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Bookkeeper Interview Questions
Every business, big or small, runs smoother when its books are in order. That's where a good bookkeeper comes in. They're the ones making sure the invoices get sent, the bills get paid, and every dollar is tracked the way it should be. Behind the scenes, they're turning piles of transactions into clean, reliable records that help owners and managers understand what's really going on with the money.
If you're interviewing for a bookkeeping role, expect questions that go beyond just software knowledge or data entry. Hiring managers want to know how you handle deadlines, spot errors, keep things organized, and communicate with the broader team. The 28 questions below will help you prepare, whether you're applying at a growing startup or an established company with a full finance department.
Bookkeeper Interview Questions
1. What is a general ledger account?
This is a technical question, meant to determine your qualifications as a bookkeeper. This type of question is normally asked early in an interview, after the general and opening questions and before the behavioral questions. The best way to answer a technical question is directly and concisely with little embellishment or other details.
Example Answer
"A general ledger account is a basic or fundamental account used for balance sheet and income statement entries. They are divided into asset accounts such as cash, accounts receivable, inventory, and equipment and liability accounts, including accounts payable, accrued expenses, and pre-paid deposits."
2. What is the difference between wages and salaries?
This is another technical question, but its intention is slightly different. An interviewer will ask this more detailed question to determine if you are familiar with the nuances of bookkeeping. It is also an indicator of the type of accounting system the organization uses which provides you with a clue as to how to answer it. You should answer with both a definition of the two terms as well as a statement about how you use this information when completing bookkeeping entries.
Example Answer
"Wages and salary are often used interchangeably in bookkeeping. However, you can make the distinction that wages are applied to non-exempt hourly employees and salary is used for exempt employees who work for a pre-determined fee which is not tied to the amount of time they spend on the job. Wages are calculated by multiplying the employee's hourly rate of pay by the number of hours they worked during the accounting period. The rate may be adjusted for overtime, holiday pay, and other time outside of the normal workday. Salary is calculated by dividing the employee's annual compensation by the accounting period which is typically a week, bi-weekly, or monthly."
3. Why is accumulated depreciation an asset account?
This is another example of a technical question. However, the interviewer will ask a "why" question to learn more about your understanding of the purpose of bookkeeping and accounting practices. Knowing the rationale behind a bookkeeping entry indicates that you will know how to enter a specific transaction and are capable of identifying bookkeeping issues and potential errors.
Example Answer
"Creating an asset account such as accumulated depreciation enables the organization to track both the original cost of the asset as well as its current value. This type of account is known as a contra account since it increases as the asset account decreases and is a credit account. It can also be used to reduce the organization's tax liability."
4. Why is depreciation on the income statement different from the depreciation on the balance sheet?
This is a follow-up technical question which the interviewer uses to confirm your knowledge and dig deeper into a specific topic. This can indicate that the organization may have had issues in this area. You can enhance your perceived qualifications for the job by providing a detailed answer to follow-up questions.
Example Answer
"The difference between depreciation reported on the income statement and depreciation on the balance sheet is based on time. Income statements report activity within a specific time period such as monthly, quarterly, or annually. Balance sheets are cumulative and extend beyond a specific reporting period. Depreciation on the income statement is typically a portion of the overall depreciation of the asset reported on the balance sheet."
5. What is the three-way match?
One of the key services bookkeepers provide is ensuring that organizations pay invoices on time, pay the correct amount, and don't pay fraudulent or duplicate invoices. An interviewer will ask this question to make sure you understand this and have a methodology to accurately pay invoices. This technical question will help establish your credibility and qualification for the position.
Example Answer
"When processing an invoice for payment, I use a three-way-match methodology to ensure the invoice is legitimate and is paid using the correct amount prior to the due date. This protects the company and helps retain its credit rating. The system refers to the three documents I use. These are the invoice, the purchase order or authorization for the item or service, and the receiving report or confirmation the services were performed. By comparing these, I can verify the amount is correct and the item or services were received. Once this is confirmed, I can perform the entries related to this transaction and authorize payment."
6. Can you tell me about a time when you encountered an ethical dilemma in your work? How did you handle it?
This is a behavioral question meant to provide the interviewer with some insight into your character. The purpose of this type of question is to see how you would handle a real-world situation you may encounter when working for the hiring organization. The best way to answer a behavioral question is by using the "STAR" format - Situation, Task, Action, and Results. This helps you organize your answer and address the information the interviewer is seeking.
