Competency Based Interview Questions For Bookkeeper

Operational And Situational Questions

• Talk about your previous work experience as a bookkeeper.
• What have you done recently to become a better bookkeeper?
• How do you stay updated on regulatory changes that impact on your work?
• What sort of financial reports were you responsible for preparing?
• Which bookkeeping systems are you familiar with?
• How would you rate your computer skills?
• As a bookkeeper, how do you avoid errors in your work?
• Explain the balance sheet equation.
• The ledger is off by $0.80. What process would you use to find the error?
• How would you record an insurance premium using the accrual accounting method versus the cost accounting method?
• What process would you use to prepare and process invoices?
• How have you contributed to cost savings or profits in your department?
• How often did you interact with vendors and clients?
• Have you faced any ethical dilemmas in your work? How did you handle it?
• Recall a time you worked with your team to complete a complex project under a deadline.

Top 3 For Qualified Accountants

Question : ‘what Do You Do If A Bank Reconciliation Is Off By A Very Small Amount’

This is another technical expertise bookkeeper interview question, and it can also be one of the trickiest for your candidates to answer.

Heres why: Often, bookkeepers are instructed to simply plug discrepancies into a miscellaneous expense account. The thinking behind this is you dont want to waste time looking for immaterial amounts. If your bookkeeping candidate answers this way, dig a little deeper by reassuring them that youre not overly concerned with the time they would spend working on a bank reconciliation bottom line, you just want them to catch any errors.

This should lead your bookkeeping candidate to give an answer that demonstrates zero tolerance for discrepancies in the bank reconciliation. If there is a discrepancy, it can be found. Period.

A seemingly small discrepancy can actually represent more than one missing transaction. For example, a $100 discrepancy could represent a clerical error in entering a deposit amount or it could be caused by a missing deposit for $10,000 and a missing check for $9,900. The net difference would still only be $100, but the absolute value of the misstatements on the books would be nearly $20,000.

Taking this a step further, these misstatements could result in collection activity against a customer who has actually paid or double-paying a bill. The first could result in the loss of the customer, and the second could have a significant negative impact on your businesss cash flow.

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List Of Commonly Asked Accounting Interview Questions:

#1 Walk me through the three financial statements.

The balance sheet shows a companys assets, liabilities, and shareholders equity. The income statement outlines the companys revenues and expenses. The cash flow statement shows the cash flows from operating, investing, and financing activities.

#2 If I had only one statement and wanted to review the overall health of a company, which statement would I use and why?

Cash is king. The cash flow statement gives a true picture of how much cash the company is generating. That being said, its important to note that all three statements truly are required to get a full picture of the health of a company. Learn more about how the three financial statements are linked.

#3 What happens on the income statement if inventory goes up by $10?

Nothing. This is a trick question. The only impact will be on the balance sheet and cash flow statement.

#4 What is working capital?

Working capital is typically defined as current assets less current liabilities. In banking, working capital is normally defined more narrowly as current assets less current liabilities .

#5 What does having negative working capital mean?

#6 If cash collected from customers is not yet recorded as revenue, what happens to it?

It usually goes into Deferred Revenue on the balance sheet as a liability if the revenue has not been earned yet.

#7 Whats the difference between deferred revenue and accounts receivable?

#9 Under what circumstances does goodwill increase?

How Would You Record A $1200 Annual Insurance Policy Premium Using The Accrual Method

This type of question allows the interviewer to get an idea of how you process financial information for an organization. Describe your process for using the accrual method and give examples of how this can apply to effective bookkeeping for their company. Use the following example to practice your response:

Example:”I would record the $1,200 premium in the current assets account as a prepaid expense. Since insurance companies usually require six months’ payment in advance, my monthly balance sheets will show this as a $100 per month payment from accounts payable.”

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Can You Explain The Benefits Of Both Cash Basis And Accrual Reporting

Two main methods of reporting are used in business, and showing that you understand them will highlight your proficiency as a bookkeeper.

Example Answer:

Cash basis is more ideal for tax accountants because it is more simple. Accrual basis is the best method for bookkeepers to get a clear financial picture to then report to management.

How Do You Keep Your Clients’ Financial Information Private

The aim of this question is to assess the candidate’s ability to work with sensitive information and keep it private. What to look for in an answer:

• Experience working with sensitive information
• Ability to keep client information private
• Good ideas for upholding privacy laws

Example:

“To keep clients’ financial information private, I always work in a secluded space. This ensures no one can look over my shoulder at my files or computer or overhear conversations I have with my clients. Any physical files I have won’t leave my locked filing cabinet at work and my electronic files are password protected.”

