How to Keep Your Accounting in Check

The accounting profession has changed drastically in the last five years and cloud-based solutions such as Xero, SageOne and FreshBooks have emerged, allowing accounting professionals and their clients a real-time view into their financials.

If you were to ask entrepreneurs what their favorite part about their job is, odds are, doing taxes is at or near the bottom of the list. Despite this, keeping good financials is paramount to run an effective business. And fortunately for entrepreneurs, accounting is becoming more streamlined and easier than ever.

Additionally, the cloud has enabled many financial systems such as payroll and time tracking to be automated and integrated into accounting platforms, making number crunching not so daunting. These innovations combined have enabled accountants to do what they do best -- provide up-to-date financial counsel to their clients so they can focus more on growing their business.
While these developments are a benefit to small businesses and accountants, there are still preparatory tactics SMBs can employ to make the best use of these tools and benefit their bottom line.

Here are a few tips and best practices to help small business owners keep their visionary outlook, while enabling their accounting partners to serve them with the most accurate financial counsel.

Spread out tax payments. If you have trouble saving for your quarterly estimated tax payments, set aside funds each month instead. Treat it like any other monthly operating expense, that way it won’t seem like such a chunk when payment comes due.

Back to the future. It’s good practice to live in the “now,” but in business, as well as in life, you should be thinking about and planning for, the future. As a business owner if you’re not looking three to five years into the future, you are behind the competition.

It’s not personal, it’s business. Have a dedicated business checking account and business credit card. If your business checking is low on funds, it's easier to account for making a loan to your business than it is to account for business expenses paid from a personal account.

Monitor and measure. Look at your company's financial performance regularly and use backwards-looking financial statements to project forward revenue, expenses and cash flow. You can't manage what you don't measure. Having this knowledge will help you make better decisions.

The time is now! If you have dragged your feet about hiring an accountant or bookkeeper for your business get one today.  Not just because it makes good financial sense to have an accountant lined up before the tax crunch, but also because accountants rosters fill up the closer it gets to tax time, making it hard to take on new clients. If they do take you on, chances are it will be at a much higher rate than if you'd started working with them earlier.

Share your opinions in comments!

Ref: entrepreneur.com/article/231409#ixzz2tebf3H5

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Computerizing Your Accounting System

One of the most important tasks facing a small business is keeping watch over the money flowing into its coffers and out to its vendors, employees and advisors. Fortunately, today's full-featured-yet inexpensive-accounting programs allow business owners to track and manage every aspect their companies' finances. And by automating income and expense information, a business can reduce its accounting expenses and save its accounting firm time and effort.

"The key to managing a business is knowing how it's doing by keeping accurate income and expenses records," says Eugene A. Schnyder, a CPA and emerging enterprise consultant in Shushan, New York. Even a moderately successful emerging business, however, soon outgrows cash-drawer/checkbook recordkeeping. The cash balance at the end of the day doesn't tell how well a business is doing, nor does it help in making business decisions. In the past, accounting records were maintained by hand, in columnar ledgers, which involved tallying transaction totals at the end of each week or month. A computerized accounting system can track and analyze considerably more information than a manual record system-and with less effort.

John Eason owns and operates Southeastern Sales & Specialties Inc. and Advanced Distribution Technologies Inc., software development and distribution companies in Carrollton, Georgia. "A typical start-up company tends to rely on its owner's ability to 'keep the figures' in his or her head," Eason says. "As the company grows, the owner's time is diverted from his or her area of expertise and to the areas he or she is usually less capable or experienced in-accounting, collections, determining costs and so on. The single most important factor for most businesses is cash flow and the ability to manage it properly.
Most small-business owners don't know their true costs of doing business because they don't accurately track or monitor all the costs. They tend to discount their time and profits because of this. Small companies do the same things and need the same information as large companies. Selecting the proper accounting software can save most of the accounting costs incurred by a company and will give its banker confidence in the company's ability to provide proper, timely and accurate financial information."

