Bookkeepers are responsible for handling a major part of your business finances.
Hiring a full-time bookkeeper might be slightly impractical for a young business.
In fact, most businesses turn to seasonable bookkeepers during tax season to handle their tax preparation, a major headache for small business owners.
But you never look back once you understand how constant or ongoing bookkeeping can switch gears for your business.
Contrary to popular belief, you don’t even need to spend thousands of dollars to manage your bookkeeping.
Part-time online bookkeeping is a convenient and affordable way to ensure your books get updated in a timely manner. It ensures regular compliance and consistency within your financial data.
While there are many advantages to hiring an online part-time bookkeeper, you should always know what aspects to consider when hiring one.
Let’s explore this in detail.
Key Takeaways
- 70% of small businesses don’t have an accountant on board.
- Tax season is exhausting so make sure you hire a bookkeeper that has tax knowledge.
- Experience and credentials are important hiring criteria but also discuss their preferred mode of communication and their charges to see if they meet your budget.
- A bookkeeper is an investment that helps you manage your finances and improve financial performance.
The significance of a bookkeeper in a small business
72% of accounting and bookkeeping practices increase revenue.
And yet 21% of SMB owners don’t know enough about bookkeeping. Roughly 70% don’t even have an accountant.
This goes on to prove the value bookkeeping adds to your business.
Now you might initially think that you can do your own bookkeeping and save the cost.
And it’s probably the right decision should your business be in its early stages where the volume of data is manageable amongst other things.
But once the business grows your data will get complex and you’ll start noticing the cracks. This includes data inconsistencies, accounting mistakes, and calculation errors.
You might start to feel frustrated or too overwhelmed with the amount of time that goes into its management.
Sooner or later, you’ll accept the importance of hiring a bookkeeper.
Now what should you expect from a bookkeeper?
For starters, they handle your day-to-day transactions, monitoring your cash inflows and outflows.
They are responsible for maintaining your financial records, and ensuring every transaction is noted and categorized correctly.
A bookkeeper manages your account payables and receivables.
So they make sure you receive your payments on time.
They are also punctual with invoice generation.
In addition, a bookkeeper will prepare your financial statements to ensure it is ready for reporting and analysis.
Many bookkeeping services also provide payroll support. So, they manage employee salaries, vendor payments, and other miscellaneous tasks.
But one has to understand that a major chunk of their time goes into cash flow management – a task that literally makes or breaks a business.
Potential benefits of a bookkeeper
- Your financial records are up-to-date and ready for tax season.
- Accurate financial records help you stay compliant with the tax regulations.
- Organized financial records reduce stress and increase your confidence.
- Bookkeeping saves you time and money, helping you focus on core business activities and implement cost-saving solutions.
- By inculcating regular bookkeeping practices, you gain more control over your finances.
- It decreases data inconsistencies and chances of error.
- Regular bookkeeping allows you to budget and forecast financial trends for more effective planning.
- It improves cash flow management.
- Bookkeeping helps with improving your relationship with your vendors, investors, and clients.
- It makes your reporting more accurate and the process more efficient.
Is it better to hire a part-time bookkeeper?
Currently, workplaces are implementing remote or hybrid models to accommodate the evolving needs of the human condition.
And when you think about it – technology has become so advanced that there’s literally nothing an onsite employee can do that an online bookkeeper cannot.
Enter the part-time model into the mix and you have a dedicated bookkeeper with whom you can book a weekly meeting to get the latest updates and pay half of what you’ll pay to a full-time employee.
It’s usually an ideal option for small businesses with limited resources.
Part-time online bookkeeping is affordable for any small business with financial management as its top priority.
You can pay a part-time online bookkeeper per hour, per day, or per task – whatever is feasible for you.
Speaking of technology earlier, let’s not forget to mention the role of cloud-based accounting tools.
It provides remote access to your virtual bookkeeper from any part of the world.
6 things to look for in a part-time bookkeeper
Now let’s talk about the things you must consider when hiring a part-time online bookkeeper.
