A professional bookkeeper can always tell who’s been doing your books.
That’s not necessarily a bad thing – it’s just that folk who are keeping their own books usually have their own style of “accounting policies” that are different to the legal set published by the governing bodies.
I’ve been in business for myself for a few years now. I’ve been into many businesses, both in my employed days and since starting up for myself.
I’ve seen many ledgers in that time – some are a work of art, some are, shall we say, less than accurate, and sadly some (a goodly proportion, if I’m honest) have been almost criminal.
I was invited into one business to be told that the bookkeeper that they’d had for years had walked out, leaving them in the lurch, so the business owner’s wife had been doing the books. She’s really too busy for that, so would I please take over the task.
They had three ABNs, and transactions that were intermingled between the three. There were many robbing Peter to pay Paul transfers, but one of the biggest issues for me was that there had not been one bank reconciliation ever done. They were operating out of multiple bank accounts, both personal and business, 3 ABNs, and not one bank reconciliation had every touched their data files.
Unconscious Incompetence. My newly-minted “business-person” heart sank. These people (lovely people, by the way) patently did not know what they did not know. Before we (inevitably) parted ways about three months later, the business owner objected to my requests for bank statements and proper procedures, told me that no-one else had ever had a problem with his books, so why should I? His mother had kept this books immaculately for years, then they got in the erstwhile Bev. Those ladies had never had an issue. He went on to inform me that the reason the “Cheque Account” in the ledger was minus $10,000 was because he’d told Bev to enter payments that had to be made. And the wife was costing Bank Account fees to Accountant.
As I left them to their fate I didn’t bother attempting to explain that bills don’t affect the Cheque Account before they’re paid, but rather Accounts Payable. He wouldn’t have wanted to know.
Not sure really why he hired a professional. Not sure whether they’re still in business either.