Our Frequently Asked Questions About Bookkeeping Services

When new businesses start, owners frequently overlook bookkeeping because they are managing various tasks or trying to manage it on their own to save money. By the time they reach out to us, there are numerous issues to address, and they don't understand why.

Here are the questions we are most often asked about clean-ups and our services. If you still have a lingering question after reading this, please contact us.

"How much are your services? Just give me a rough estimate?"

I'm not sure what bookkeeper can give a ballpark number right off the top of their head without looking at someone's books. Some do it, I just don't get it. No two client accounts are alike, even if they are in the same industry. Our rate for service is determined by an estimation process where we thoroughly go through one's books to investigate what needs to be cleaned up and what monthly maintenance will be required. It depends on the complexity of the work, the number of accounts, the type of work we are doing, whether we are tracking additional information outside of QuickBooks®, and whether our Fractional CFO Services will be included.

"What's a clean up and how much is that?"

Our first step is a cleanup, which we usually need to do for most new clients. When we checked out their QuickBooks® to give a quote, we found a bunch of mistakes, either made by the owner trying to save money doing it themselves or hiring a bookkeeper who was cheaper but not as experienced. We need to "clean it up" in other words "fix it". We quote this separately from our monthly services because it’s billed differently due to the nature of what can be discovered. Once we sort everything out, we can give a proper estimate for the monthly services. Most owners aren't aware of what needs to be fixed since they're not professionals in the bookkeeping industry. I can't tell you how many times I've heard, "Oh, it's simple. There's not much to do," only to find out it was quite the opposite. We’ll go over more details about what happens during cleanups in questions below.

"How are you different from other bookkeepers?"

1. We do not rely on rules or guessing for categorizing transactions.

2. We continually communicate with you, providing updates, reminders, and education.

3. We have fun with our clients! We aren't the stiff, boring ol' bookkeepers.

4. We look at the entire financial scene to help businesses grow which is why we offer Fractional CFO services and Efficiency Consulting.

5. We are extremely organized for a small firm and we are constantly improving to serve our clients better.

"Why do you have to clean up past transactions?"

QuickBooks® is a software that connects various parts of the program in several ways. So, if you make a change in one spot, it might affect something else, causing more mistakes. For instance, if payments aren’t applied right, we’d have to undo and redo transactions to keep records straight. If we finished reconciliations but messed up the transactions, we’d need to undo the reconciliation, fix the transactions, and then do it again. Plus, if transactions are categorized wrong, we might miss out on deductions and lose money when tax season rolls around. Also, if personal expenses get tagged as business expenses by mistake, it can lead to problems if there’s an audit.

"Why do you have to fix transfers in a clean up?"

Errors in transfers can be identified during account reconciliation. If a transfer is recorded as a "transfer" in the Bank Transaction window, we cannot simply alter it to a different account if it's not a bank account. For instance, if an owner moves funds to their personal checking, this isn't a "transfer" but rather a distribution or owner's draw and should be labeled accordingly. Sometimes, it can be classified as a To/From Owner Loan, but even this must be accurately labeled. Since it cannot be directly modified within the transaction, it must be reversed and re-entered with the correct account.

"Why do you have to fix payments made to us?"

Your A/R stands for "Accounts Receivable," referring to the funds received from someone you billed. Clean-ups become more complex when using the invoice feature, as each entry is linked to other records and reports. A single mistake can lead to additional errors that the owner might not notice because the mistake is "hidden." The three primary errors we frequently encounter are:

1. Payment to the wrong invoice: this creates inaccurate balances owed by the clients, it affects A/R reports, and leads to negative public relations with clients.

   
   

2. Failing to deposit cash when collected: this leaves transactions in the undeposited funds window, prevents proper matching of deposits, and results in incorrect reports.

   
   

3. If a client writes a check for the wrong amount and the person doesn't apply the exact check amount to the invoice: this results in inaccurate customer records, an inability to match transactions to bank downloads, and difficulty in reconciliation.

"Why do you have to fix the bills section?"

The bills you need to pay are known as A/P, which stands for Accounts Payable. This area can become disorganized if someone either fails to add a bill correctly or doesn't apply a payment properly. For instance, they might enter a check in the register instead of using the Bill Pay window, leading to inaccuracies. The owner might mistakenly believe a bill is still owed when it isn't. This can also create issues with vendors, as an error indicating they were paid when they weren't requires investigation. As a result, the A/P reports will be inaccurate. This area can be challenging to clean up, along with A/R, because it involves the owner, who may not always remember the details.

"Why do you need to reconcile each account?"

Reconciliations (comparing the bank statement to QuickBooks® records) ensure that no expenses or income are missing, that there are no duplicate or incorrect transactions, and that the register balance is accurate as of that date. This will generate accurate reports, which help in making smart business decisions and manage money wisely.

Let us know if this blog helped. If you would like a Free Consult, CONTACT US!

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#Bookkeeping #Money