How maker-checker works
The maker-checker principle is common in accounting, banking and payment processing because it splits execution from approval. In bookkeeping, a maker might enter bills, categorize transactions or prepare a bank reconciliation, while a checker reviews that work against source documents before it is finalized or before a payment is released.
The control works best when the checker has genuine authority to reject or send work back, and when the split is enforced consistently rather than skipped under time pressure. Maker-checker does not require expensive software; it can be run through a review checklist and sign-off log as easily as through an automated approval workflow.
Example
A bookkeeper, the maker, enters and categorizes the month's bank transactions and drafts the reconciliation. A second, more senior accountant, the checker, reviews the reconciliation against the bank statement and supporting documents before the period is marked closed, catching a $1,200 miscategorized expense that would otherwise have understated profit for the month.
Maker-checker in QuickBooks Online vs Xero
Maker-checker is a process control rather than a software feature, though tools such as Karbon or a shared close checklist can enforce it by requiring a second sign-off before a task is marked complete. QuickBooks Online and Xero support user permissions that can separate who enters data from who can lock a period.
Common mistakes
- Letting the same person act as both maker and checker under time pressure, which defeats the purpose of the control since no independent set of eyes reviews the work.
- Giving the checker no real authority to reject or send work back, which turns the review into a formality instead of a genuine check on errors or fraud.
- Applying maker-checker only to some transactions, such as large payments, while skipping it for routine entries, which leaves the exact area where small errors accumulate unreviewed.
Why it matters
Maker-checker is one of the simplest, lowest-cost internal controls a business can put in place, and its absence is one of the first things a lender, auditor or fraud investigator looks for when something goes wrong. For a small business owner without the staff for a full internal-controls program, splitting who enters a transaction from who reviews it catches errors and discourages fraud before either reaches the financial statements.
Related terms
How LedgerBPO handles maker-checker
Every close we run follows a maker-checker structure: a dedicated bookkeeper prepares the work, and a second reviewer checks it against source documents before anything is finalized. We call this our two-tier review process.