Example Answer
"In my last job, a department head requested I pay an invoice, even though they couldn't provide documentation the service was performed. (S) I was confident the service was probably performed and the invoice should be paid, but without documentation, I couldn't authorize the payment. (T) I asked the manager if there was another way they could verify the vendor had performed the service. (A) They collected evidence which indicated the invoice was legitimate. I presented this to my manager who agreed the invoice should be paid which I did. I documented this and reminded the manager that they needed to collect the proper documentation each time a service was completed. This approach resulted in the company retaining its relationship with the vendor and the manager complying with our procedures going forward. (R)"
7. What did you do at your last job to increase revenues, reduce costs, or save time?
Employers hire staff for one of three reasons: to help them make money (sales), save money (costs), or save time, which is the same as saving money. While this question addresses this directly, every response to any question you are asked should demonstrate how you will achieve one of these objectives for the company. You can use the STAR structure to respond to this question even though it isn't a behavioral question. Also, although your answer is retrospective, it should also address an issue the company you are interviewing with may be facing, thereby proving your value to them.
Example Answer
"At my last employer, the key executives were issued company credit cards to pay for business-related expenses. Each month, I had to manually enter the transactions detailed in the bank statements for the cards. This sometimes took up to a full day. I met with the bank who issued the cards and learned that we could integrate their system with our bookkeeping software. This enabled the transactions to be automatically entered into the proper accounts in our system and be classified correctly as well. I could then review the line items to confirm they were correct and authorize the charges. This reduced the time to complete this task by up to 70% and increased the accuracy to nearly 100%, saving the company both time and money."
8. In your opinion, is accrual or cash-basis reporting a better option for business management?
The purpose of this question is to both get your honest opinion about these two bookkeeping systems and to explore your knowledge of them. The interviewer expects you to describe the benefits of each type of system and then select one, providing your rationale for why you prefer it.
Example Answer
"Both accrual and cash-basis reporting have their merits, and either one can be used effectively. Cash-basis reporting is more useful when completing tax returns and makes the process much easier. However, accrual reporting is a better system to use throughout the year. This is because it provides the management team with an accurate and up-to-date assessment of the financial condition and performance of the organization. Therefore, I recommend accrual reporting for most companies."
9. What have you done recently to grow professionally as a bookkeeper?
Employers look for employees who are qualified for the position and have a plan for their professional development and to keep themselves up to date with changing industry trends. You should have this type of plan and be able to discuss both your recent efforts as well as your plans for future growth. Components of the plan can include formal and informal education and training, attendance at industry events, membership in professional organizations, and subscriptions to work-related newsletters and blogs.
Example Answer
"I have always had a professional development plan to keep my skills updated and to stay abreast of trends and developments in the accounting industry. I regularly attend workshops, take online courses, and read blogs from accounting and bookkeeping experts. I recently attended a convention sponsored by the American Institute of CPAs. While there, I attended topical workshops, listened to some amazing speakers, and networked with other bookkeeping professionals. I was also able to get credit toward my continuing education requirements."
10. What type of financial reports were you responsible for preparing in your previous positions?
This is a qualifying question that seeks to understand your familiarity with the different types of financial reports and your ability to create them. It should be easy to answer based on your knowledge and experience. However, be careful not to overstate your capabilities. The interviewer is likely to ask some detailed follow-up questions about specific reports the organization depends on to manage its operations.
Example Answer
"In my recent position, I prepared the most common and popular financial reports. These include the income statement, statement of changes in equity, the balance sheet, cash-flow statement, and the notes accompanying the reports. I also prepared ad-hoc reports as requested by management. Examples of these are banking summaries, investment summaries, net worth reports, and tax summaries."
11. How would you go about reconciling a bank statement?
Bank reconciliation is a fundamental duty for a bookkeeper to ensure the accuracy of cash records. This question assesses your practical understanding of the process, your attention to detail, and your ability to identify and resolve discrepancies.
