How to Check the Work of Your Bookkeeper and Ensure Accuracy in QuickBooks Online

Dany Ortega
May 8
4 min read

As a construction business owner, you know that keeping your finances in order is essential to maintaining a successful operation. While you may rely on a bookkeeper to handle your financial records, it’s crucial to periodically check their work to ensure that everything is being done correctly, especially when using QuickBooks Online (QBO). Here’s how you can do it:

1. Review Your Chart of Accounts

The first step in reviewing your bookkeeper’s work is ensuring your Chart of Accounts is set up properly. QuickBooks Online should have categories that align with your construction business's needs, including:

Income Accounts: Separate accounts for different types of projects, whether residential, commercial, or specialized services.
Expense Accounts: Categories like materials, labor, subcontracts, and overhead should be easily identifiable.
Asset and Liability Accounts: These should track things like tools, vehicles, and loans accurately.

Check that your bookkeeper has categorized all transactions correctly within these accounts.

2. Run Financial Reports Regularly

QuickBooks Online allows you to generate various financial reports, which can give you insights into your business’s financial health. The most important reports to check include:

Profit & Loss (P&L) Statement: This will show you how much revenue you’ve earned versus your expenses, giving you a snapshot of your business's profitability.
Balance Sheet: This report displays the overall health of your business by showing your assets, liabilities, and equity.
Job Costing Reports: In construction, it's essential to track the costs associated with each project. Ensure your bookkeeper is using job costing effectively, which will allow you to track your profits and losses for each job.

Review these reports monthly to ensure accuracy.

3. Check for Proper Job Costing

For construction businesses, job costing is key. It helps you track the actual costs of each project and compare them to your estimates. Your bookkeeper should be assigning the correct expenses to the corresponding projects in QuickBooks.

Make sure that labor, materials, and subcontractor costs are being properly allocated to each job.
Verify that change orders are being accounted for correctly and that any discrepancies are noted in the reports.

4. Verify Vendor and Customer Transactions

In construction, you deal with many vendors and customers, so it’s important that your bookkeeper correctly records each transaction.

Customer Invoices: Ensure that all invoices are properly entered, and payments are matched with the corresponding invoices.
Vendor Bills: Check that bills from vendors (e.g., suppliers, subcontractors) are entered and paid in a timely manner.
Payments and Deposits: Confirm that payments to vendors and deposits from customers are recorded accurately in QuickBooks Online.

5. Reconcile Your Accounts Regularly

Reconciliation is essential to ensuring the accuracy of your financial data. Your bookkeeper should reconcile all bank and credit card accounts monthly. This means comparing the transactions in QuickBooks to the statements from your bank or credit card provider to ensure they match.

Make sure the reconciliation process includes both income and expense accounts.
If discrepancies are found, investigate them promptly and resolve any issues.

6. Double-Check Payroll Entries

In construction, payroll can be complex due to varying labor rates, union dues, and taxes. Verify that your bookkeeper is processing payroll correctly:

Ensure that the right wages, benefits, and taxes are being calculated and reported accurately.
Make sure that employee and contractor payments are classified correctly for tax purposes.

7. Monitor Compliance with Tax Regulations

Your bookkeeper should be keeping track of all relevant taxes, such as sales tax, payroll tax, and materials tax. Make sure they are:

Correctly tracking sales tax on applicable transactions.
Ensuring that payroll taxes are withheld and reported on time.
Handling 1099 contractors and ensuring all the necessary forms are filed.

Regularly check that these taxes are accounted for properly and that no deadlines are missed.

8. Ask for Regular Updates and Be Involved

One of the best ways to ensure your bookkeeper is staying on top of things is to maintain open communication. Request regular updates or monthly meetings where your bookkeeper can walk you through your financials. During these meetings, ask questions about anything you don’t understand and make sure they’re staying on top of industry-specific regulations, including tax law changes and job costing best practices.

9. Leverage QuickBooks Online Features

QuickBooks Online offers several built-in features that can help you check the accuracy of your bookkeeper’s work, such as:

Audit Log: This log allows you to see a history of all changes made in QuickBooks, including who made the change and when. This can help you identify any errors or inconsistencies.
Custom Dashboards: Set up personalized dashboards to track your financial metrics at a glance, so you can quickly identify issues like overspending on materials or missed revenue opportunities.

Check The Work Of Your Bookkeeper - Conclusion

While your bookkeeper plays a crucial role in maintaining the financial health of your construction business, it’s essential to periodically check their work. By regularly reviewing financial reports, monitoring job costing, reconciling accounts, and staying engaged with your bookkeeper, you can ensure that your finances are in good shape. QuickBooks Online can be a powerful tool for tracking these details, so make sure you’re leveraging its full potential for accuracy and transparency in your financials.