What are the best options for keeping your books?
By Shelley Widhalm
As a QuickBooks consultant, Debbi Allison of Open Book Consulting takes care of a client’s ABCs.
The ABCs refer to accounting, bookkeeping and consulting to help business owners keep their books and prepare their taxes, but there are differences among the three, said Allison, owner of Open Book Consulting in Loveland and a ProAdvisor for QuickBooks, an accounting software package offered by Intuit.
“All three of them are necessary on some level: you need your taxes done; you need your books to be clean; and you need somebody to bring all the numbers together to make smart business decisions,” Allison said.
Accountants vs. Bookkeepers vs. Consultants, or the ABCs
Accountants prepare and inspect financial statements that include the balance sheet, income statement and statement of cash flows to ensure a business’s records are accurate, up-to-date and comply with regulatory standards. They can provide bookkeeping and tax preparation services and may be an employee of a company or hired as a third party.
Certified public accountants are accountants who meet state law requirements and have earned a certificate, while audit accountants verify the work of CPAs and accountants, checking that records represent the company’s financial position and, if it occurs, detecting any fraud.
Bookkeepers, which unlike accountants are not regulated, have a basic understanding of accounting and its applications. They work with companies on a daily basis, keeping the account books and recording the transactions of a business that include expenses, income, payroll, bill payments, and sales and other taxes.
“A bookkeeper handles document management, which means doing the filing and making sure all of the correct documentation is being retained for the business,” Allison said. “They’re not providing advisory services. They are not diagnosing the books but only maintaining them.”
What Consultants Offer
Consultants understand the principles of bookkeeping and accounting and know how to apply the numbers to help companies make smart business decisions and more efficiently run their businesses, Allison said.
“A consultant comes in as a teacher and says, this is how your books work. This is how it should be set up and why it should be set up that way,” Allison said. “Few tax preparers provide consulting or provide education to explain what they’re doing. … As a consultant, I help the customer determine how to run their business in a more knowledgeable way based on their numbers.”
Allison is interested in her clients’ goals for their businesses and helps them identify the steps they can take to align their monthly and yearly numbers with those goals.
“I like not just getting to the numbers but to the emotional side of the equation to define why you are doing it,” Allison said.
What to Consider When Hiring the ABCs
Businesses seeking to hire an accountant, bookkeeper or consultant should consider their qualifications and level of experience, whether they carry insurance and their reputation, Allison said.
“Having qualified help or assistance is an investment in the future of your business,” Allison said.
The three should carry some form of errors & omission insurance, a type of general liability insurance on their knowledge that ensures they do not knowingly engage in fraudulent transactions.
“If we find it, we can fix it in a good faith effort. The problem is if the business doesn’t do anything about it,” Allison said.
Alison recommends checking references to ensure the three are knowledgeable about their practices and have a good reputation, are reliable and trustworthy, and handle their practice in a professional manner.
“Do you enjoy working with them? Do you feel they are competent? Do they take the time to explain things to you when you have a question?” Allison said.
Allison, who holds an associate’s degree in accounting, started her career as a bookkeeper in 1999, a service she continued to offer on a fulltime basis until 2013 in several industries including medical, insurance, retail and construction. In 2011, she launched Allison Bookkeeping, LLC, changing her name to Open Book Consulting in June 2016 to better represent what she offers. She is an enrolled QuickBooks ProAdvisor agent, advanced certified since 2016 in the program’s online version and standard certified in the desktop version since 2012.
“Open Book says to me transparency,” Allison said. “I want people to understand their books. I still offer bookkeeping services, but I do more consulting and training.”
Allison teaches a fee-based QuickBooks Online course through the Larimer Small Business Development Center in Fort Collins on a quarterly basis. The next class will be 1-5 p.m. Feb. 1, 8 and 15.
“It’s more fun for me to go to the business owner and work in the trenches,” Allison said. “I get a lot more enthusiasm working day to day with business owners and working with them on their goals.”