Example Answer
"To reconcile a bank statement, I start by comparing the company's cash account balance in the general ledger with the ending balance on the bank statement. Then, I go through both documents item by item, ticking off matching transactions such as deposits and cleared checks. For any discrepancies, I identify items that appear on one record but not the other - like outstanding checks, deposits in transit, bank service charges, or interest earned. I would then make adjusting journal entries for items not yet recorded in our books to ensure both records match, thoroughly investigating any significant or unexplained differences."
12. What is the purpose of a Chart of Accounts, and how do you ensure it's well-organized?
The Chart of Accounts is the backbone of a company's financial record-keeping system. This question evaluates your understanding of its structure and importance, and your ability to maintain an organized and logical accounting framework.
Example Answer
"The Chart of Accounts (COA) is a categorized list of all accounts used by a business to record financial transactions. Its primary purpose is to organize financial data systematically, allowing for accurate recording, easy retrieval, and clear financial reporting. To ensure it's well-organized, I follow a logical numerical or alphabetical structure, typically grouping assets, liabilities, equity, revenues, and expenses. I ensure that new accounts are only added when truly necessary and fit within the existing framework, avoiding redundancy, and ensuring that account descriptions are clear and consistent across the organization."
13. Describe your experience with different bookkeeping software, beyond just QuickBooks.
In today's digital landscape, proficiency with various accounting software is highly valued. This question assesses your adaptability and breadth of technical skills, indicating how quickly you might integrate into a new company's existing systems.
Example Answer
"While QuickBooks is widely used, I also have extensive experience with Xero, which I used for a previous employer handling SaaS startups, and some exposure to Sage 50. Each software has its unique features, but my approach remains consistent: understanding the system's workflow, customizing the chart of accounts as needed, and leveraging automation features for tasks like bank feeds and recurring invoices. I'm quick to learn new systems by utilizing online tutorials, user manuals, and hands-on practice, focusing on mastering the core functionalities relevant to the company's specific needs."
14. How do you manage accounts payable (AP) to ensure vendors are paid accurately and on time?
Accounts payable management is a critical function for maintaining vendor relationships and controlling cash flow. This question assesses your process, attention to detail, and understanding of best practices in managing liabilities.
Example Answer
"Effective AP management involves a systematic approach. I ensure all invoices are received, reviewed for accuracy against purchase orders and receiving reports (the three-way match), and properly authorized before entry. I prioritize payments based on due dates, payment terms, and cash flow availability. I use bookkeeping software to schedule payments, track upcoming obligations, and prevent duplicate payments. Regular communication with vendors and internal teams is also key to resolving discrepancies promptly and maintaining good relationships."
15. What is the process for handling accounts receivable (AR) and collecting overdue payments?
Managing accounts receivable is vital for a business's liquidity and revenue cycle. This question evaluates your proficiency in billing, tracking payments, and your approach to recovering outstanding debts while maintaining customer relationships.
Example Answer
"My AR process begins with timely and accurate invoicing, ensuring all necessary details are included and sent to customers promptly. I regularly monitor AR aging reports to identify outstanding balances and proactively follow up on approaching due dates. For overdue payments, I start with gentle email reminders, escalating to phone calls if necessary, while always maintaining a professional and courteous tone. I document all communication, payment arrangements, and follow-up actions. My goal is to recover payments efficiently while preserving positive customer relationships, escalating to management only when internal efforts are exhausted."
16. Explain the importance of internal controls in bookkeeping. Can you give an example?
Internal controls are safeguards against fraud and error. This question assesses your awareness of financial security and integrity, which is crucial for any bookkeeping role. Your ability to provide an example demonstrates practical understanding.
Example Answer
"Internal controls are crucial in bookkeeping because they safeguard assets, ensure the accuracy and reliability of financial data, promote operational efficiency, and encourage adherence to policies and regulations. They minimize the risk of fraud, theft, and accidental errors. An example would be the segregation of duties. This means that the person who handles cash should not be the same person who records cash transactions or reconciles the bank statements. This prevents one individual from having complete control over a financial process, significantly reducing opportunities for misappropriation or error."
17. How do you handle discrepancies or errors once they are identified in financial records?
Errors are inevitable in any detailed data entry role. This question assesses your problem-solving skills, your commitment to accuracy, and your methodical approach to correcting mistakes transparently.