1. Experience
Experience is the first thing you should look into in a bookkeeper.
By asking them questions about their experience you know if they fit the role in your business. You understand what value they can bring to the table.
Ask them the following questions:
- Where have you worked before this?
- How many years of experience do you have?
- Which industries have you worked in?
- What business sizes are you comfortable working with?
These questions can give you a quick summary of their background.
2. Credentials
You have to also stick to the book. So, don’t forget to include basic information like their educational background.
While many businesses are getting comfortable with candidates with non-traditional backgrounds, it’s up to you to decide what works for you and what doesn’t.
Also, verify and authenticate the credentials.
3. Understanding of the tax system
It is important to have an understanding of the legal and tax system.
A bookkeeper can help you with corporate tax filing and arrange your documents and finances accordingly.
Tax season can be a headache for small business owners.
While it is important to be involved in managing your business finances, there are some responsibilities that you can do without.
Tax preparation can be exhausting and you can use that energy to create newer business strategies rather than paperwork.
So ensure you hire someone who understands and is ready to support you with tax preparation.
4. Feasibility
The reason for hiring a part-time online bookkeeper is to find someone who aligns with your business needs without costing you an arm.
Therefore, you can interview candidates to see who fits the role but also stays within your budget.
Outsourcing your bookkeeping is the most feasible option because you hire people for results, not just the days they spend working for you.
5. Communication
Once you’ve established their proficiency in bookkeeping and sorted out the budget, it’s time to discuss how comfortable they are with communication. Ask the following questions:
- What software would they use for communication?
- Are they comfortable with weekly meetings?
- How proactive they are with tasks?
The answers will give you an idea of what your working equation would look like.
6. Flexibility
So you are looking for an online part-time bookkeeper. But that’s because you are a small business with limited resources.
But you have to keep an open mind and be willing to switch things up when the time comes.
It means your business will grow eventually, so you need someone who can accommodate your growing needs.
Be transparent and ask if they are comfortable with a larger volume of data.
Would they be able to handle it? Are they growth-oriented?
Their answers will help you realize if they are flexible enough.
4 tips for hiring a part-time bookkeeper
Let’s explore the top 4 hiring tips.
1. Define expectations
An important step in onboarding a part-time bookkeeper is to lay out all your expectations.
Clearly communicate what you want and expect from them.
Mention all the responsibilities. It is even better if you provide them with their job description.
You can highlight specific tasks that you find to have higher priority.
And always make sure you discuss the technical aspects of your business. Are they comfortable with the tools you use? Do they need support with that?
Familiarity with the tools is necessary.
2. Conduct monthly or weekly meetings
Evaluate any strong relationship and you’ll boil it down to good communication.
And that’s true for every type of relationship, including professional ones.
Thus, when you hire a bookkeeper, make sure you are both on the same page.
Meet once a month or weekly to discuss your finances.
Be regular about it and ensure you go to lengths discussing how your finances can be improved.
3. Implement all security measures
Security should never be a second thought. Tighten your security if you’re bringing someone new on board.
Make sure your data isn’t compromised. It should be private yet accessible.
Whether you are a small business or a growing company, invest in a robust security system.
4. Ensure they have everything they need
And before you both start, make sure they have everything they need to do their job right.
Discuss the feasibility of accounting tools and choose an automation too that you’re both familiar with. QuickBooks Online is affordable and easy to use.
Ask them repeatedly if they need anything so they can provide you with optimal results.
The bottom line
Hiring a bookkeeper is an important business decision.
They can manage your finances efficiently, allowing you to focus on core business activities and growing the business.
While you must evaluate the credentials and experience, make sure you also discuss feasibility, communication, and flexibility during the hiring process.
Also, do ask your potential candidates if they understand the tax system.
Clearly define your expectations when you’re hiring a part-time online bookkeeper. It will kick things off in the right direction.
Ledger Labs is an online service providing support to businesses for over 12 years.
We have helped businesses across industries and sizes and have effective tools to ensure all-rounder support.
You can book a consultation appointment today to discuss this in more detail.
