Do you know how to prepare bookkeeping interview questions for a potential hire? Maybe you never even knew that you should prepare anything specific. We’re here to tell you that the questions you ask can make a huge difference in the type of person you end up hiring. So, in this post, we’ll go over the importance of formulating and delivering these questions. We’ll also talk about how to assess responses.
Understanding the Role and Requirements of a Proper Bookkeeper
Every bookkeeper typically takes care of key responsibilities and possesses a general set of skills for the job.
Accurately recording financial transactions is the core of bookkeeping. Bookkeepers also reconcile bank statements so they match the company’s internal records. They maintain and update the general ledger and generate essential financial reports for your review.
Bookkeepers manage accounts payable (money owed to vendors) and accounts receivable (money owed by customers). This includes sending and receiving invoices, processing payments, and chasing outstanding debts. In some cases, a bookkeeper will also handle payroll processing. Note that this requires a strong understanding of payroll taxes and deductions.
To do these tasks, a bookkeeper will have several core skills. They will understand generally accepted accounting principles (GAAP) for accurate bookkeeping. They will also have a keen eye for detail in data entry and record keeping. Basic analytical skills are necessary to interpret financial data and identify trends. Most businesses also highly value familiarity with popular accounting software like QuickBooks or Xero and proficiency with common office software.
The best bookkeepers have effective organization and time management skills, too. This helps them handle multiple tasks efficiently to meet deadlines while maintaining accuracy. Bookkeepers should also be able to communicate clearly and concisely, both verbally and in writing. This is not common but important for interacting with people in your company, your accountant, and other stakeholders.
For certain industries, bookkeepers need to know specific regulations and accounting practices. Some bookkeepers may assist with basic tax preparation tasks, for example.
The impact of a skilled bookkeeper on business health and growth
A skilled bookkeeper can bring improved financial accuracy and transparency to your business. They ensure your financial records are accurate and up-to-date to eliminate errors and discrepancies. With this accurate data, you can make informed business decisions. You can also identify areas for cost savings, optimize resource allocation, and make adjustments to reach your financial goals.
Skilled bookkeepers can automate repetitive tasks to focus more time and resources on core business activities. By monitoring accounts payable and receivable, they help optimize cash flow so you can always cover expenses. This saves you from late payment penalties and other risks of non-compliance.
Speaking of compliance, accurate bookkeeping minimizes errors that lead to legal trouble. Skilled bookkeepers can ensure your books follow the applicable tax regulations so you can avoid tax audits.
Bookkeepers can help you create realistic budgets and financial forecasts by analyzing past financial data. This aids in planning for future expenses and setting achievable financial targets.
Essential Bookkeeping Interview Questions
Below are some examples of bookkeeping interview questions you can ask, decided by essential categories. Each one is followed by a tip for guiding the discussion.
Technical Skills and Knowledge
“How do you stay current with changes in accounting laws and regulations?”
- Focus on how diligent they are in staying updated as compliance with these rules is essential. Follow up with how they adjust to changes.
“Can you explain the difference between accrual and cash basis accounting, and how each impacts financial statements?”
- Listen carefully to how helpful their answer is to your understanding of these two methods. You want to see not only if they know but if they will volunteer crucial information.
“What experience do you have with cloud-based accounting software, and which do you recommend for our business needs?”
- Use this questions to confirm how well they know the software you want them to use. Moreover, pay attention to the quality of their recommendations as this can tell you lot about their skills and intelligence.
Experience and Background
“Describe a complex financial project you managed and the outcome.”
- Track the thought process here so you can evaluate their decision-making and skills.
“Can you share an experience where you identified a significant error in a company’s books? How did you address it?”
- Focus on how they went above and beyond rectifying the error. For example, did they care about sparing or maybe even repairing the company’s reputation?
“What industries have you worked in, and how has this experience prepared you to work with our company?”
- Note the connections between different work experiences and how it can bring value to your business.
Scenario-Based Questions
“Imagine you find a recurring error in monthly reports that went unnoticed for a year. How would you address this with the team and rectify the situation?”
- Note especially how they take responsibility for this error. Moreover, track how they would handle leading the team to correct it and improve so that error never happens again. Having a system for growth in service quality is a major area for consideration.
“If you’re tasked with reducing overhead costs, what steps would you take to analyze and identify potential savings?”
- Focus on what they are already implementing to help businesses reduce costs while maintaining integrity. Ask for specific examples if they don’t offer any.
“How would you handle a situation where you have to prepare a financial report for stakeholders in a very short timeframe?”
- Look for stress indicators here and note how they respond to having to go beyond the usual expectations.
Ethics and Confidentiality
“Have you ever faced a situation where you were asked to act against your ethical standards? How did you handle it?”
- Pay close attention to how they balance respect for a client and not compromising their core values.
“How do you ensure the confidentiality of sensitive financial information?”
- Take note of this and follow up later to see if they have actually implemented the steps they outlined. This is crucial to your relationship moving forward.
“Can you describe a time when your integrity was challenged at work, and how you responded?”
