1. Can you handle customer invoicing?
It goes without saying that the job of a book keeper contains a lot of customer invoicing. In fact, customer invoicing is one of the most basic of a book keeper’s key responsibility areas. Therefore, when asked this question, you should clarify your comfort levels at customer invoicing. This is one of those basic questions that work in creating the path for the further questions.
2. How does the customer invoicing relate to the accounts receivable?
This is another of the basic questions that are asked to a standard book keeper. Though even a layman can glib an answer to this one, only the well educated and qualified book keeper can give a stable and authentic answer to this question. So, make sure that you do your homework well before you opt for a bookmaker’s interview.
3. What is an Asset? What is a Liability?
This is another question that aims at finding out whether you slept through your accountancy class or did you actually learn something. An asset and liability are terms that form the base of the world of accountancy.
4. Briefly define a journal entry.
Again, this is a basic question that can be asked to a standard book keeper. These questions are generally aimed at finding out your knowledge and capabilities. Good news is that the answers to questions like this will be a reflex if you have actually paid attention in accountancy class and were serious in your studies.
5. Experience and educational qualifications
The further questions for a standard book keeper will involve finding out about their experience in the profession. If the book keeper is a novice, his or her educational qualifications will be gone through and authenticated before the interview goes anywhere ahead.
6. Tell us something about your long term goals?
I want to secure a long term position of a bookkeeper in a dynamic organization where I can utilize my ten years experience in the accounting field and special skills in maintaining records, preparing financial statements and calculating errors for the benefit and growth of the enterprise.
7. What is the difference between liability and asset?
Liability and asset are two completely different things but without them it is impossible to successfully run a company. Assets are generally things that add value to the reputation to the company. There can be fixed assets like land, building, and current assets like stock, cash, debtors, inventory and bill receivable. Intangible assets can also be included like goodwill and patients. Liability is something that the company owes to other people, and it includes bill payable, bank loans and creditors.
8. Out of the other candidates that we have interviewed why should we choose you among the rest?
This is the most common question that is asked almost in every interview. While answering this question you need to think and answer it briefly, try to give a description of your skills and achievements to the employers. Be very positive and try to explain them how your back ground qualification really matches with the bookkeeping job description. You can also state your extensive experience in this field.
9. How can you help in the growth and progress of the company?
This question you need to answer to the point. Keeping in mind your job description, tell the employer how you can prove to be a benefit for their company. If you have had soft ware education and training then you can also include this in your answer.
10. Explain the difference between a profit and loss statement and the balance sheet?
A profit and loss statement is prepared from time to time for a specific period may be a month or a week; it is usually prepared to find out the actual profit and loss of the company. A balance sheet is always prepared at the end of the financial year and it is made to find out the true position of the company’s assets and liabilities.
11. Do you think accrual or cash basis reporting is better for business management?
Look for an advanced bookkeeper to explain that accrual basis accounting provides better financial reports, but cash basis is usually preferred for taxes. We can keep the books on accrual basis for management reporting and the tax accountant can make adjustments for cash basis taxes. A standard bookkeeper will probably tell you what her experience has been and will not have a preference for either.
12. What is the accounting equation (or the balance sheet equation) or explain the balance sheet.
A good bookkeeper will explain the balance sheet has assets, liabilities and equity. This is mandatory for anyone you expect to provide accurate financial reports. Ideally they will tell you the equation is: Assets = Liabilities + Equity. If they can't explain the balance sheet, then ask them to describe an asset and liability account. You won't want someone who doesn't know the balance sheet responsible for month end close, but if someone else is ensuring accuracy, just knowing how assets and liabilities are used will be fine.
13. The bank account is off $0.72. How long will you spend looking for the problem and what steps will you take to find it?
This problem is tricky and really depends on what you would like to see in the right bookkeeper. Some won't stop looking until they find it. Sure, there could be numerous things causing any discrepancy so you do want them to spend some time looking for the problem. But how much time? Is spending 2 hours looking for $.72 the best use of time? If we look at return on investment, that's absolutely a bad use of time. If they answer 2 hours, you'll want investigate their tolerance for non-perfect circumstances. If you're in the creative field, an extreme perfectionist may just drive you insane. If, however, they won't look for the error at all, their attention to detail probably isn't strong enough and you should keep looking.
When looking for the error, the ideal candidate will say it's likely a transposition error and they would start there first (transposition errors are divisible by 9). They may just say they would check every line item against the statement, which is perfectly valid.
14. In cash basis accounting, how would your record a $600 annual insurance premium?
The right answer for cash basis is debit insurance expense $600, credit cash or accounts payable. All bookkeepers should get this right.