LEARNING THE TERMS
To choose the right accounting software for your business, you should understand these basic accounting terms:
Asset-A tangible or intangible object of value to its owner.
Liability-An obligation to another party.
Income-Money received for goods or services produced or as a return on investment.
Expense-Money spent for goods or services.
General Ledger-The main records of the assets, liabilities, income and expenses of an organization.
Accounts Payable-A company liability; amounts due to suppliers of goods or services.
Accounts Receivable-A company asset; amounts owed for goods or services that have been supplied.
Capital-The net worth of the company; the assets less the liabilities.
Double-entry accounting-A system in which the total of all left-side entries is offset by an equal total of right-side entries. Left-side entries are known as debits, and right-side entries are known as credits. A debit or a credit can be applied to any general ledger account, whether it's an asset, a liability, capital, income or an expense.

FINDING THE SOFTWARE THAT FITS YOUR NEEDS
The best way to select an accounting program is to match your company's needs against popular accounting programs. A typical program will contain modules, or sections of a program, that cover particular accounts, such as accounts payable, accounts receivable, invoicing, inventory, payroll, banking and so on. The best software includes modules you can use to track your contacts and your schedule, to maintain a list of tasks and reminders and to perform mail-merges for form letters and labels.

Schnyder offers the following suggestions for choosing a suitable accounting software program:
Purchase an off-the-shelf commercial or shareware package rather than a custom program, because most of the bugs have already been removed. Most off-the-shelf programs also provide a good user's manual, a strong help system and support services.
Get a recommendation from your CPA. Also check with members of local business organizations and other small-business owners.

Look for software that's easy to set up. Some programs ask questions about your business and use the answers to create the first records and to enable features suitable for your business. A program should be easy to customize so you can select features appropriate for your business and remove features you don't need.

Consider software created specifically for your type of business. If you run a pet store, for example, look for a program that provides features for retailers or even specifically for pet stores. Shareware is the best source for business-specific accounting programs. For names and addresses of Web sites from which you can download share-ware programs, see the June 1997 "Computer Ease" column.
Schnyder also recommends asking yourself the following questions:
Does the software provide all the functions you need? For example, if your company maintains an inventory of supplies or goods produced, the program should include an adequate inventory-management system.

What monthly reports and journals does the program produce? Can you customize them for your business? Can you create new reports without too much effort?
As your business grows, can you easily move from your current software to a more advanced version?
You don't want to have to enter data more than once, so your accounting program should be able to share data with other programs on your computer. For example, look for a program that can import data from and export data to your spreadsheet program. Or if you want to insert financial reports into documents such as proposals or business plans, make sure your accounting program can export data to your word processor.
Can the accounts receivable, accounts payable, payroll, inventory and other modules communicate with each other and easily pass information back and forth?

"Accounting software should be completely integrated," Eason says. "Too many companies purchase an accounting package and try to 'marry it' to another program to make it complete. An accounting program should be true double-entry, interfaced with other modules (such as inventory, purchasing, sales order/invoicing and so on). A business needs to be able to keep track of all the operations it uses to perform its work as the work is being performed. I searched for an accounting package that contained most of the features and capabilities of the accounting systems I used when I worked for large companies."

USING THE INTERNET TO SEND AND RECEIVE FINANCIAL DATA

More and more clients and accountants send and receive data using the Web. Some accounting programs provide built-in Internet access, and accounting firms use client write-up programs to send and receive financial information to and from clients, banks and government agencies. "I believe the Internet and programs that utilize the latest technology are going to dramatically change the way accountants deliver service to small businesses," says Myron Joy, a CPA who operates Joy & Associates CPAs, PC, in Phoenix. "Using Internet connections, businesses will send financial information from their accounting programs to their accountants' offices for completion of traditional accounting functions. Then the accountants will arrange tax deposits and payments and download bank account information-all online. The completed financial reports and accounting data will be sent to the client via the Internet to his Web site or e-mail address. The efficiency of this type of delivery system will lower the clients' overall costs. Joy & Associates has developed ClientLink Write-Up, a program that gives the accountant the features to implement such a service." Other developers of write-up programs for accountants include Creative Solutions (http://www.csisolutions.com/),
Drake Software (http://www.drake-software.com)
UniLink (http://www.unilink-inc.com/).

