Taking over books from another bookkeeper starts with a handover request: accounting file access, statements, reconciliations and the client's rules. Next, test the last close against the bank statements before you post anything new. Only then decide which inherited rules to keep and which to rewrite, beginning with those touching the largest amounts.
What should you request when taking over books from another bookkeeper?
When taking over books from another bookkeeper, request access to the accounting file, the last twelve months of bank and card statements, every reconciliation report for that period, the list of open items and the client's standing rules. The client usually controls most of this, so make the request through them and in writing.
The handover request checklist
Send this list to the client, who can pass it to the previous bookkeeper or answer it directly.
- Admin or accountant access to the accounting file, transferred to you, not shared on someone else's login.
- Bank and card statements for every account for the last twelve months, as the bank's PDFs.
- Reconciliation reports for each account for the same period.
- The date of the last closed month and whether it was locked.
- A list of open items: suspense balances, unanswered client questions, known errors.
- Categorization rules or bank rules, exported or as a list.
- Any recurring adjusting entries, such as depreciation or loan interest, with their schedules.
- Payroll and sales tax filing details: who files, how often and where the reports are.
- The contact for the client's tax preparer.
- Loan, lease and fixed asset documents behind balance sheet figures.
Access, not attachments
Ask for access to be transferred, not files emailed. A shared login leaves the previous bookkeeper with continuing access and leaves no trace of who changed what. Have the client remove the old access once yours is in place.
Books kept in a spreadsheet
Some handovers arrive as a workbook rather than an accounting file. The checklist still applies, but add a request for the workbook's formulas and any linked files. Free accounting software in Excel covers how to test a client workbook and when to move the books into software.
Testing the previous bookkeeper's last close against bank statements
Testing the last close means proving, from statements and not from the inherited reports, that each account's book balance matches the bank at the last closed month end. A previous bookkeeper's reconciliation may be right, but you are about to build on it, so check it yourself first. It takes little time and protects every month you post afterward.
A worked test
The figures are an example. The previous bookkeeper says March is the last closed month.
| Account | Book balance at March 31 | Statement closing balance | Difference |
|---|---|---|---|
| Business checking 4417 | 31,206.55 | 31,206.55 | 0.00 |
| Savings 0082 | 12,000.00 | 12,014.20 | -14.20 |
| Card 0921 | -3,130.10 | -2,480.10 | -650.00 |
Checking ties. Savings is short by 14.20, which looks like the interest line for the quarter that was never posted. The card is off by 650.00, the size of a single card payment. On inspection, the payment was recorded on the checking side but never matched against the card account, so the card still shows that debt. Both are fixable before your first close, and both would have rolled into your months if you had started posting on top of them.
Go back one more month
When the last month fails, test the month before it. Keep going back until you find a month that ties on every account. That is your real starting point. Report the finding to the client before you fix it, so it is clear the problem came with the file.
Converting statements for the test
The test needs the statements as data, not only PDFs. AutoBankConvert converts a year of a client's statements in one batch and checks each one's opening balance, transactions and closing balance, so the bank side of the test comes from statements proven complete.
Inherited open items: suspense balances, old outstanding checks and unanswered questions
Inherited open items are the loose ends the previous bookkeeper left: balances in suspense or uncategorized accounts, checks outstanding for months, and questions the client never answered. Each one is a small debt. List them all in the first week, decide who owns each and set a date to clear them.
Suspense and uncategorized balances
Open the transactions behind each balance. Some will be obvious and can be coded in minutes. Others will need the client. Group the client questions into one message, with dates and amounts, rather than sending them one at a time.
Old outstanding checks
A check that has been outstanding for many months may have been lost, voided or never sent. Ask the client. If it was voided, reverse it. If it is still owed, the payee may need to be contacted. Do not leave it in the reconciliation indefinitely.
Questions with no answer
The previous bookkeeper may have asked the client things that never got a reply. Ask again, briefly, and say you are the new bookkeeper. Clients often answer a new person faster than one they have stopped hearing.
Which inherited categorization rules to keep and which to rewrite first?
Inherited categorization rules should be kept when they code a vendor consistently to the right account, and rewritten when they are too broad, contradict each other or code large amounts to accounts the client does not use. Rewrite the rules touching the most money first, since an error there changes the reports the most.
How to review them
List each rule with the payee it matches and the account it assigns. Then compare against a few months of actual coding. Look for:
- Rules that match on a word so general it catches unrelated payees.
- Two rules that send the same vendor to different accounts.
- Rules assigning accounts that were merged or renamed.
- Large recurring vendors with no rule at all, coded by hand each month.
Keep the client's history
A rule should reflect how this client's books have been coded, unless that coding was wrong. Changing a vendor's account from one month to the next makes the profit and loss swing for no reason. When you do change one, recode the history for the current year so the year reads consistently.
How should the first month after a bookkeeper handover run?
The first month after a bookkeeper handover should run as a slow, fully checked close: every statement converted and balanced, every line reviewed rather than trusted to rules, and every reconciliation built fresh. It takes longer than a normal month. That extra time buys you confidence in every later one.
Steps for the first close
- Start from the tested last closed month.
- Convert and reconcile each account's statement for the new month.
- Review every line, including those the inherited rules coded.
- Clear or carry each inherited open item.
- Send the client one message with questions from the month and the handover.
- Review the reports against the prior months for unexplained swings.
Settle into a rhythm
After the first close, switch to the routine you use for other clients. If the client has enough activity, a weekly bookkeeping routine for client books keeps the new file from slipping back into the state it arrived in. If the handover falls near a quarter end, run the quarter end bookkeeping checklist as part of your first close, since filings may depend on months you did not prepare.
A handover when the previous bookkeeper does not cooperate
When the previous bookkeeper does not cooperate, rebuild what you need from the client and the bank. The client owns the accounting file and the bank records, so access can usually be transferred without the old bookkeeper's help. What you lose is their notes, which you replace by testing everything yourself.
What you can get without them
- The accounting file, through the client's own admin login.
- Statements, from the client's online banking or a request to the bank.
- Payroll and tax filings, from the providers and agencies the client uses.
What you cannot get
Undocumented reasons for adjusting entries, private notes and unsent questions are gone. For each adjustment you cannot explain, ask the client and their tax preparer. If no one knows, flag it and leave it unchanged until someone does, rather than reversing a figure that may have been right.
Client expectations after a bookkeeper takeover
Client expectations after a takeover should be set in the first week. Tell the client what you found in the test of the last close, what you are fixing, how long the first close will take and what you will need from them. A client who hears the plan early is patient with the slower first month.
What to tell them
Keep it short and concrete: which accounts tied, which did not and by how much, what the fixes are, and the date of your first finished close. Avoid blaming the previous bookkeeper. Describe the issues as facts in the file.
Ask after the first quarter
After a few closes, ask the client how the change is going. A short bookkeeping client feedback survey gives them an easy way to say what is working and what is not. When the next handover comes in, AutoBankConvert can take the year of statements for the test and the first close in one upload.