Questions That Your Accountant Should Be Asking You - Accounting System

Small businesses rely on their Accountants to do their taxes and sometimes their bookkeeping. However, if that is all Accountants are doing for their clients, then I believe that the Accountants are doing the client a disservice.

In a series of blog posts, I will be listing out questions that I believe Accountants should be asking their clients in order for the client to be able to anticipate threats to and opportunities for their business.

In this blog, I will be asking the following questions about the Accounting Software:

1. Is your Accounting Data backed up?

When you stop and think about it, if you were to lose your Accounting data, you would have a very difficult time remaining in business. After all, off the top of your head, would you know who owes you money and how much?  Would you know which vendors you owe money to?  Would you know how much money you owe your employees and how much taxes you owe?

Thus, I think you can see how critical your Accounting data is to your business. After all, you can always reinstall your Accounting software, but if you lose your data, you could be out of business.

2. Is your Accounting Data backed up Offline?

Some clients tell me that they back up their data to a jump drive or to an external hard drive or Server that is in their office, so they think that they are safe.

However, jump drives can get lost, stolen or simply fail to work. On site Servers can be damaged by fires, floods, or earthquakes. If you have a break in, Servers can be stolen.

The reality is that if you don't have your data backed up to an online Server, you truly are not safe and your business can easily be put at risk.


Small businesses rely on their Accountants to do their taxes and sometimes their bookkeeping. However, if that is all Accountants are doing for their clients, then I believe that the Accountants are doing the client a disservice.

In a series of blog posts, I will be listing out questions that I believe Accountants should be asking their clients in order for the client to be able to anticipate threats to and opportunities for their business.

In this blog, I will be asking the following questions about the Accounting Software:

1. Is your Accounting Data backed up?

When you stop and think about it, if you were to lose your Accounting data, you would have a very difficult time remaining in business. After all, off the top of your head, would you know who owes you money and how much? Would you know which vendors you owe money to? Would you know how much money you owe your employees and how much taxes you owe?

Thus, I think you can see how critical your Accounting data is to your business. After all, you can always reinstall your Accounting software, but if you lose your data, you could be out of business.

2. Is your Accounting Data backed up Offline?

Some clients tell me that they back up their data to a jump drive or to an external hard drive or Server that is in their office, so they think that they are safe.

However, jump drives can get lost, stolen or simply fail to work. On site Servers can be damaged by fires, floods, or earthquakes. If you have a break in, Servers can be stolen.

The reality is that if you don't have your data backed up to an online Server, you truly are not safe and your business can easily be put at risk.
I recommend online backups such as the one that is integrated with QuickBooks. Most business can only pay $4.95 for that QB Online Backup. You can also  use services such as Carbonite or Mozy for online backup.

To be really safe, you can backup to both a jump drive and online Server.

3. Do you have sensitive data such as Social Security numbers or credit card numbers stored in your Accounting software?

 If so, you need to be really careful. If someone were to hack or steal that information, you could easily be put out of business. Can you say Identity Theft?

I tell my clients that as much as possible, you should try to keep that information off you computer.
This is especially true for credit card information. For example, I use Intuit Merchant Services so that when I send a bill to client, they can go online and pay with a credit card. The information is stored on Intuit's computers, not mine.

If you store credit card information on your computer, you need to be aware of PCI compliance.
PCI compliance is not my area of expertise, but needless to say, there are severe penalties for not being in compliance.

For more information, please go to the following link:
http://www.smallbusinesscomputing.com/buyersguide/a-small-business-guide-to-pci-compliance.html

As your trusted business advisor, your Accountant should be making you aware of these kind of Accounting system issues.  What you don't know can easily put you out of business.