How to work with a bookkeeper

The first month sets the pattern. Before work begins, gather:

• access to statements for every bank, card and loan account, view-only where the bank allows it
• a login to the bookkeeping system in the bookkeeper's own name, with the business keeping the main administrator login
• the last reconciled balances and any earlier records, so the books carry on from a known point
• a list of regular customers and suppliers, recurring bills and anything unusual about them
• details of any loans, payment plans, leases or money owed between the business and its owners
• your accountant's contact details and what they need at year end
• the name of the person in the business who answers which kinds of question.

Giving the bookkeeper their own login, rather than sharing yours, keeps the business in control of its records and shows who did what.

Agree one place for documents, such as a shared folder or an email address used only for bills and receipts, and a day each week when everything goes in. Send:

• supplier bills as they arrive
• receipts for card and cash purchases, each with a word on what it was for
• sales records from anywhere outside the main system, such as a market stall or an online store
• receipts for business costs you paid personally
• anything that looks unusual, with a note.

Some lines on a bank statement can only be explained by you. The ATO's list of what a record should generally show includes what the transaction was for and, where it matters, how the parties are related. A bookkeeper can see the date, amount and payee, but not why the payment was made or that a supplier is a relative.

Ask for queries as a single list each week and answer it in one sitting. Until an item is answered, it is usually held in a holding account rather than guessed at, and holding accounts with old items in them make every report less reliable.

• Supplier payments: the bookkeeper prepares them, someone in the business approves them.
• New suppliers and changed bank details: confirm them yourself, by phone on a number you already hold, before the first payment.
• Credit notes and refunds to customers: signed off by the owner or a manager.
• New accounts in the chart of accounts: agreed, so reports stay comparable from month to month.

business.gov.au suggests reviewing your main financial documents regularly and looking for trends or anything unusual, such as falling sales, low profit margins, spending above budget, the level of debt and periods of high or low cash flow. A short monthly session with your bookkeeper's reports covers most of it.

The ATO says the owner keeps primary accountability for record keeping even when someone else does the work. Asking about what you don't recognise is part of that, and it is how mistakes are found while they are easy to fix.

The ATO notes that as a business changes or grows, the records it needs may change too. Let your bookkeeper know before any of these happen, so the books are ready when the first transaction arrives:

• a new bank account, card or loan
• a large purchase of equipment or a vehicle
• taking on an employee
• a new way of selling, such as an online store or a marketplace
• a change in how the owners take money out or put money in.

Your bookkeeper keeps the day-to-day records, and your accountant works from them. Ask your accountant what they need from the books at year end, pass that list to your bookkeeper, and agree who answers your accountant's questions about entries.

1. Agree the last month the bookkeeper will complete and reconcile.
2. Collect the reports, reconciliations, query list and any working files up to that month.
3. Remove their access to the system, bank accounts and shared folders.
4. Give the next bookkeeper the same starting pack you would give anyone new.

If the change means a new system, keep a full copy of the old records before anything is closed, so the original data can still be rebuilt.