15. How would you record a $600 annual insurance premium using accrual accounting?
The correct answer here is Debit Prepaid Insurance $600, Credit Cash or Accounts Payable. Prod them to find out when insurance expense is recognized. It should be $50/month with a Debit to Insurance Expense and a Credit to Prepaid Insurance. If the candidate cannot answer this question, don't expect them to keep your books based on an accrual accounting. You will want to depend on someone else for management reports.
16. How many gas stations (or coffee shops, etc) do you think there are in the U.S.?
With this question, we're looking for good critical thinking skills. It's not okay to just guess a number with no explanation or to say they would "google" it. You want the candidate to have a process for getting to their guess, no matter how far off it is. There are this many gas stations in my town, I would guess this many towns in my state....
17. Rank the following in order of importance for business success: Sales, Teamwork, Quality, Integrity, Profitability, Service
There isn't a right or wrong answer to this question, but it will indicate whether the candidate is aligned with your business culture and also demonstrate critical thinking skills. Look for a justification for why they answered the way they did. Does it line up with how you would answer the question? For example, if they say Profitability is the most important. Why is that the case? If they say teamwork is least important, you probably want to dig a little deeper if teamwork is high on your priority list.
A bookkeeper would preferably list profitability lower on the list because you want to know that they are considering the whole business, not just their job. You would also want to see integrity high on the list. Do you really want a bookkeeper who doesn't value integrity?
18. Tell me about a time you didn't agree with something your boss asked you to do.
The right answer here will depend upon the personality you're seeking. Do you want a follower who will do what you say? Are you looking for an advisor to tell you what should be done? Perhaps a mix is the right answer for you, someone who is confident enough to speak their mind, but is willing to take direction.
There are tons of potential interview questions to ask when interviewing bookkeepers. The ones listed above can give you a good indication of whether or not the candidate is a good fit. For a better assessment of accounting skill, checkout AIPB's bookkeeper test. Don't forget to check references and try to talk to a CPA who has had the opportunity to see their work.
19. Define Basic Bookkeeping Terms
This is a question you can use to quickly assess the candidate's understanding of basic bookkeeping. You can remove the people from the interview process that have added misleading information to their resumes with this kind of question. You can either ask the candidate to point out some key terms, or you can list key terms and ask the candidate to properly define them. Or use terms in other questions to see if they understand them.
20. What kinds of financial filings have you done in the past?
If you are a corporation looking for a bookkeeper, then you will want someone with experience in filing Securities and Exchange Commission forms as well as the many other financial filings that corporations do. You may be interviewing a bookkeeper that does not have experience in filing company tax forms on any level. Have a comprehensive list of the financial forms you will need your bookkeeper to file, and match the candidate's experience with your needs.
21. How extensive have your past financial reports been?
If you have a staff of 100 people with six departments, then you will want a bookkeeper that is experienced in juggling reports for that size company. Find out from the candidate how familiar she is with creating various kinds of management and executive reports, and see if her experience matches the kind of reporting data you will need on a regular basis.
22. What are your educational goals?
A bookkeeper that has no desire to advance his education will not be able to keep up with the annual changes to tax codes and the advances in accounting software. Hire a proactive bookkeeper that understands the value of ongoing education and knows how to keep current on changes.
23. What is the difference between liability and asset?
Liability and asset are two completely different things but without them it is impossible to successfully run a company. Assets are generally things that add value to the reputation to the company. There can be fixed assets like land, building, and current assets like stock, cash, debtors, inventory and bill receivable. Intangible assets can also be included like goodwill and patients. Liability is something that the company owes to other people, and it includes bill payable, bank loans and creditors.
24. Out of the other candidates that we have interviewed why should we choose you among the rest?
This is the most common question that is asked almost in every interview. While answering this question you need to think and answer it briefly, try to give a description of your skills and achievements to the employers. Be very positive and try to explain them how your back ground qualification really matches with the bookkeeping job description. You can also state your extensive experience in this field.
25. How can you help in the growth and progress of the company?
This question you need to answer to the point. Keeping in mind your job description, tell the employer how you can prove to be a benefit for their company. If you have had soft ware education and training then you can also include this in your answer.
26. Explain the difference between a profit and loss statement and the balance sheet?
A profit and loss statement is prepared from time to time for a specific period maybe a month or a week; it is usually prepared to find out the actual profit and loss of the company. A balance sheet is always prepared at the end of the financial year and it is made to find out the true position of the company’s assets and liabilities.
