TL;DR
A bad bookkeeper costs you more than their fee. Missed deadlines, messy books, and unreconciled accounts add up fast. Here's when to make the switch and what to look for.
I get this call at least twice a month. A business owner brings me on as their fractional CFO, and within the first week I can tell the bookkeeper is the problem. Not because they're a bad person. Because they're in over their head, and nobody caught it until the damage was done.
Here are the signs.
Your Books Are More Than 60 Days Behind
If it's March and your books are only done through December, you're flying blind. You're making decisions about hiring, spending, and pricing based on financial statements that are three months stale. A good bookkeeper has your books done within two weeks of month-end. Every month. No exceptions.
I had a client in the trades doing $1.5M in revenue. Their bookkeeper was six months behind. When we finally got the books current, we discovered they'd been losing $8K per month on a specific service line. Six months of losses that could have been caught after the first month.
Bank Reconciliations Don't Match
This is bookkeeping 101. The balance in QuickBooks should match the balance at the bank. Every month. If your bookkeeper can't reconcile the bank accounts cleanly, nothing else in your financials can be trusted. I've seen reconciliation differences of $30K or more that sat unresolved for months.
HST or Payroll Remittances Are Late
This is not just sloppy. It's expensive. CRA charges interest and penalties on late remittances, and they can assess personal liability against directors for unremitted payroll source deductions. If your bookkeeper is responsible for remittances and they're consistently late, you're accumulating risk every month.
According to the Canadian Payroll Association, 26% of Canadian workers report that payroll errors have caused them financial stress. That's your team losing trust in your business because the books aren't right.
They Can't Explain the Numbers
Ask your bookkeeper: "Why is revenue down 15% from last month?" or "What's in this $18K clearing account?" If they can't answer without going away for a week, they don't understand your business well enough to keep it. A bookkeeper should know your accounts well enough to spot anomalies and explain them on the spot.
They Don't Use Your Industry's Best Practices
Construction bookkeepers need to understand job costing. E-commerce bookkeepers need to handle multi-currency and platform fees. Professional services firms need time tracking integration. If your bookkeeper treats every business the same way, you're getting generic work for an industry-specific problem.
What to Look For in a New Bookkeeper
When you're ready to make the switch, here's what matters.
Industry experience. Have they worked with businesses like yours? Ask for references from similar companies. A bookkeeper who's done five years of construction accounting will save you more money than a generalist at half the price.
QBO proficiency. They should know QuickBooks Online inside and out. Custom reports, bank rules, automated categorization, class tracking. If they're still doing things manually that QBO can automate, they're wasting your money.
Month-end timeline. Ask them: "When will my books be done each month?" The answer should be within two weeks of month-end. If they hedge, keep looking.
Communication style. You want someone who flags issues proactively. "Hey, I noticed your AR over 90 days is up 40% from last month. Want to look at that?" versus silence until you ask. Proactive bookkeepers save you money. Reactive ones just record what happened.
Clean transition plan. A good bookkeeper will help you transition smoothly. They'll document the chart of accounts, recurring entries, and any quirks in the file. If your current bookkeeper refuses to cooperate, that tells you everything you need to know.
How to Make the Switch
- Get your current books as current as possible. Even if you have to pay extra to get them caught up before transitioning.
- Export everything. Download your QBO backup file. Export all reports for the current year and prior year.
- Overlap by one month. Have the new bookkeeper start while the old one finishes their last month. This catches any discrepancies.
- Review the opening balances. The new bookkeeper should verify that everything carries forward correctly. Don't assume it does.
- Set clear expectations. Monthly close by the 15th, reconciliations done, remittances filed. Put it in writing.
The Bottom Line
A good bookkeeper costs $500 to $1,500 per month and saves you multiples of that in clean data, on-time filings, and financial clarity. A bad bookkeeper at any price is more expensive than no bookkeeper at all, because bad data leads to bad decisions. If you're not sure whether your bookkeeper is helping or hurting, book a free call and I'll take a look.
Next step: run your numbers through the free CFO scorecard.
Frequently Asked Questions
- How do I know if my bookkeeper is doing a good job?
- Your books should be reconciled monthly, bank balances should match QBO, HST and payroll remittances should be filed on time, and you should be able to pull a clean P&L any day of the month. If any of these are consistently off, there's a problem.
- How much should a bookkeeper cost in Canada?
- For a small business under $2M in revenue, expect to pay $500 to $1,500 per month for a competent bookkeeper. Below $500 and you're likely getting part-time attention. Above $2,000, you might need a different solution.
- Should I hire an in-house bookkeeper or outsource?
- For businesses under $3M in revenue with fewer than 20 employees, outsourcing is usually more cost-effective. You get experienced help without the overhead of salary, benefits, and training. In-house makes sense when transaction volume is high enough to justify a full-time role.
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