BENEFITS OF A COMPUTERIZED ACCOUNTING SYSTEM
Computerized accounting systems are well worth the investment. Schnyder sums it up: "The initial entry of records into a computer accounting system is just as time-consuming as it is in a manual system. A byproduct of computer record-keeping, however, is the capability for analysis, accuracy and quick retrieval of searched-for records."
Contact Sources
Advanced Distribution Technologies Inc.,
http://www.the-information-age.com/business/adt
Joy & Associates CPAs PC, (602) 468-1284, http://www.joycpa.com/
Southeastern Sales & Specialties Inc.,
http://www.the-information-age.com/business/sss

Ref : http://www.entrepreneur.com/article/23098

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You Should Review Your Accountant !

Is your accountant helping your business or upping your tax bill? Take a close look.
With the tax-filing season in full swing, it makes sense to take a good, hard look at your accountant and the work he or she has done for you over the past year. Is your accountant helping you save money? Is your business better off as a result of your accountant's recommendations? Don't let an old, familiar relationship lull you into a false sense of security.

Scrutinize all the services your accountant provides. Are you getting your money's worth? Perhaps your company has grown significantly from its start-up days and you now need a larger accounting firm that can provide more services than a one-or two-person shop.

When you're first starting a business, you typically need financial guidance with your daily operations. Once established, however, a business needs a tax professional who can perform a wider range of services, such as offering assistance in locating financing or upgrading your software programs.

To determine how your accountant stacks up, ask yourself these questions:

1. Can you easily reach your accountant when you need to speak with him or her?
You should get quick responses to your calls, says Paul Thrasher, a CPA with the Alexandria, Virginia, accounting firm Halt, Thrasher & Buzas. If you have to wait several days to speak with your accountant, he or she is in danger of getting a failing grade.

2. Has your accountant given you guidance on which tax records to keep and how to organize them?
Accountants with their clients' best interests in mind take the time to provide effective ways to organize your business records. In some cases, he or she may ask you to save tax-related information on a computer disk; that information can be downloaded into the accountant's tax return software. Maintaining organized tax records also means you'll save money you would have had to pay your accountant for organizing the confusion.
"A good tax professional should be able to [tell you] how you can automate your record-keeping so you can very seamlessly get your records into his or her system," says Susan Jacksack, a small-business analyst with CCH Inc., a provider of legal, tax and business information in Riverwoods, Illinois.

3. Are you satisfied with your accountant's ability to stay up-to-date on tax changes?
You want to be sure your tax professional has a thorough understanding of all the latest tax law changes and their impact on your business. If your accountant provides you with a newsletter and offers periodic seminars on tax law changes, this is a good indication he or she is on top of things, says Thrasher.

4. Is your accountant doing everything possible within the law to lower your tax bill and offer you money-saving tax strategies?
A good accountant continually volunteers possible strategies, especially with all the changes taking effect as a result of the Taxpayer Relief Act of 1997. "You shouldn't have to pull possible strategies out of him," says Jacksack.
For example, under the new law, there are a lot of tax breaks that depend on your income level and involve some shifting of income from one year to the next so you're eligible to take certain deductions. Your accountant should be offering you advice right now on how to take advantage of these tax breaks.

5. When your accountant offers advice and tax strategies, do you feel comfortable with them?
Your accountant's philosophy should match your own. For example, is he or she always suggesting aggressive strategies to minimize the tax burden, even if it means being peppered with questions from the IRS? Conversely, you may feel your accountant is not aggressive enough and is ignoring deductions you may be able to take. If you find you're knocking heads too often, your accountant is failing the test.

