Do You Need an Outside Bookkeeper?

One of the most important tools you can use to become more competitive and profitable is a bookkeeping service.

After they hire professional bookkeepers, businesses enjoy average profit increases of 16%.

Does your business need a bookkeeper? Here are some things to consider:

Bookkeeper Responsibilities

What does a bookkeeper do? A bookkeeper gets financial processes in order, prepares financial statements and provides data for budgeting, raising capital and other uses.

A skilled bookkeeping partner should have the ability to:

• Maintain a general ledger and record incoming and outgoing funds
• Reconcile your books with balances from your bank(s), and correct any inconsistencies
• Send you financial statements that share the financial health of your company and your monetary trends
• Keep accurate records to improve your reporting and analysis
• Get tax data ready at tax time
• Help your business adhere to all laws and regulations

When a Business Needs a Bookkeeper

If You’re Having Trouble Keeping Up

If you have trouble keeping up with your books, you won’t know how much you’re earning and what actions might increase your profits. If your books are a mess, you’ll have to play catch-up at tax time (no fun).

If Sales Are Up, But Profits Are Down

If sales are up, but profits are down, tax-ready financial statements from your bookkeeper can show you places where you can reduce costs or raise prices.

If You Don’t Know Your Cash Flow

If you don’t know your cash flow, you’ll have a hard time making necessary payments. You need a monthly cash flow statement that shows your receivables and payables so that you are always prepared to pay your employees or vendors.

If Bookkeeping Takes Up Too Much Time

How a Bookkeeping Company Can Help Your Small Business

The following are some ways a bookkeeping service can help your business grow:

Manage accounts day-to-day

Every day, your bookkeeper will record all transactions for your business. Their software will automatically register income and expenses, making it much easier to stay aware of your cash flow.

Maintain accurate, current records

Your bookkeeper will keep all your records up to date. It will also be their responsibility to find any inconsistencies between your books and your business accounts, so these can be resolved as quickly as possible.

Manage accounts with the bank

A bookkeeping partner can set up and manage bank feeds that link your accounting software with your business account. When bank feeds are set up, you and your bookkeeper will be able to view transactions when they happen.

Prepare statements showing your financial position

Your bookkeeper will prepare reports for your business, such as P&L statements, balance sheets and cash flow statements. These reports show where you stand, how much you are spending on operations, your current assets and liabilities, and cash flow.

How to Choose a Bookkeeper for Your Small Business

There are three options for hiring bookkeeping:

1. Hire a solopreneur
2. Work with a company that only does bookkeeping
3. Use an outsourced bookkeeping firm

Each approach has pros and cons:

1. A freelance bookkeeper is the most affordable, but they may not be available when you need them.
2. Bookkeeping firms have several bookkeepers on staff. Someone will always be available if you need help.
3. Online bookkeeping solutions connect you with a stable of bookkeepers who may be located anywhere in the world.

Whoever you choose, make sure they will be available when you need them, capable of communicating in layman’s terms, and able to protect your data from a cyberattack.