5 min read

How to Handle New Clients & Their Messy Year-End Close


Year-end is a great time for your accounting firm to prepare for an influx of client requests. For better or worse, tax deadlines create a natural force for businesses to think about organizing their financials.

And while many business owners could use extra help organizing their financial information and documents, a survey in 2018 showed almost half—45% of them—employ neither an accountant nor a bookkeeper! That means two things: accounting firms are underutilized during one of their busiest times of the year, and they could become even busier if more business owners seek their help with year-end close. 

Indeed, the prospect of receiving new business may be encouraging (especially in times of inconsistent revenue), but you could quickly find yourself with too much of a good thing. That’s a different kind of problem for CPA firms that might already be stressed due to current times.

So how do you make sure that you don’t get overwhelmed by this surge of new client work? It’s all about setting yourself up for success, building effective onboarding systems, and managing your year-end engagements efficiently. Here’s everything you need to know to handle all the messy cleanups that are coming your way at the end of 2020.


1. When It Comes to New Business, Prioritize High-Quality Clients

First, make sure that you have an effective system for vetting potential clients. There’s a limit to how much work you can accept, and you want to avoid filling up your limited bandwidth with difficult clients.


Bad clients slow down engagements and make the process significantly more frustrating, which leads to client turnover and decreases your bottom line. To avoid all of these problems, look for these three qualities (at a minimum!) in new clients.


Good communication skills

Poor communication is one of the biggest red flags in a potential client. Fortunately, it’s also one of the easiest to detect.

So before you agree to begin working with a client, pay attention to how well they correspond with you. The best clients:

  • Respond to emails quickly

  • Clearly provide the information you need

  • Are respectful and friendly

Watch out for prospects that respond slowly, force you to repeat the same line of questioning multiple times, and question your authority or strategy.


Healthy price expectations

The clients whose expectations on price align with what you’re offering are going to be the most fruitful for your firm. It helps to be forthright with how much your services cost since that will naturally filter out those who are unwilling to pay.

These are two of the biggest problems to watch out for and some ways to spot the corresponding red flags:

  • Paying late consistently: Chasing down slow-to-pay clients is a drag, not to mention dangerous to your cash flow. While you can’t know for certain whether a potential client will pay on time, one great way to protect yourself from late payers is to require a deposit before beginning engagements. Those who protest too much or take too long to deliver will probably not be worth working with.

  • Caring more about price than value: Extremely price-sensitive clients are likely to be unpleasant partners. If a potential client balks at your pricing or attempts to haggle you down too much, it’s probably not going to be a good fit. Don’t waste your time! Focus instead on clients who understand the value of the services you provide and care more about getting good service than getting cheap service.


Respect for your expertise

Lastly, prioritize clients who respect your expertise. Of course, you want your clients to be involved in your process, but no one wants to be micromanaged!

When you first meet or begin planning an engagement with a potential client, look for any signs that they’ll be unusually difficult to please, like:

  • Their requests go above and beyond your typical scope of work

  • They push back when you make suggestions

  • They question or reject your timeline estimates


2. Systematize Your Processes

Even if you weed out most of the problematic potential clients, there’s still a high probability that a bunch of new clients means a bunch of messy books to deal with.


They may be unfamiliar with accounting processes and have incomplete financial records, and overall their engagements will require more work than your existing client base.

But there’s an easy way to help you manage the extra workload: systematize as many processes as possible.


Onboarding and Cleanup

Before you can even begin working with your new client, you’ll need to take them through an onboarding process where you:

  • Introduce them to your general operating systems and platform

  • Define specific deliverables and set expectations for the engagement

  • Familiarize yourself with their financial records

Some great ways to do this are to create a standard welcoming email series, a template for a client questionnaire, and a checklist of topics for your kickoff meeting.

Your cleanup process should be just as organized and consistent as your onboarding. Of course, every client’s books will be different, so you may be limited in how much standardization you can create.

Still, there are a few techniques you can implement:

  • Build a repeatable system for assessing and ranking the status of clients’ records

  • Create a standard engagement checklist for your staff to follow

  • Create a checklist and form with what you need from your client

  • Streamline your internal communication and review processes


The Role of Technology

Your onboarding and cleanup processes will both get easier the more you leverage technology and automation to do the work for you.

For example, consider the sheer amount of hours you could (or already do) save by taking advantage of even one of the following:

  • Automation of your email welcome sequences

  • Cloud software that collects and aggregates your client’s financial data

  • Bank reconciliation technology that tracks and sorts expenses automatically


3. Technical Considerations

Setting your engagement up proactively and using the proper tools once it’s going will do wonders for your efficiency, but you still have to do the work.


Do you have tech practices in place to make short work of cleaning up a new client’s books? Optimizing the bookkeeping is key here, and tech can make it easier.

Here are a few ways that you can make the cleanup process more efficient:

  • Prior-year tax returns are your guide: Tax returns provide the best starting place for bookkeeping cleanup, even if you have to go back and amend them. Don’t trust the financial statements a client provides if they’re too messy!

  • Create a chart of accounts: Having an organized chart of accounts makes integrations and future bookkeeping work much faster. They help data flow seamlessly from one system to another so that each iteration uses the same terminology. 

  • Integrate (or establish, if needed) data flow: Make sure your clients’ data is flowing in modern tools that allow for simple collaboration and speed.


2020 Considerations

In addition to the typical bookkeeping cleanup work, there will be some unique issues this year because of 2020’s challenges.

To make sure that your clients are completely up to date and ready for the end of the year, make sure that you also address:

  • Payroll Changes: Payroll records can be a pain in the best of times, but with all the layoffs and downsizing due to the pandemic, your clients’ payroll situation might be worse than ever. Don’t wait until you find inconsistencies to inquire about their staffing and payment choices. Make it part of your onboarding process to learn about anything atypical.

  • Paycheck Protection Program (PPP) Loans: Make sure you ask your client if they took advantage of PPP loans, and find out how well they followed the forgiveness guidelines. There’s a lot of ambiguity around handling the loans, so consider creating or finding a resource that you can point them to when they have questions.

Of course there are tons of resources out there to help make sure you’re taking all the necessary steps in preparing for this unique tax season. Check out this helpful checklist!


Putting it All Together

The truth is that as the year wraps up and your firm heads into a busy start to 2021, time is hardly on your side. But not all hope is lost! You can still take advantage of technology to help with your firm’s growing client base and their specific needs. You’re not alone when it comes to landing high-quality clients, creating effective systems to best serve them, and providing the most efficient onboarding and ongoing bookkeeping services.


Botkeeper has a wealth of options to help your firm weather year-end close and create the ideal tax season. In particular, our Rapid Write-Up package makes tax season as easy as possible by tackling manual data entry, handling the back-and-forth communication with your clients, and wrestling those QuickBooks Desktop files you’d love to avoid.

Plus, our cutting-edge software integrates with your clients’ various accounts to automatically handle account reconciliation, double-entry bookkeeping, and even invoicing.

We’d love to talk with you about all the ins and outs related to working with Botkeeper, so click below to get in touch with a specialist today!