6. Have you requested the results of your accounting firm's peer review report, which is supposed to be done every three years by an outside accounting firm?
When firms are willing to share the results of this audit with you, they usually don't have anything to hide, says Thrasher. On the other hand, he adds, "a lot of hemming and hawing may indicate a problem."

7. If you use a large accounting firm, do you know where it ranks on the local business journal's most recent list of the top 100 accounting firms in your area?
While these rankings are done according to the size of the firm, if yours is on the list, it indicates you are dealing with a quality firm, says Thrasher.

8. Do you feel the accounting fees you pay are what they should be?
Take a close look at what you're paying for accounting services and whether you're getting your money's worth. Of particular concern are accounting fees that go up every year, without fail. If this is happening to you, ask yourself whether the additional fees you pay every year are worth it.

9. Does your accounting firm assign you a new staff accountant fairly frequently?
If that's the case, watch out. This kind of revolving door means trouble for your business because it takes a fair amount of time to get a new CPA acclimated to the way you do things. In addition, it may mean your accounting firm is not being managed properly.

10. Is your accountant familiar enough with your type and size of business?
Your accountant should be working with a fair percentage of businesses the same size as yours, says Jacksack. "The more clients they have like yours, the more helpful they'll be to you because they can tell you how your business is doing vis-a-vis the other ones they deal with," she says.

While industry knowledge is important, don't make more of it than is necessary, advises Thrasher. Raw ability often outweighs factors such as knowing a specific industry, he says. There are exceptions, however. Thrasher points out that if your business involves government contracting, you need an accountant who knows those particular accounting requirements. In addition, Jacksack notes that retailers need accountants who are familiar with the tax rules and requirements concerning inventory.

If, after answering these questions, you decide your accountant doesn't measure up, discuss your concerns with him or her. Give your accountant some time to work on areas that need improvement and keep the lines of communication open. In today's highly competitive marketplace, accounting firms, like most businesses, are making every effort to keep clients. Let this work to your advantage and make sure you get the most for your money.

Ref: http://www.entrepreneur.com/article/15448#ixzz2gAOv3O6t

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Add an Accountant to Your Business

If you think you only need an accountant during tax time, you may want to think again. Good business accounting is not just about balance sheets and tax returns. With the help of a competent accountant, you can track your business's finances and make sure it's running at the optimum level.
And to take it even one step further, your accountant is a great resource to tap into for business valuation and business consulting purposes.

Whether you need to get your financial statements in order or an audit to present to potential investors, exploring the spectrum of services your accountant offers could help you turn that once-a-year, tax-time meeting into an invaluable year-round resource.
Luckily, there are quite a few effective options available that won't take a nasty toll on your budget.

What isaccounting?
Accounting refers to the practice of tracking a business's income and expenses and using those figures to evaluate its financial status.
One of the most basic accounting services is bookkeeping, which involves keeping a record of all financial transactions and then preparing financial statements such as balance sheets and income statements. Accountants can then take this information and roll it into tax services, another basic accounting service.
But the business of accountants goes beyond just basic number-crunching. Accountants include a number of other services in their repertoire: auditing services, tax planning, business consulting, business valuation, and financial planning, just to name a few.

Bookkeeping
In bookkeeping, an accountant keeps a comprehensive record of how much your business owes creditors and how much is owed to you. The records of these transactions also indicate how much you have invested in equipment and inventory.
Typically, accountants handling the books take care of accounts receivable and accounts payable, put together financial statements (such as balance sheets, income statements, and cash flow statements) and take care of bank reconciliation.
The cost climbs as the volume of work expands. The more transactions and the more statements you expect your accountant to prepare, not to mention how often you want these financial statements whether they be monthly or yearly, the more you'll pay.

