Profit Sharing Plan.”
Hope this helps anyone else with bookkeeping issues.
~James
- Development and implementation of a per job/contract costing system
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I like how you have taken your power back in the area of “financial planning and strategy”. Often small business owners abdicate responsibility to their bookkeepers (and/or accountants) who end up making decisions that are not always in their clients best interest. The way a typical chart of accounts is set up is one example of this that I see all the time. It is designed to give data to the tax department, not to provide accurate income/expense data to the small business owner.
Great job James, The lesson here…. know how money flows in and out of your company, track it accurately, look at the numbers in a way that makes sense to you. Know what you want and have a system in place to hold people accountable to give it to you.
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An update: after searching around locally and worldwide on Upwork I’ve decided to try something… different. I think the main choke point for information flow in any bookkeeping system is… the bookkeeper him/herself. They have different schedules and clients and data entry on a consistent basis seems to be a tough challenge. So, is bookkeeping without a bookkeeper possible?
Believe it or not, the answer might be “yes.” I’ve engaged a company out of Boston, MA, called “Botkeeper” (www.botkeeper.com) to help me out with my bookkeeping. They offer Artificial Intelligence and machine learning to facilitate quick data entry. They offer human support in the form of a team of accountants who are assigned to your company and get to know your work flows.
Botkeeper offers very competitive price points for various service levels, which are dependent on the number of transactions you run monthly. They actually offer FREE bookkeeping for the lowest transaction levels to help companies in the start-up phase. I dig that.
I’m in the process of onboarding right now. It looks like right off the bat I can stop using Hubdoc which is about $60US/month. I still take pictures of POS receipts but instead of using the Hubdoc app I send them to my “Bot” via attachment with e-mail. I actually like this system better because it gives me a paper trail to find anything I’ve sent in (searching my e-mail “sent” folder) – Hubdoc’s app doesn’t let me search anything. Also, I am now coding everything myself using our Chart of Accounts coding sheet so I enter the class and code in the subject line of the e-mail which is super easy. An additional plus is that all invoices I get via e-mail can be forwarded to my “Bot” as well, which is basically identical to how Hubdoc works.
I’ll keep you in the loop with how Botkeeper goes, we’ve got a progress update meeting next week. There have been some small growing pains – ie. pay stubs not getting sent to employees. I also had to keep my Canadian bookkeeper on for small Canadian-specific tasks such as tax remittance, ROEs, etc. The quoted cost for this services monthly (billed hourly) is about 1 hour which is about $50.
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Update: It looks like Botkeeper isn’t ready to automate Canadian payroll (or businesses). There have been a number of drawbacks, particularly around payroll. And when payroll isn’t done right, ain’t nobody happy.
Revised plan: My wife has started taking a bookkeeping course at North Island College in Courtenay. She’ll be taking over our books in March. Initially, we resisted this course of action because we didn’t want “all our eggs in one basket” thinking she’d be better off getting another job in a different field, unrelated to Precision Tree. There are some reasons we decided to have her start helping:
1. As the bookkeeper, she’ll have a first-hand look at the flows in and out of the company and can weigh in on spending/decisions from an informed standpoint.
2. I won’t have to do all this alone and will have a partner to help me.
3. Precision gets a specialized, dedicated, bookkeeper capable of keeping our books up-to-date weekly – this is worth paying more for.
4. We can use this to income split legally so we earn more money personally.
I’m also getting my part-time admin assistant to help more on Precision Tree (instead of our other company Lil Worker Safety Gear). We revised our website so all residential contacts flow through her, she schedules my estimates and takes care of customer follow up. My aim is eventually to have my assistant scheduling estimates with an estimator who is NOT me, leaving me to schedule crews. Maybe we’ll even have enough work to justify a dedicated residential crew which she could then schedule for me, taking me right out of the system. I’m sure Beverlee loves hearing that.
The assistant also has payroll experience so we’re training her to take over payroll from Botkeeper using Quickbooks online and Wagepoint. She’ll be able to train my wife to cover for her so we make sure someone is always available to do payroll.
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How’s the bookkeeping going? Lots of turmoil on the streets with many small business owners struggling to pull this vital activity together. (especially at this time of year with T4’s , T5’s etc)
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