This blog post is based on a limited series by Follow the Bookkeeper, hosted by Morgaine Trine.
Here are the key points covered:
Challenges in Finding a Bookkeeper:
Lack of Standardization: There's no requirement for certification or a degree to become a bookkeeper. This can make it difficult for business owners to assess qualifications.
Misconceptions about Bookkeeping: Bookkeeping is often seen as a basic administrative task, but it requires knowledge of tax implications and law.
Bookkeepers vs. Management Needs: Some bookkeepers may not understand the difference between bookkeeping for compliance (tax purposes) and for management decision-making.
Challenges in Finding a Tax Preparer:
Different Designations: There are various tax preparer designations with varying levels of expertise:
CPA (Certified Public Accountant):Longest investment to achieve, requires a degree and passing a rigorous exam.
Enrolled Agent (EA): Designation by the IRS allowing tax preparation and representation, requires passing a rigorous series of exams..
Tax Preparer: Anyone can file taxes in most states with little to no regulation.
Shrinking Talent Pool: Fewer people are entering the accounting field due to demanding work schedules and lower compensation compared to other financial professions.
Impact of the Pandemic: The pandemic caused many older CPAs to retire or leave the profession, further reducing available qualified professionals.
Additional Points:
The roles of bookkeepers and tax preparers are evolving due to cloud-based accounting technology. This means their services can vary, making it crucial to understand what each professional offers.
Unfortunately, some bookkeepers and tax preparers disappear unexpectedly, leaving clients scrambling for replacements.
Recommendations:
Consider having separate bookkeepers and tax preparers to limit liability exposure and create a system of checks and balances.
Clearly define your needs when searching for accounting professionals.