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How Do You Stay Motivated In Your Work

The interviewer wants to know your interests and values. Demonstrate your personal interests and values that help you perform well in your roles.

Sample Answer

I am passionate about explaining accounting to accounting to non-mathematically minded people, putting it into practical, down-to-earth terms they can comprehend. I love helping people understand things better.

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Tell Me About A Time When You Received Difficult Feedback How Did You React

One of the most difficult things to dispense and receive is critique of work. Anyone who has spent enough time in this industry realizes that human error is part of the job, and no one is perfect. Here, the important thing to do is let your interviewer know how you overcame this particular challenge. How accountable were the parties involved? Your ability to navigate though difficult situations will place you high on just about any accounting employers list.

Answer Sample:

No one likes these situations, but Ive found that dealing with it factually and without predjudice tends to be the best approach

Describe A Time When You Had To Persuade A Coworker Or Manager

During your career, you may need to explain your opinion or suggestion to a team member or customer. This question is seeking an example of your communication skills. Try to form a thorough response that demonstrates your ability to listen actively, form a solution and convince others of your suggestion. Consider a time you persuaded others to follow your lead or idea.

Example:I was previously an event co-ordinator. I maintained regular communication with clients and my colleagues. There was a disagreement between a customer and my manager over when an event should start. Through multiple conversations in person, via email and through video conferencing, I was able to persuade them to agree on my idea of starting the event later than usual. This would give everyone time to get there after work, but not too late that the guests would be tired. They appreciated my experience in event management and how I confidently explained my reasoning to them.

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What Is Your Dream Job

What are you assessing?

Ambition, whether the candidate will be a good long-term fit.

How do you handle this question?

This is a great question to ask younger candidates or graduates to get an understanding of their interests and goals, and whether they really are likely to remain at your firm long-term. Their dream role most likely will not be the job they are interviewing for , but if they really want to be a policeman, then they probably will not be the best candidate to hire.

If You Could Invite Three People Dead Or Alive To Dinner Who Would They Be And Why

What are you assessing?

Personality, ability to think quickly.

How do you handle this question?

This question will give you an insight into their interests and passions, and as a bonus, will help you assess how well they can think on their feet. This is a good question to ask early in an interviewit can help a candidate relax and allow you to find some common ground.

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What Are Days Payable Outstanding And What Is Indicated When Days Outstanding Grows

How to Answer

This question gauges whether you understand metrics and can use them to catch trends in the business. Days Payable Outstanding is a metric that measures the health of accounts payable. A high or growing metric indicates that you can pay your vendors on increasingly favorable terms, which is beneficial to cash flow management.

Written by Brian Schuchart on December 20th, 2020

Entry Level Example

Days payable outstanding computes the average number of days a company needs to pay its bills and obligations.Companies that have a high DPO can delay making payments and use the available cash for short-term investments as well as to increase their working capital and free cash flow. However, higher values of DPO, though desirable, may not always be a positive for the business as it may signal a cash shortfall and inability to pay.

Written by Tabatha Lee on October 31st, 2022

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Share With Us Your Greatest Achievement

This question helps your interviewer to know what you refer to as a success. Share what you are proudest of in your recent job.

Sample Answer

The biggest achievement was when I was able to convince the bank to integrate their system with our bookkeeping software. This enabled the transactions which we used to enter manually in the systems to begin reflecting automatically in our systems. It not only made it easier for the transaction to be entered in the proper accounts but also be classified correctly.

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Describe A Time Where You Explained A Complex Issue To Someone With Without An Accounting Background

Your ability to communicate with people who are not accountants may be very important, especially if you will be in an advisory role with direct contact with clients or with team members from other departments. For this reason, you should emphasise your communication skills and storytelling talent, as well as your ability to work as a part of a team.

Which Accounting Software Packages Are You Comfortable Using

Employers ask this to gauge your familiarity with the various software programs available, especially ones youâd be using in the role youâre applying to fill.

Prepare your answer by reflecting on your experience with programs and how youâve found them to be useful in your previous accounting roles. In addition, research programs that you may not have experience with and prepare to discuss the range of possibilities for the role.

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Question : ‘what Do You Love About My Industry’

This bookkeeper interview question is an important one to ask, since bookkeeping tasks can vary by industry. Some small-business owners might be able to get away with hiring a qualified bookkeeper with general knowledge, but others like construction companies, law firms and nonprofits need a bookkeeper with industry-specific knowledge.