Tax services
Taxes are one of those areas that can easily be underestimated. When tax time rolls around, a good accountant, in preparing your return, can help ensure that the necessary steps have been taken to minimize filing errors that can trigger an audit.
But if you're just in and out of your accountant's office when it comes time to do your taxes, you could be missing out on a major money-saver.
A knowledgeable tax accountant can suggest ways your business can save thousands of dollars through tax planning and tax-saving strategies. In tackling these issues, you and your accountant can also look for ways to add value to your business.
Of course, the more complex the tax planning and the more ongoing the tax services are, the higher your bill. But in the long term, the tax dollars saved makes this extra expense worth every penny.

Audits
Audits are mandatory for public companies; private companies don't have to conduct audits unless a bank or an outside investor requests one.
Accountants might handle an audit for a private company, for example, that is looking for funding from investors who want to have an independent opinion on the fairness of the company's books, financial statements, and financial position.
Most audits can be divided into two phases: the accounting work done to prepare for the audit, and the audit itself.
Make sure it's clear in the beginning what you're paying for. While some accountants will give you cost estimates for these two aspects of the audit, others will simply give you one estimate for the audit and add-on costs at the end for the preparation.
Here are a few things to consider when trying to hold down the cost of an audit, one of accountants' more expensive services because of the detail and time that is usually involved:

• Do some of it yourself. Have your in-house staff prepare the necessary documents for the audit. This cuts down the preparation time that your accountant would have otherwise spent just getting things in order for the audit - time that you would have been billed for.
• Hand over clean books. The cleaner and clearer the books, the less time it takes for your accountant to get through all the paperwork.

Other services
There are also a few other more specialized services accountants can provide.

Reviews
Reviews are less detailed than audits. For a review, your accountant will determine whether the financial statements fairly represent the company's financial status.
Reviews, which are smaller in scope than an audit and therefore less expensive, are usually done on a quarterly basis for public companies since it is not required that public companies have quarterly figures audited.
Unlike the more critical evaluation of an audit, however, that actually tests the details documented, reviews simply touch upon the reasonability of the statements and offer a limited opinion.

Compilations
Compilations are even less detailed than reviews, and they don't involve any opinion on the part of the accountant. For a compilation, your accountant will simply take the financial general ledger and create financial statements from it.

Business consulting
Business consulting is one of the more specialized services, so the rate or fee may reflect that.
If you're exploring a specific aspect of your business, for example looking to cut costs and improve your profit and loss statement, it's a good idea to look for an accountant who not only has experience in business consulting but one who is also familiar with your industry and market.

Business valuation
Business valuation is also a specialized kind of service, so as with consulting, you can expect the costs to go up.
Business owners might want a business valuation if they are looking to sell the company or if they want to do some estate planning. Business valuations are also useful when applying for a loan.
In any case, you'll want to find an accountant who has experience dealing with companies in your industry and market. An accountant with this kind of background will have more insight into your particular situation than one who is just stepping in with no frame of reference to draw from.

Financial planning
Financial planning has really taken off in the past five to 10 years for accountants. This service turns the focus from the business to the business owner. The need for financial planning becomes more pressing when a business owner starts to look at long-term care insurance, wills and trusts, and estate planning.
For instance, if one wants to pass the business on to his or her family, an accountant could suggest ways of doing so without having the family hit by a huge tax burden.

Pricing
While the costs can run the gamut depending on your company's specific needs, accountants usually charge a flat rate per month for basic bookkeeping services.
Rates can vary depending on your geographic area, the size of the firm, and the experience and seniority of your accountant. But even for the most basic of bookkeeping services, you can expect to pay $1,400 to $1,500 per month.
Sometimes in the beginning, accountants will charge an hourly rate until they get a feel for your business and how much time is involved in the work you want done. A few months into it, you can usually negotiate a flat fee for your long-term needs.
For more in-depth and complex services, such as financial planning, accountants typically charge an hourly rate.
Focus groups are helpful because the participants can be probed for the reasoning behind their opinions, and conversations can be generated around a particular topic - giving you what's known as "rich data" as opposed to, for example, the finite answers you get from survey questions.