Example Answer
"Upon identifying a discrepancy or error, my first step is to thoroughly investigate its source - whether it's a data entry mistake, a missing transaction, or a bank error. I gather all relevant documentation, such as invoices, receipts, and bank statements, to pinpoint the exact nature and amount of the error. Once identified, I make the necessary adjusting journal entries, ensuring they are properly documented with clear explanations and approval, if required. My aim is always to correct the record accurately and promptly, ensuring the integrity of the financial statements."
18. Describe your process for managing petty cash.
Managing petty cash, while seemingly minor, requires strict adherence to procedures to prevent misuse and maintain accurate records. This question evaluates your attention to detail and ability to follow established financial protocols.
Example Answer
"My process for managing petty cash involves keeping a designated petty cash fund in a secure location, separate from other funds. I assign a specific custodian for the fund. For every disbursement, I ensure a petty cash voucher is filled out and signed by the recipient, detailing the purpose, amount, and date. Original receipts are always required. When the fund needs replenishment, I reconcile the remaining cash with the sum of all vouchers, ensuring they total the original fund amount, then submit a request for replenishment with all supporting documentation. This 'imprest system' ensures accountability and accuracy."
19. What is your experience with payroll processing and associated tax filings?
Payroll is a sensitive and regulated area of bookkeeping. This question assesses your knowledge of payroll components, tax compliance, and your ability to handle confidential employee information accurately and on time.
Example Answer
"I have significant experience with end-to-end payroll processing, including calculating wages, salaries, overtime, deductions for taxes (federal, state, local), benefits, and garnishments. I've used [mention specific payroll software, e.g., QuickBooks Payroll, ADP, Paychex] to process bi-weekly payrolls for up to [X] employees. My responsibilities also included preparing and filing quarterly payroll tax returns (e.g., Form 941) and annual forms like W-2s and 1099s, ensuring strict adherence to deadlines and tax regulations to avoid penalties. I also understand the importance of maintaining strict confidentiality with all payroll data."
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20. How do you prepare for and assist with external audits?
Bookkeepers often play a key role in supporting external audits. This question assesses your understanding of the audit process, your organizational skills, and your ability to collaborate with auditors to ensure a smooth audit.
Example Answer
"When preparing for an external audit, my primary goal is to ensure all financial records are well-organized, accurate, and easily accessible. I proactively gather and organize requested documents, such as general ledgers, journal entries, bank statements, invoices, and reconciliation reports. I compile detailed schedules for key accounts and transactions. During the audit, I serve as a primary point of contact, responding promptly and clearly to auditor inquiries, providing explanations for entries, and retrieving additional documentation as requested. My objective is to facilitate their work and demonstrate the integrity of our financial records."
21. What steps do you take to ensure data security and confidentiality of financial information?
Financial data is highly sensitive. This question assesses your awareness of data security best practices and your commitment to maintaining confidentiality, which is paramount in a bookkeeping role.
Example Answer
"Ensuring data security and confidentiality is a top priority. I adhere strictly to company policies regarding data access and sharing. This includes using strong, unique passwords for all systems, implementing two-factor authentication where available, and never sharing login credentials. I ensure all sensitive documents are stored securely, either in locked physical files or encrypted digital folders with restricted access. I'm also diligent about securely disposing of confidential paper documents through shredding and clearing digital data from old devices according to IT protocols. I understand the ethical and legal implications of protecting financial information."
22. How do you stay updated with changes in accounting principles or tax regulations?
The financial landscape is constantly evolving. This question assesses your commitment to continuous learning and your proactive approach to keeping your knowledge current, which is vital for compliance and maximizing performance.
Example Answer
"I have a proactive approach to staying updated. I regularly subscribe to reputable accounting industry newsletters and blogs from organizations like the AICPA and IRS. I also attend relevant webinars and workshops on new tax laws or changes in accounting standards, such as GAAP updates. Networking with other bookkeeping professionals and participating in online forums also helps me stay informed about practical implications and best practices. This continuous learning ensures I'm always applying the most current and compliant methods."
23. Can you explain the difference between a cash flow statement and an income statement?
This question delves deeper into your understanding of financial statements, testing your ability to differentiate between how various reports reflect a company's financial health. It shows you understand what each statement communicates beyond just the numbers.
