Why You Keep Hiring the Wrong Bookkeeper (And What You're Getting Wrong)
On your fourth, fifth, or sixth bookkeeper and still frustrated? The problem might not be the bookkeeper. Will, Alex, and Ian break down what a bookkeeper should and shouldn't do, what they need from you, and what it costs when nobody really understands the books.
The Short Answer
Most bookkeeper relationships fall apart over expectations, not skill. Owners often hire a bookkeeper for a few hundred dollars a month and expect a CFO: someone who forecasts, gives advice, and somehow knows about the truck you bought last week. A bookkeeper records, categorizes, and reconciles what already happened. For that to work, you have to do your part too: keep personal spending out of the business, answer their questions every week, tell them when things change, tell them how you want the books laid out, and review the numbers with them every month.
What a Bookkeeper Does, and What They Don't
A lot of frustration comes from hiring a bookkeeper for one job and expecting another. Here is the line we draw for the owners we work with.
A bookkeeper should
- Record and categorize every transaction
- Reconcile your bank and credit card accounts to the statements
- Close the books each month, usually by the 10th to 15th
- Send you a profit and loss statement and balance sheet
- Ask you about anything they can't categorize
A bookkeeper usually doesn't
- Build forecasts, budgets, or projections
- Tell you how the business is performing or what to change
- Decide what to do with your cash
- Give tax advice on what you can run through the business
- Move money or pay bills, unless you've hired a full-service team
Some bookkeeping firms offer full-service packages that also run payroll, pay your bills, and collect from customers. That's real operational work, closer to a part-time or full-time role, and it costs more than basic bookkeeping. Know which one you're buying.
Bookkeeper vs. Controller vs. CFO
Many owners hire a bookkeeper while picturing a controller, someone inside the business watching every dollar come in and go out. Those are very different jobs at very different prices.
| Role | What they do | Typical cost |
|---|---|---|
| Bookkeeper | Records and reconciles what already happened, and closes the books each month | About $300 to $1,500 a month |
| Controller | Oversees accounting day to day, often full time, and manages the close and the people doing it | About $50,000 to $100,000+ a year |
| Fractional CFO | Looks forward: cash forecasts, margins, pricing, budgets, and big decisions | About $3,000 to $7,000 a month |
Ranges are typical for owner-led businesses and vary with size and scope. For more, see fractional CFO vs. bookkeeper vs. CPA.
What Your Bookkeeper Needs From You
Alex has hired plenty of bookkeepers over the years, kept some for seven to nine years, and moved through others quickly. Looking back, he sees five things that were his job as the owner, not theirs.
1. Keep personal spending out of the business
A pile of mixed personal and business purchases makes categorizing a guessing game. Ask your tax professional what can legally go through the business, run those things through, and keep everything else personal. Your bookkeeper shouldn't have to act as your tax advisor.
2. Answer their questions every week
When a bookkeeper can't tell what a charge was, it lands in an "ask my accountant" bucket. Wait until the end of the quarter and you won't remember either, so it gets dropped somewhere random and throws off your profit. Clear it weekly. It takes five minutes, and it's also one of your best defenses against fraud.
3. Tell them when something changes
New vehicle, new loan, new credit card, new bank account. Your bookkeeper isn't watching your inbox. Missing loans, assets, and accounts on a balance sheet are often a communication problem, not bad bookkeeping.
4. Tell them how you want the books to look
Most bookkeeping firms start every client from the same template, and that template is usually built for taxes, not for running your business. If you want income split by service line or certain costs in cost of goods sold, say so. You're allowed to ask for that.
5. Review, respond, revise every month
Review the books, tell your bookkeeper what needs to change, and let them revise it. Even great bookkeepers rarely get it 100% right on their own, and that's normal. Once things are set up, this takes about 15 minutes a week, and a thorough monthly review takes about an hour.
"We cannot delegate the understanding of the numbers to someone, or else we're going to delegate the success of our business to someone else."
Alex Engar, co-founder of CEO Finance AcademyWhat to Expect From a Good Bookkeeper
- Books closed by about the 10th to 15th of the next month. That's normal, not a month behind. It takes that long for statements to come in.
- View-only access to your bank and credit card accounts. They should be able to pull statements themselves, but they shouldn't be able to move money, and a good bookkeeper won't want that liability.
- Questions, especially at the start. A new bookkeeper has to stand behind the whole year's books, so expect them to review or redo the months before they started, and expect to pay for that catch-up work. It should take weeks, not six months.
- Clear communication. If the books will be late, they tell you why. When you ask for a change, it doesn't take two months.
- A monthly review with someone. Whether it's your bookkeeper, a controller, or a fractional CFO, someone should sit down with you at least once a month and walk through the numbers. If nobody does, start there.
Why Cheap Bookkeeping Can Cost More
Do the math on a $200-a-month bookkeeper. To make a living at that price, they need a lot of clients, which means very little time for any one of them. That's why so few bookkeepers ever offer a weekly 30-minute call to learn your business, even though that's the thing that would keep most owners around for years. AI is making the data entry faster and cheaper, but the conversations are where mistakes get caught, like the vehicle purchase nobody mentioned.
The same goes for having your tax accountant's office do your bookkeeping. It can work, but in our experience those relationships often don't last, because tax prep and monthly bookkeeping are different kinds of work with different rhythms.
What It Costs When Nobody Understands the Books
Most tax preparers check a few numbers against your bank statements, ask a couple of questions, and file based on what you give them. If the books look reasonable but are wrong, they have no way to know, and you're the one responsible for the return either way.
About $22,000 in overpaid taxes
Early in business, Alex set up a new company structure but didn't understand how money should flow between the entities. His tax preparer counted the same income twice, and he didn't catch it for about two years.
About $70,000 coming back
After cleaning up years of misreported books, one of our clients recently found they had about $70,000 coming back through amended returns.
Decisions made blind
Sometimes the cost is the opposite: the business is doing better than you know, and you hold off on the hire, the equipment, or the new territory you could have afforded.
Want Books You Can Actually Make Decisions From?
We handle bookkeeping and review your numbers with you every month, so you always know where the business stands and what to do next. Let's take a look at where yours are today.
Book a Free Intro Call See our bookkeeping servicesFrequently Asked Questions
A good bookkeeper records and categorizes every transaction, reconciles your bank and credit card accounts, closes the books by about the 10th to 15th of the next month, sends you a profit and loss statement and balance sheet, asks about anything unclear, and tells you when something will be late.
Forecasts, budgets, projections, deciding what to do with your cash, telling you what to change in the business, and tax planning are usually outside a bookkeeper's scope. That forward-looking work belongs to a controller, a fractional CFO, or you as the owner.
Outsourced bookkeeping for a small business typically runs about $300 to $1,500 a month depending on transaction volume and services. Full-service packages that also handle payroll, bill pay, and collections cost more. A full-time controller usually costs $50,000 to $100,000 or more a year.
Usually because expectations were never set on either side. Owners often expect a bookkeeper to act like a CFO, and bookkeepers often wait to be told what the owner wants. Before hiring the next one, write down exactly what you need, what you will do on your end, and how often you will review the books together.
Yes, but view-only access. Your bookkeeper should be able to download statements for your bank and credit card accounts without you sending PDFs, but they should not be able to move money. Most good bookkeepers do not want that liability.
A few weeks for most small businesses, not six months. A new bookkeeper has to review or redo the months of the current year before they started because they are signing off on the whole year, so expect some catch-up cost and a lot of questions at the start.