Cutting costs
While costs will vary depending on your individual business and the accountant you've hired, here are a few tips that can help you keep your costs down.

• Keep records as automated as possible. This makes it easier for the accountant to access the information.
• Keep records as clean and clear as possible. If it is difficult for the accountant to decipher ledgers, it just means more time for them and more money out of your pocket.
• Do your homework. Do what you can as you can to get all of the simple paperwork out of the way on your own, especially in the case of an audit, which can be costly.
• Hire temps. If you need someone to only take care of running the books, you may want to consider hiring temporary help. This is cheaper than going to a CPA for basic bookkeeping.

Ref: http://www.entrepreneur.com/article/51810#ixzz2gALVgfNN

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How Long Should Keep Financial Records?

This isn't another sermon on the importance of financial record-keeping. Just the opposite: It's about discarding unnecessary records to free space in your overstuffed file cabinets. But which records should you keep and which can you trash?

Tax returns and supporting data should be kept for at least seven years. Beyond that term, CPAs suggest keeping returns forever (particularly if you have tax-deferred retirement accounts); you may toss the backup materials.

Things like audit reports, financial statements, general ledgers and journals should be stored through eternity, along with legal correspondence, contracts, documents related to real estate transactions (including capital improvements) and all corporate records (from articles of incorporation to any paperwork relating to shareholders).

Six years is about the limit for keeping bank statements, deposit slips, sales records, journals and any materials relating to employee income or expenses.

Items that can be discarded after three years include canceled checks, paid invoices, payroll records, depreciation schedules, paperwork relating to expenses, donation receipts, real estate tax bills and inventory records.
You can trash the rest--if you dare.

Ref: http://www.entrepreneur.com/article/22816#ixzz2gAIi4cVY

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Why You Need an Accountant ? Sholud to Know!

Should I hire an accountant? Also, how can I make the most of this business relationship? One aspect of running a small business that few people give a lot of thought to is the way they deal with professional vendors such as bankers, lawyers, accountants and so on.

Most entrepreneurs just dive right into their businesses without giving a second thought to how these professionals should be treated, what they can do for you and what they in turn look for in clients. With a little thought and effort, you can ensure that you get the most from these relationships.

The main thing to remember is that you need a personal relationship with each of these people. They have the ability-sometimes direct, sometimes indirect-to drastically influence the success of your business. Your goal should be to develop a long-term, personal relationship with each of them. If you do that, when you hit a bump in the road, they'll be there to help you get over it.

As you become more experienced, you'll find that your accountant and attorney will overlap a bit in their services and expertise. I've found that mine often work together to achieve what I'm trying to do. That being said, here are a few examples of services your accountant should provide:

• Help you decide what type of entity (such as S-Corp or LLC) and ownership structure to have when you first get started; your accountant should work with your attorney on this.
• Design and set up your accounting system so that year-end financial reporting will be easier.
• Ensure that you pay the correct types of taxes in the correct amounts.
• Ensure that you send out W2 and 1099 forms to the proper people at the proper times, and also make sure that if you send out 1099s, the IRS will agree with you that those individuals are independent contractors and not employees. This is a common mistake that can cost you a lot of money and stress.
• Advise you on deductions and how to separate your personal and business expenses.
• Advise and guide you through an audit if you ever have one.
• Advise you on specific transactions, such as whether it's better to lease or buy.
• Compile your financial records for the past period.
• Help you understand your financial statements. You should use your accountant's expertise to help you analyze your financial statements so you can understand what he or she is telling you. If you neglect to do this, you won't know as much as you should about how your company is doing.

You will also need an accountant if you have questions about what kinds of business expenses are deductible. Most of these rules and regulations are moving targets-they change frequently and often vary from state to state. A good accountant will always be on top of the changing laws and regulations and, more importantly, will know what applies to you.