Dont let your bookkeeping candidates lack of experience in your industry deter you from making an offer of employment, though. If they are otherwise a fit for your business, and have a love for or interest in your industry, they might still be the best person for the position.

What Accounting Software Systems Or Apps Have You Used In The Past

What are you assessing?

System and technology skills.

How do you handle this question?

This is not a trick questionyou want a list of all the systems your candidate has experience with, with detail on their level of expertise if relevant. If a candidate has used some of the apps in your firms stack, it will be extremely advantageous, saving you time in their onboarding process and ensuring they are performing value-adding tasks sooner. Not only this, but many technology skills are transferable, and if they can demonstrate skills using systems similar to yours, they will likely pick up your technology more easily.

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What Kind Of Strategies And Mindsets Is Required For This Role

The interviewer wants to understand your attitude as you perform the job. Showcase the values you regard as important as far as this job is concerned.

Sample Answer

A skilled bookkeeper needs to have a great sense of accuracy. Wrong data can mislead the whole financial statement hence resulting in the downfall of the entire company. Time and effort are also crucial aspects of maintaining up-to-date records of the book. A good bookkeeper must be hard working and know how to work under pressure.

Question : ‘what Are Your Personal Interests / What Are You Passionate About In Your Personal Life’

This last question gauges the candidates fit with your existing company culture.

Although you want your bookkeeper along with the rest of your team to be committed to your company and the work they do for you, you dont want to hire someone without any personal interests at all. Employees with a healthy work-life balance are happier, healthier and more mindful than workaholics. In turn, that results in higher-quality work when they are focused on the job.

A lack of personal interests can indicate that your candidate has a tendency toward being a workaholic. Or, its possible that the candidate is just telling you what they think you want to hear. Either way, dig deeper, and ask follow-up questions. If you get the impression that the candidate truly has no outside interests, though, you might be interviewing someone who will work themselves to the point of burnout and resentment.

Assuming your bookkeeping candidate does have personal interests and passions which is really the more likely scenario asking this bookkeeper interview question can help you in several ways:

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Accounting Clerk Qualifications To Look For

Accounting Clerks are administrative whizzes who support the accounting department by performing a variety of tasks.

Tasks vary depending on the company, but they often include:

• Reconciling bank statements
• Maintaining accounting databases
• Keeping accurate document records

A well-qualified candidate will have all the right certifications to bolster their bookkeeping duties, though they may not have a ton of experience since this is an entry-level gig.

Your top accounting clerks will be detail-oriented and thrive in an organized work environment.

Interview Questions To Break The Ice With Bookkeeper Candidates

Regardless of whether you are interviewing an entry-level candidate or an experienced professional, the interviewing process can be intimidating for your bookkeeper interviewees and stressful for you.

To settle everyone’s nerves, you can start the interview with soft, icebreaker questions. You can ask general, open-ended questions such as the following:

• Please tell me about yourself.
• Why did you apply for this bookkeeping position?
• Why did you choose this career?
• Why are you interested in leaving your current job?
• What goals do you have in your career? How do you plan to achieve them?
• What do you see yourself doing five or 10 years from now?

These types of questions will not give you insights into whether or not your candidate is a good choice for the position. But you may learn something important about your candidate through these open-ended questions, and it will give a chance for any nervousness or anxiety to settle down.

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Describe A Time In Your Previous Employment When A Situation Called For Creativity And How You Went About Handling It

Being able to think creatively is an important component of critical thinking and problem-solving skills, both of which are desired competency skills when it comes to employment. This question enables employers to understand how well you use your creativity to solve problems in the workplace. When answering this question, choose a specific instance of when you were required to use your creativity to solve a problem and the specific results that your solution brought about.

Example:”In my previous job, we received a project request that we had never dealt with before. My team and I were unsure how to proceed in completing this project, and as a result, had to come up with a new way to do things than what we had done for previous projects. To determine how to proceed, I interviewed other project managers within my organization that had dealt with similar projects.

Using this information, I devised a new task tracking system specific to the project that would allow my team members to track their tasks and leave comments when they were unsure of how to proceed. This new tracking system greatly increased my team’s productivity overall and allowed us to complete the project in a successful and timely manner.”

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Jenn, an Indeed Career Coach, breaks down the intentions behind employer’s questions and shares strategies for crafting strong responses.