WHEN SHOULD I NOT TRUST MY BOOKKEEPER/CONTROLLER?
- shneor fridman
- Sep 18, 2024
- 1 min read
Bookkeepers and controllers are usually trained professionals, but even they have limitations. It's important to know when to question the financial statements they provide.
Recognizing the Limits
Understanding Business Logic: If a financial statement doesn't make sense to you, it might be because the bookkeeper doesn't fully grasp that part of the company.
Complex Business Structures: Controllers and CFOs can struggle with the complexities of certain businesses, especially those with unique structures or government grants.
A Real-World Example
I once worked with a company that had three controllers—all CPAs—within two years. Despite their qualifications, they couldn’t fully understand the company's structure and business logic due to its complexity. This lack of understanding led to inaccuracies in the financial statements.
When to Question Financial Statements
Unfamiliar Reports: If reports don't align with what you know about the business.
High Turnover: Frequent changes in financial staff can lead to errors.
Complex Accounting Needs: Businesses with multiple revenue streams or unique accounting requirements are at higher risk for misclassifications.
Key Takeaways
Stay Involved: Regularly review financial statements and ask questions.
Provide Clarity: Ensure your financial team understands the nuances of your business.
Commentaires