It's also important to ask your accountant's advice before you take action. It's almost always easier (and cheaper) to structure things properly upfront, as opposed to trying to fix something later.
I've noted in previous columns concerning your banker and attorney how important it is to develop close relationships with them, make sure they completely understand your business and your goals for it, and trust them to help you attain those goals. This advice applies to your accountant as well-if you take that advice, he or she will be a valuable long-term partner.

Ref: http://www.entrepreneur.com/article/52324#ixzz2gADZQXgE

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11 Expectations You Should Establish For Your Bookkeeper

You may be a successful business owner with a multitude of skills, but if bookkeeping is one of your weakest links, you should probably hire a bookkeeper to help you out. But before you bring someone on board, you need to make sure they know what to do, and you'll want to set expectations for them in order to get what you need.

Here are 11 expectations to Set for Your Bookkeeper and ensure that they're going to provide the service your business needs:

1. Your bookkeeper must have a basic understanding of bookkeeping/accounting terms.
They should have a basic understanding of the difference between the five basic types of accounts (assets, liabilities, equity, income and expenses).

2. They must be detail oriented.
You need someone who's going to be able to focus on the little things: This will enable the big things to take care of themselves. You don't have time to babysit them; they need to be able to take charge and take care of all the little things that need attention when it comes to your basic financial operations.

3. They must have an understanding of the big picture.
If you buy a piece of equipment, are they going to understand the concept of setting up the asset and liability accounts? Do they know how to allocate the payment to interest expense and liability principal reduction?

4. They must have a willingness to follow through.
You want someone who'll ensure that projects and questions are followed through to completion. They need to be responsible for the follow through because you're just too busy to be the one in charge of project completion. You're there to assist with questions, but the financial projects have to be something they're in charge of.

5. They must have monthly financial statements available by the 10th of the following month. The three basic financial statements include the balance sheet, the profit/loss statement and the cash flow statement.

6. They must understand how to do proper job costing.
It's important that they are tracking all the costs by item and job detail. Job costing is critical to the success of knowing how much your projects are truly cost. You have to be able to depend on their information to be reliable.

7. They must have a basic understanding of your industry.
While this is something that can be learned, you'll be miles ahead on the learning curve if the person you hire has a general understanding of your industry. And while bookkeeping for a retail store, hair salon, internet service business and many others have the same basic bookkeeping fundamentals, it's not exactly the same. Each industry has different terms and insider aspects that can only be learned on the job, so be sure to look for someone with experience in your industry.

8. They must have good communication skills.
If your bookkeeper doesn't understand something, they've got to be willing to ask for clarification or help. Communication is critical so that you'll have a good understanding of what's taking place in the office without you having to be the one doing the day-to-day work.

9. They must be computer literate.
The days of doing almost anything by hand are long gone. You must have a computerized bookkeeping system to be able to get quality reports. Your bookkeeper should not only know the basics of your bookkeeping software but should also be familiar with Word, Excel, e-mail and the internet.

10. They must be interested in continuing their education.
They should be committed to enhancing their skills with additional classes or self-study to ensure that they're staying up to date with the accounting skills your business demands.

11. They must be willing to make a strong commitment to your business.
 If you're hiring a part-time bookkeeper, it's essential that you find someone who will make your business a priority. Don't let your part-time bookkeeper "squeeze" their responsibilities to you into their personal life. This is one of the biggest issues I see with many small businesses. The owners allow their bookkeepers to do their work whenever they have time. But by doing this, you're enabling them to put your business at the bottom of their "priority" list. You need someone who's focused on ensuring things get done.
If you want your company to truly function in a profitable way, it's critical that you set expectations for your bookkeeper before you bring them on board. Good financial records are fundamental to the success of your business. If you can't rely on your books--or your bookkeeper--then how are you going to know where your business is headed? Set these expectations for your bookkeeper so they'll be a successful part of your team. You'll be setting your business up for success.

Ref: http://www.entrepreneur.com/article/159788#ixzz2gA6yUKoM

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