As a former IOLTA auditor, I saw a large variety of skill levels in bookkeepers. People who call themselves bookkeepers are not all cut from the same cloth. There is no licensing requirement in our state for bookkeepers. Plus, not all bookkeepers understand that the rules of IOLTA record keeping are not the same as keeping the firm’s books. The IOLTA rules are a strict liability standard with many ethical rules worked into the record keeping requirements. Every penny must be accounted for. Every month, the account must reconcile exactly, with no adjustments. Every month, the IOLTA check register must reconcile to the client ledgers to the penny — without any adjustments. There is no such thing as “close enough.”
When interviewing potential bookkeepers, ask whether they are familiar with the RPCs. Do they understand how to reconcile client ledgers? If they don’t know what client ledgers are, they may not be familiar with client trust account rules.
Another factor to keep in mind is the security of your records and information with the bookkeeper. Will they be on your computers to access financial records? If so, they could access client information, too? It’s worth getting a background check on anyone who will have this level of access to such confidential information.
Keep in mind what I now call the “Target factor.” Many of you may already know the Target data breach was caused by one of Target’s small third-party vendors that had insufficient computer security safeguards. Through this deficiency, hackers used the vendor as the pipeline to get at the bigger fruit: Target’s customers’ personal information. You don’t want to be that third-party vendor that causes a large problem, and you don’t want your bookkeeper to be that third-party vendor that causes you a large problem.
If your bookkeeper is accessing your data remotely, you have some additional security issues to consider. Once you let the bookkeeper into your computer, it creates a conduit for someone hacking into their computer to get into yours, too. Do you know whether your records are secure with your bookkeeper?
Bookkeeping is about competence, not personality. If you’re getting referrals, it isn’t about whether they are nice or pleasant; it’s about their expertise with IOLTA recordkeeping. Do your background check, get references, and ask the important questions about their training and experience. Don’t jeopardize your license over something that is completely within your control to do right.