By Melissa Lagowski
Founder/CEO/Queen Bee
If your nonprofit or association manages cash flow or oversees the filing of financial documentation on a regular basis, check out these warning signs that indicate when it’s time to hire a new bookkeeper.
1. Missed Deadlines
Reconciliations and reporting are on a steady and predictable cycle. Bank statements are issued by the end of the month, so the bookkeeper should be able to reconcile all accounts and provide the monthly reports by the 15th of the following month.
Governmental deadlines are also established and follow a regular pattern for submissions. If your filings are not managed properly, your organization’s nonprofit status could be in jeopardy.
2. Lack of Communication
Does your bookkeeper proactively reach out to you about your financial matters? Do they answer questions in a timely manner? If you are having to constantly contact your bookkeeper to inquire about regular reporting and other requirements and deadlines, you should be concerned.
3. Does Not Utilize A Budget
The best bookkeepers will encourage their clients to work from a budget. This is a tool to help you navigate the year and identify if any adjustments might need to be made throughout the year. Running an organization without a budget is like planning a trip around the United States with no GPS. Your budget is a roadmap that evaluates data month by month to see if your organization is on target for the year or if you need to increase fundraising or tighten the belt on spending.
4. No Systems
Financial systems establish proper record-keeping. Whether it be timekeeping, expense tracking or reconciling event registrations, good systems will ensure that your organization is receiving all of the funds due and that all payables are issued in a timely manner to protect your credit record. A lack of systems could cost your organization money and create problems if the IRS is to ever audit your nonprofit.
5. Lack of Collaboration
The bookkeeper is instrumental and pivotal in successfully completing your audit (when required) and filing your quarterly/annual reports. If the team is not working collaboratively, this can delay the ability to meet necessary deadlines. If you are ever in doubt about the quality of your bookkeeper’s work, reach out to your auditor or CPA and ask for their feedback.
6. Problem-Solving
An ideal bookkeeper is going to be proactive in resolving problems for you. They will discover and bring up issues in a timely manner and discuss potential solutions with the financial team. They will analyze your data, resolved discrepancies and share insights with you about your financial position.
Regularly assessing these aspects can help you determine if your bookkeeper is performing well and if any areas need improvement. If there are concerns, addressing them promptly and providing additional support or training can protect the financial wellbeing of your nonprofit.
Your bookkeeper is one of the most important members of the team, and these guidelines will instruct your decisions to ensure the right person is doing the job right. For more insights into nonprofit bookkeeping, read “Navigating Nonprofit Finances: How to Effectively Manage Your Bookkeeper.”
