Regular bookkeeping is necessary to sustain a business for long periods.
Accurate financial records help you prepare for tax filing and stay compliant.
It allows business owners to make informed decisions like product pricing, marketing campaigns, and investments.
The biggest reason businesses require bookkeeping services is to identify growth opportunities.
While most business owners tend to do their own bookkeeping, it becomes more of an inconvenience once the operations and data expand.
And understandably so. You don’t want to be spending hours of your day handling cash inflows and outflows when you have an empire to build.
But there comes a point where you must delegate this responsibility to a credible source.
And that is when you look for reliable and affordable bookkeeping services.
And that’s exactly what I’m going to help you with – how you can find affordable bookkeeping services for your business.
Key Takeaways
- 21% of businesses don’t know enough about bookkeeping.
- Bookkeeping helps businesses keep track of their finances and ensure data accuracy for informed decision-making.
- Bookkeeping services support businesses by helping them manage their finances along with time.
- Make sure you hire an affordable bookkeeper who understands your business needs.
Bookkeeping services for small businesses – A quick overview
- Cloud bookkeeping companies have witnessed a 15% increase in their annual revenue.
- 29% of businesses have automated their account payable and receivable process to reduce manual labor and increase data accuracy.
- And 21% of SMB owners don’t know enough about bookkeeping.
A common trend that you may observe in these numbers is that you need bookkeeping services to sustain your business.
But what exactly should you expect from bookkeeping services and how does it work?
What to expect from bookkeeping services?
When you hire a professional bookkeeping service, they will assign a dedicated bookkeeper to handle your books.
- First, you will connect them to your financial account. This requires you to share your credit card and payment processing information along with bookkeeping software.
- Next, the bookkeeper will be responsible for reconciling your transactions daily, monthly, quarterly, and annually to ensure accuracy.
- They will also create regular financial reports like balance sheets and income statements so you have real-time and up-to-date information for decision-making.
- They will also generate invoices and bills.
- And they will also take care of payroll processing.
Now the question is: how will all of this impact your business?
Well, first and foremost, you will have a clear understanding of your money and the financial health of your business.
Your data will be consistent and accurate across channels.
You would know where to invest your money and how much of it.
And most importantly, you will avoid making costly mistakes and stay in the good books of the IRS.
Let’s sum it up with the four core operations they will be responsible for.
Record Daily Transactions and Cash Flow: A bookkeeper will record your daily transactions and ensure accuracy.
Process Payments: A bookkeeper will approve and process payments and send reminders for delayed payments.
Generate Invoices: A bookkeeper will be responsible for generating invoices in a timely manner and maintaining consistency throughout the process.
Handle Payroll: A bookkeeper will handle payroll and regulate your cash flow system.
4 benefits of bookkeeping services
1. Avoid critical errors
The main reason why you should hire a bookkeeping service is because you will see a remarkable increase in data accuracy.
A reliable bookkeeping service helps you avoid costly mistakes in tax filing and payroll processing.
They will also ensure your financial statements are correct and up-to-date.
They will reconcile your transactions and generate invoices and bills on time so you don’t face unnecessary penalties.
2. Financial analysis
A good bookkeeper will help you create up-to-date financial statements for accurate reporting and informed decision-making.
Without the right information in your hands, you can’t make the right decisions and won’t know where your business stands financially.
3. IRS compliance
The most important role that a bookkeeper will play in your life is to help you stay compliant.
A professional bookkeeper will have a clear understanding of IRS policies and rules.
They will help you not only file your taxes timely and accurately, but they can also guide you to make the most of tax deductions.
4. Time management
Bookkeeping may seem like a simple data entry job to you but it’s much more complicated than that – and not to forget, time-consuming.
You might be able to update your books yourself during the initial stages of your business.
But as your business grows, the data and workload will increase with it. This is the time when you’ll have to prioritize your tasks.
With enough in your bucket already, bookkeeping might take a backseat.
It may not seem that big of a deal at first but it will all come crumbling down once the tax season commences or you miss paying your vendors.
Time management is crucial but by outsourcing your bookkeeping you will manage at least one of your many burdens.
3 main types of bookkeeping services
1. DIY bookkeeping
This is the option for those in the early stages of their business. 60% of businesses handle their own books.
This option allows you to establish control while also saving money.
You would have a decent idea of your business finances. It is a solution that just might work for you.
But because it is a time-consuming task, there will come a time when you’ll have to consider other options.
But until then, DIY bookkeeping is right for you.
2. In-house bookkeeping
When the volume of data increases, the need for an in-house bookkeeper increases with it.
You clearly won’t manage to maintain your books at this time, at least not accurately.
And so, you have the option to either hire a part-time or full-time in-house bookkeeper.
Hire someone depending on your budget and business needs.
3. Outsourced bookkeeping
Outsourcing bookkeeping services is the ultimate option for businesses that wish to delegate this task to professionals while keeping the costs as minimal as possible.
When you outsource your bookkeeping, you’ll discover services that provide accounting services in the package.
They will give you an all-rounder service and maintain hands-on involvement so that make smarter decisions.
3 actionable tips for finding affordable bookkeeping services
Let’s explore the 4 important tips that will help you find an affordable bookkeeping service for your business.
1. Hire a bookkeeping service that understands your needs
When you hire an accountant, ask them one simple question: Are they willing to grow with you?
Be clear and set out your expectations. If they still sign up, maybe you’re headed in the right direction.
Assess their expertise in working with tools that support your company’s growth.
Can they handle large volumes of data and the pressure that comes with tax filing?
These are simple but important questions that will give you clarity on their role in the growth of your business.
2. Opt for remote or virtual bookkeeping service
While you may be in favor of hiring an in-house bookkeeper, we live in a world that is increasingly adapting to the remote working environment.
Thus, when and if you choose to go ahead with a virtual bookkeeping service, make sure you establish your communication requirements from the get-go.
Zoom and Google Meet are some of the common tools that businesses use to communicate with each other.
Furthermore, NetSuite implementation has made cloud-based data facilities available.
This way, whether you are working in an office premises or any other location, data is at the tip of your fingers.
3. Ask Them About the Accounting Software They Use
And last but not least, ask them if they have a preference for accounting software.
While QuickBooks Online is the most popular accounting software, there are other mainstream accounting tools available.
And it’s possible that they are expensive. So make sure you are on the same page as them before they join you officially.
The Bottom Line
Bookkeeping is the foundation of your business finances.
Hiring affordable bookkeeping services is essential for any business that hopes to scale its operations.
To find the right fit, you must hire bookkeeping services that understand your needs and industry standards.
And make sure you establish working dynamics and verify their educational and professional credentials before they get hired.
Ledger Labs has been helping businesses manage their bookkeeping for over 12 years now.
We have helped businesses in different industries and sizes.
To find out more about our bookkeeping services, you can book a consultation with us today!