Example Answer
"While both are crucial financial reports, an income statement (or Profit & Loss statement) shows a company's financial performance over a period, detailing revenues, expenses, and ultimately, net income or loss. It operates on the accrual basis of accounting. A cash flow statement, on the other hand, reports the actual cash generated and used by a company over a period. It categorizes cash flows into operating, investing, and financing activities, providing insights into the liquidity of the business. The key difference is that the income statement shows profitability (accrual basis), while the cash flow statement shows actual cash movement, which can be very different from profit."
24. How do you prioritize your tasks when faced with multiple deadlines?
Bookkeeping often involves managing numerous tasks with strict deadlines. This behavioral interview question assesses your time management, organizational skills, and ability to perform under pressure effectively.
Example Answer
"When faced with multiple deadlines, I first assess all tasks by urgency and importance. I create a prioritized list, distinguishing between critical statutory deadlines (like tax filings) and internal reporting deadlines. I break down larger tasks into smaller, manageable steps. I also communicate proactively with my manager or relevant departments if I foresee any potential conflicts or need clarification on priorities. Utilizing calendar reminders and task management tools helps me stay on track and ensure that critical obligations are met without compromise."
25. Describe a time when you had to adapt to a new accounting system or software quickly.
This behavioral question assesses your adaptability, learning agility, and resilience in embracing technological changes, which is a common requirement in the evolving field of bookkeeping.
Example Answer
"In my previous role, our company transitioned from an older, desktop-based accounting software to a cloud-based system, Xero, with very little lead time. My task was to migrate historical data and quickly get up to speed to maintain daily operations. I proactively engaged in all available training sessions, watched online tutorials extensively during off-hours, and familiarized myself with the new interface and functionalities. I also created a cheat sheet of common tasks and workflows. Within two weeks, I was fully proficient, managing daily entries and reconciliations without disruption, and even helped train other team members. The transition was smooth, and we benefited from the new system's automation capabilities."
26. What is your understanding of generally accepted accounting principles (GAAP) or International Financial Reporting Standards (IFRS) as they apply to bookkeeping?
This technical question gauges your awareness of the foundational rules governing financial reporting. While bookkeepers may not set policy, understanding these principles ensures accuracy and compliance in their daily work.
Example Answer
"My understanding is that GAAP (Generally Accepted Accounting Principles) are a common set of accounting principles, standards, and procedures issued by the FASB that U.S. companies must follow when compiling their financial statements. IFRS (International Financial Reporting Standards) are similar, but used internationally. As a bookkeeper, these principles guide my daily work by ensuring consistency, comparability, and transparency in financial record-keeping. For example, the revenue recognition principle under GAAP dictates when revenue should be recorded, even if cash hasn't been received, which is crucial for accrual basis accounting. Adhering to these principles ensures financial statements provide a true and fair view of the company's financial position."
27. How do you ensure accurate classification of expenses (e.g., operating vs. capital)?
Proper classification of expenses is crucial for accurate financial reporting, tax compliance, and business analysis. This question tests your technical knowledge and your attention to detail in applying accounting rules.
Example Answer
"Accurate expense classification is vital for financial integrity. My approach involves understanding the nature and purpose of each expenditure. For example, operating expenses are typically regular costs of doing business (e.g., rent, utilities, salaries), while capital expenditures are investments in assets that will provide long-term benefits (e.g., purchasing new equipment, building improvements). I meticulously review invoices and supporting documentation, cross-referencing with the company's Chart of Accounts and accounting policies. If there's any ambiguity, I clarify with the relevant department head or consult a senior accountant to ensure correct categorization and compliance with accounting standards."
28. How do you handle communication with non-financial staff regarding financial matters?
Bookkeepers often need to explain complex financial concepts to individuals without a finance background. This behavioral question assesses your communication skills, patience, and ability to simplify information effectively.
Example Answer
"Communicating financial information to non-financial staff requires clarity and patience. My approach is to avoid jargon and use plain language, focusing on the 'what' and 'why' in terms they can understand. For example, if explaining a budget variance to a department head, I'd show them the numbers but also contextualize them with operational impact rather than just technical accounting terms. I encourage questions, use visual aids like simple charts if helpful, and always aim to explain how their actions impact the financials. The goal is to empower them with understanding, not overwhelm them with accounting complexities."
A word of warning when using question lists.
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