Choosing the right bookkeeper

People standing in a group and smiling

A common mistake made by small business owners is to hire a bookkeeper that is not qualified to do your books. There are many individuals advertising bookkeeping services. Try going to Kijiji and search for the keyword “bookkeeping”. You will get approximately 100 results or more.

But how many of these bookkeepers are actually qualified to “do your books”?

As the owner of the company, you are the person legally responsible for the accuracy of your books. Make sure that you are doing everything you can to ensure they are accurate.

I always tell clients that there are several “general” levels or styles of bookkeepers, and there are pros and cons to each level.

The most common issue is that a store owner will hire someone to “do their books” in the interest of cost, and they do not understand that having someone to do your data entry is not good enough to ensure your books are accurate.

What is important to know about any bookkeeper is that there is no regulation on bookkeeping services. Anybody can offer them. They don’t necessarily need schooling or have to prove they are qualified in any way.

They might belong to an organization, but that does not mean they are qualified to do your books.

Many bookkeepers will specialize. Know who and what you are hiring.

Whatever style of bookkeeper you are using, you must know this:

  • As the business owner, you are responsible for all costs.
  • You cannot afford to assume anything when it comes to your books.
  • This is your company. You are legally responsible.
  • Make sure that you are doing what you need to do.

Bookkeeping is a very generalized term, and not regulated.  Your bookkeeper should have these qualities:

  • has some formal education with a recognized institution
  • should have several clients that can provide a reference
  • should be able to answer your questions intelligently, and without hesitation
  • should be able to list at least 2 accountants that they are dealing with regularly
  • should be 100% involved in their business and not treat it as a side job
  • should be able to prove that they are engaged and learning from others in the business
  • should be able to show you their working environment

There are several different styles of bookkeepers.

The Data Entry Bookkeeper

This style of bookkeeper will keep your books. They will put in what you tell them to. They will make sure that your daily paperwork is out of your way.

But what they normally don’t do is look forward into your books, be proactive.

They rely on the accountant to make the books right.

Then the small business owner takes their books at the end of the year and passes it along to the accountant. The accountant then uses the numbers and puts them into a tax return.


  • Less expensive


  • Your books may have unaudited numbers, unreconciled bank statements, or other inconsistencies
  • Could result in costly consequences if errors are performed and not caught by your accountant
  • They usually have a high level of inaccuracies
  • They rely on the business owner to make sure the books are correct
  • Tend not to have any formal education in place, but rather have learned through previous job experience


  • Tend to be home based

The Professional Bookkeeper

This bookkeeper has years of experience. They know debits and credits like they know their own kids. They are able to pick out areas of concern in your business, and give that information back to you.

A good bookkeeper in this category will get to know your business, and will be intuitive enough that they will ask questions about what you are doing. They will want to know your personal income so that they can maximize your tax returns personally and professionally.

This type bookkeeper will be competent to do your payroll, T4, and GST returns.

They will use or have their own version of accounting software.

Experience in this field is quite diverse, however, leaving it difficult for you as a store owner to know if you are getting bang for your buck.


  • Higher confidence level that your books are being done accurately
  • Mistakes are usually minimized
  • Relies on the bookkeeper to be accurate rather than the business owner
  • Minimizes the costly consequences of errors
  • Usually has education or belongs to an association


  • The level of experience will vary
  • May be slightly more expensive, depending on the detail level


  • Tend to have a dedicated office (which may be a dedicated space from their house)

Your accountant:

Your relationship with your accountant is important. How much your accountant is actually doing for you will have a wide range of services, and a wide range of costs.

There are 3 general levels of engagement with an accountant. Know which one you are paying for. They are:

1. Notice to Reader
2. Review
3. Audit

The general rule of thumb that a client can use is looking at the cost. A tax return for a corporation will start around $1500 – $2500 per year. This generally includes the corporate return plus answering any questions you may have about your tax accounting.

It generally is not auditing your numbers, nor does it ensure that you have not made any mistakes in your daily operational bookkeeping.** The more you pay, the more services you are receiving.

To get an understanding of the type of service you are getting, you should always ask your accountant these questions:

  1. What type of tax return am I getting? What services are you providing me?
  2. Are you doing any tax planning on my behalf? Know what planning is doing before Dec 31 and after Jan 1. They are often different types of tax planning involved.
  3. If my bookkeeper made an huge error, would you catch it?
  4. Do you make sure that the bank statements and credit card statements are reconciled properly?
  5. Are all my assets on the books correctly? How do they know?
  6. Are you adjusting my inventory, or making sure that my inventory is being adjusted yearly (for retail inventories)?
  7. How confident are you that the numbers that I have given you are correct?
  8. Do you check to make sure my books match the government records CRA (Canada Revenue Agency)?
  9. For payroll, are you filing my T4? Are you filing my ROE?
  10. For GST, are you filing my GST? Are you adjusting my GST for bad debt? Are you making sure that I am claiming all the GST applicable to me?
  11. Does your accountant have an RC59 filed with Revenue Canada to be able to access your records on your behalf?
  12. Are you looking for discrepancies in my books?

If your accountant is not doing any of these items, then you need to make sure that your bookkeeper is doing them.

Many times, business owners assume their accountant is doing this. The accountant will often assume the business owner has done what they need to do and the numbers are right.

This article has been provided and written by On-Core Services, and is meant to provide general information only. It is not meant to replace any advice provided to you by your currently accountant, nor should it be used for any financial purposes.