Small Business Accounting Personnel - Administrative Assistant and Clerks

The first person to handle the accounting for most small businesses is generally the owner. As the company grows, the owner starts to look for someone to take over these duties so they can concentrate on the sales and operations of the firm.

Often, the owner chooses to turn the accounting duties over to the firm’s administrative assistant or clerk. This happens because they are already employed by the business, which makes it cost effective to cross-training them to perform accounting activities. Another reason owners chose to have administrative assistants or clerks perform the accounting is that that they have already earned the trust of the owner in the other duties they perform.

The biggest advantage to using an administrative assistant or clerk for your company’s accounting is cost. The primary disadvantage is their lack of accounting knowledge, which can be overcome if you are fortunate enough to have someone in this role that is eager to learn. If not, you will eventually be faced with having to hire someone with the level of accounting knowledge that is needed for your firm.

Comments

[Michele Laidlaw]

what about the dangers of lack of segregation of duties by giving too much authority to a clerk or admin assistant?

[Scot Justice]

Michele,

Thanks for your comment and for reading my blog!
You bring up a good point about segregation of duties.

This is definitely something small business owners should be concerned with. I don't have the exact statistics in hand, but in the past the Association of Certified Fraud Examiners has reported that a high percentage of fraud, both in number and in dollar cost, is perpetrated at small companies.

The cause of a lot of this is having a small staff (or one staff who handles this) and lack of owner’s oversight or segregation of duties.

Thanks again for your comment; I’ll probably write a blog series on fraud in small business in the future to address your question.

Scot