1. Are all of your client costs assigned to a client? Can you run a simple report
and check this? Is the report automatically emailed to you each Monday?
Run a report from QuickBooks for a client where you know you have costs and it has not settled yet. Pull the file and add up all of the cost in the file.
Do they match?
Do this for four or five clients.
2. Look at the balance in your IOLTA account. Look at the trust account liability
account in QuickBooks. Do they match? You need to know whose money is
in your trust account.
3. When is the last time you either reconciled your bank accounts, especially
IOLTA, or received a reconciliation report from your bookkeeper? If this isn’t
done there always seems to be a problem.
This is the only way you know if all transactions have been recorded.
4. Fraud and embezzlement is a problem we see often. While there are
procedures to follow and separation of duties if possible, there is one
procedure that has to be done by the owner.
“The eyeball test”
Pull the last three months bank statements.
Pull the images from the last three months bank statements.
Check and see if you have an image for each check.
Look at the payee, signature, etc. Does everything look ok?
Your bookkeeper and employees need to know that you do this periodically.
5. We all outsource payroll. I recommend ADP, but QuickBooks, Paychex and
several others are also fine. When you use a service, be careful as to who
authorizes payroll and payroll changes. Really important since we electronic
draft most payroll these days.
Look at the report for each payroll and check the employee name, pay rates, etc.
I have seen an employee give him or herself a raise. Don’t just look at the debit in your bank when you look at your account. The details are important.