- Try to discern how important integrity is to them based on their response while paying attention to how they handle the challenge. Balance is important here, not allowing an offense to slide but not overreacting, either.
Cultural Fit and Communication
“How do you approach resolving disagreements with colleagues, especially when it comes to financial discrepancies?”
- Note how healthy their approach is to conflict in the work environment. Look at their boundaries and how they honor your company in the process.
“Describe how you have adapted your communication style to fit different team dynamics.”
- Communication is so important, so you want to see how this potential new team member will adjust to fit in.
Assessing Answers and Red Flags
Interpreting responses to interview questions
Mark candidates who provide specific details about their experience. Those who offer only general statements may not actually have the experience you need. Even if they do, their lack of details may indicate a lack of motivation.
Always keep a focus on evaluating the depth of a candidate’s knowledge in core bookkeeping tasks. This should be at the back of your mind as you converse. If your industry has specific bookkeeping requirements, make sure you assess their understanding of those nuances.
Don’t forget about the soft skills. Mark candidates who answer clearly and concisely and don’t try to use overly technical jargon. This can indicate that they are not just trying to impress you. In any case, avoiding jargon shows that they care more that you understand. This means they are used to dealing with clients. Note that bookkeepers also need to communicate clearly with your accountant and possibly other stakeholders. Make sure they can express themselves clearly.
Pay attention to how a candidate approaches hypothetical scenarios. Look for logical reasoning and a step-by-step approach to problem-solving. Observe their communication style throughout this process. They should be professional and courteous on top of having the ability to explain complex financial concepts in layman’s terms.
Look for candidates who demonstrate enthusiasm and a genuine interest in bookkeeping and in your company. This indicates potential for good work and a long-term engagement. At this point, assess how well the candidate aligns with your company culture. Mark the ones who share your values and demonstrate a work style that fits yours.
Warning signs that a candidate may not be the right fit for your business
Be wary of candidates who hesitate when answering questions or provide only vague responses. Look out for candidates who seem overly meek, too. They may just be shy, but they may also be unmotivated. While confidence is good, overconfidence can be damaging. Look for someone who acknowledges the need for continuous learning and professional development. Avoid candidates who tend to speak ill of previous clients as they respond to your questions. This can be a sign of potential interpersonal issues and how they may end up treating you, as well.
In terms of the areas that cover technical skill and knowledge, watch out for candidates who struggle with basic bookkeeping questions. This type of candidate will likely require significant training to be effective. This includes anyone who seems unfamiliar with the most popular accounting software. At best, you’ll need to train them. The worst case scenario is if they are also resistant to learning the software you use.
Sometimes, a candidate will have misaligned salary expectations. They may quote significantly higher than your budget or lower than the market average for the position. Be wary if they give no clear justification for this, and make sure you get clarification. Then you can justly evaluate and see if they can still work for you.
Look out for large, unexplained gaps in their work history. This can be a grave concern. Don’t be shy about finding out why during the interview. The same goes for any concerns you might have about their online presence. What they do on socials may not be a deal breaker, necessarily. You may not want to condone certain behavior, however, so check them out on social media and professional networking platforms.
Steps to Take Following the Interview
After a successful interview, you need to ensure a smooth follow-up process. Make sure you review your notes while the interviews are fresh in your mind. You need to compare each candidate’s responses, strengths, and weaknesses. Pay special attention to how their skills and experience align with the job requirements.
If you have a few people on your management team you can consult, schedule a meeting with them. Their input can be invaluable. If you interviewed with others on a panel, consolidate your notes. This will help you to identify any areas where you might need further clarification before making the final decision.
Make sure that you don’t leave other candidates hanging after you create your shortlist. Promptly send each one a thank you email to express your appreciation for their time and interest in the position. Even though they may not have been great fits, they still made an effort to talk with you. For those move forward in the process, reach out to reiterate their next steps. Make sure to contact their references if you haven’t yet.
Once you choose the one you want to hire, confirm that they are happy with your offer. This includes the pay, any benefits, the start date, and key details about the work.
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AccountsBalance is a monthly bookkeeping service specialized for agencies & SAAS companies.
We take monthly bookkeeping off your plate and deliver you your financial statements by the 15th or 20th of each month.
You’ll have your Profit and Loss Statement, Balance Sheet, and Cash Flow Statement ready for analysis each month so you and your business partners can make better business decisions.
Interested in learning more? Schedule a call with our CEO, Nathan Hirsch.
And here’s some free resources:
In Summary
To find the bookkeeper who can meet your needs, you must ask the right bookkeeping interview questions. These questions help you identify the candidate with the key responsibilities and skills to ensure the accuracy of your company’s financial records. This helps you gain efficiency and stay organized so you can make informed financial decisions and achieve your business goals.
Remember that the interview is a two-way street. As you evaluate candidates, give them a chance to ask questions about you and your company. This helps both sides set clear expectations that pave the way for a more fruitful working relationship. This initial rapport can also help you better identify the best candidate for your business needs.
