Is your bookkeeper stealing from you? Do you have doubts?
If you are still reading, maybe you are just curious. Or maybe...
All too often, I hear the story of a business whose bookkeeper swindled it out of a lot of money.
My first thoughts are usually: How? And why?
Here is my advice on how to make sure your bookkeeper is not stealing from you.
Take some time interviewing potential candidates for your bookkeeping position.
Check their references to see what type of person they are, professionally and personally. I would also suggest doing a background check on them. They will work with sensitive financial information, so you want an honest professional.
Make sure there are checks and balances in place.
A bookkeeper should not be able to sign checks, make bank withdrawals, use bill pay, or do other activities. As a business owner, those managerial tasks should not be delegated.
Have your financial tasks spread across at least two parties, yourself included. Do not let a bookkeeper enter bills and then cut and sign checks.
Those are poor bookkeeping procedures and they leave your business vulnerable to theft.
If your bookkeeper is "in on the action," they will be less likely to steal from you.
If you are happy with your bookkeeper, offer them some sort of profit share or bonus incentive.
Even if it's low, something is better than nothing. This way, they will be working with you to make your company as profitable as possible.
I call this one the old flipperoo; turn the tables on your bookkeeper and audit them.
This can be very subtle and can be as easy as constantly staying involved. Asking to see copies of invoices and receipts shows you are involved and "watching" the books.
Randomly ask your bookkeeper to bring you all petty cash receipts and make sure they can explain all of them.
By staying involved with the day-to-day bookkeeping activities, your bookkeeper is less likely to even think of trying to steal from you.
It seems that a bookkeeper would only steal from an employer if the employee feels left out or unfairly compensated. By involving your bookkeeper in the business, you may reduce their desire to steal from you.
Also, the only way to make sure that your bookkeeper is not stealing from you is to have the right bookkeeping procedures in place with proper checks and balances.
By staying involved in the day-to-day bookkeeping, you will demonstrate that it may be difficult to sneak something by you.
Has anyone stolen from you? Want to talk about better bookkeeping procedures?