The unexpected pool of water beside the footpath would get you thinking. Just like the way we approach a bookkeeping job for a new client: Opening up the data file, and looking through various reports, you start asking a few questions: How come those figures are there? What’s happening with the allocations of funds? When was the last reconciliation undertaken?
There was definitely water flowing, but what was the source of the water? Was there a leak somewhere? Why was it here? Was it fresh water?
We start digging around, removing piles of mud, some stones and rocks, and dig deeper. There’s a lemon soda bottle, which we pull out of the ground and uncover a flood of gushing water. Panic! Stuffing the bottle back in the hole, we scramble to turn off the mains water supply!!
How much time and money can you save?
Why a Lemon Soda Bottle?
A lemon soda bottle to plug a leaking pipe!! Taking stock of the discovery, we’re surrounded by an ever rising pile of dirt and ever deepening pool of water. Obviously someone at some stage was aware of the leak, and rather than trying to fix it, they used a “plug” to (literally) bury the problem. This pipe had been slowly leaking for at least three years!!
Maybe the client thought that they were saving money by using an inexperienced bookkeeper
How Does Lemon Soda Relate to Book Keeping?
Often clients will contact us to sort out their bookkeeping. They may have been doing it themselves, or perhaps they were outsourcing a bookkeeper who didn’t necessarily comprehend the full extent of services required by the client. Maybe the client thought that they were saving money by using an inexperienced bookkeeper so the accounts have been attended to with a bandage solution, plugging a leaking hole with a lemon soda bottle.
As bookkeepers, we understand the need to be constantly undertaking detective work for our clients. What may appear to be a slight discrepency on the surface, may infact reveal a financial leakage that has been buried in the bookwork for a longtime and gone unnoticed.
A while back we were asked to tackle the books of an independant retail store. The owner was getting behind in the bookkeeping, and totally focused on the everyday functions of running the store. After a couple of weeks of working through the paperwork, the data entries, and making necessary adjustments to the allocations in their accounting package, we began to notice a leak in the finances.
Payments being made at the till were not ending up in the bank account. The owner knew she was struggling financially but was totally unaware of the source of the problem. What transpired was that one of the staff was helping themselves to the takings each week as a way to supplement their income.
$1000 was going missing each week
How long had the leak been present at the store?
We couldn’t answer that based on the documentation. However we were able to ascertain that about one thousand dollars was going missing each week! What’s worse, is that the “loyal” staff member had been employed by the store for the last twelve years!
Was the client glad thay they had asked us to do the bookkeeping?
A mixed response: one of dissappointment that the staff member could behave in such a manner. Relief that we found the leaking finances, and gratitude that we were able to offer more than just “Bookkeeping“.
Next time you think you are paying too much for a bookkeeper, maybe have a look to see exactly how much time and money they are saving you. Have a lemon soda while you contemplate your book keeping!
Next BAS due
