How to hire bookkeeping service?
Is your company growing rapidly, and you’re having trouble keeping track of the finances? If yes, you know it’s time to hire bookkeeping service for your company. We’re here to share some things you need to know before hiring the best bookkeeping service for your small business.
When and who to hire
You don’t need to hire a bookkeeper full-time or in-house unless your business is making over a million dollars in annual revenue or has more than thirty employees.
You have three more options that you could choose instead. You could either hire a freelancer, a remote bookkeeping service, or work with a bookkeeping firm. Each of these options has its own pros and cons, and you need to keep several things in mind before hire bookkeeping service.
Hiring a freelancer
If you do not need a bookkeeper available on the site every single day, and your finances are simple, then hiring a freelance bookkeeper might be the best option for you.
Freelance bookkeepers are a more affordable solution since they charge less than firms. They charge overhead, either per hour or at a flat rate. The time and charges of a freelance bookkeeper depend on how many employees you have, the complexity of your firm, and how many transactions you process in the month.
Freelance bookkeepers can also take up one-time projects like catching up with the books and completing old books that you need help with. If you continue to work with the same freelancer, flat rates are more feasible and also a predictable bookkeeping expense in the monthly budget.
If your business is paperless with digitized documents, it is most suitable for you to hire a freelancer online. However, if you have papers that need to be looked after, any local freelancer should be able to visit you to collect and organize the papers, in person.
In both cases, you can also use bookkeeping software, making sure that your bookkeeper also uses the same one. This will ensure that you can import expenses remotely, saving trips to the office and cutting out any unnecessary email threads.
Freelance bookkeepers may not have worked with CPAs before. You should ask this before hiring so you know if they have the required experience with helping find accountants to do the taxes on time.
A drawback of hiring a freelance bookkeeper is an uninformed absence. They might take a vacation whenever they please or take a sick leave unexpectedly. There are busy seasons in bookkeeping, particularly towards the end of the financial year when the books need to be closed for the tax season. During this time, your bookkeeper won’t be able to give your business the required attention that is needed. These things need to be consulted before hiring.
Your bookkeeper might be insured against errors and emissions, but your business is always on the hook in case of any error. Incorrect books can create hazards, either by causing you to make misinformed decisions or by misreporting taxes, which could result in penalties from the IRS.
Thus, finding a bookkeeper who knows what they’re doing is very important. Expertise is not only determined by certification and years of operation. You need to find a bookkeeper that has worked closely in the area of your expertise and has worked with similar businesses.
How to find a good freelancer?
You can find freelancing bookkeepers on multiple sites online. Upwork.com is a good place to start if you want to hire a bookkeeper that has high reviews from clients like you.
Working with a firm
In a bookkeeping firm, you will find multiple bookkeepers under one roof. If you want a bookkeeper available every day for your business, and you don’t mind paying a bit more, then working with a bookkeeping firm is a suitable choice for you.
Generally, bookkeeping firms charge a little more than freelance bookkeepers since firms have a greater overhead to cover. Bookkeeping firms may charge per hour or a flat monthly rate. The charges will depend on how much time your books take, and if there is any catch-up bookkeeping that needs completion.
Cloud-based services have made things much easier for everybody. Firms can now work remotely with clients using these services. However, you need to be acquainted with the same services that your bookkeeping firm is using. It might be a learning curve for you, but it will also open the doors for a paperless office.
You have another option of having somebody collect your paperwork from the site or you can drop off the documents yourself at the firm’s office. Most firms also have accountants employed, who can handle your taxes and fulfill other accountant duties. Even if they don’t employ accountants themselves, they’ll be able to refer you to locally certified accountants. You can discuss all these things before hiring any firm.
Bookkeeping firms employ multiple bookkeepers, so you won’t encounter service gaps that you could expect from any freelance bookkeepers. Even if the bookkeeper handling your books gets sick or takes a leave, there will be other employees that can fill in the shoes, and look after your books.
Firms usually have employees that vary in experience and qualifications. A bookkeeping firm may have beginners as well as experts, so the prices may also vary. However, you need to make sure that a certain quality is ensured, and is not compromised at any cost, depending from person to person.
How to find a good firm?
You can start by looking up bookkeeping firms that operate in your area on Google, and start your research from there. You can review the options to find the best fit. You can also ask for references from similar clients so you can get honest reviews and find an established firm for your business.
Choosing a remote bookkeeping solution
Online bookkeeping solutions (like MyCountSolutions) use cloud-based software to do your books for you, finding the right bookkeeper for your needs. It works like a bookkeeping firm. However, it is a more affordable solution, since automation cuts down the cost of manual work. It is an affordable and much better choice for small businesses that do not have cash-heavy transactions.
Remote bookkeeping solutions generally charge a flat monthly fee depending on the number of your accounts and the complexity of your needs. For example, MyCountSolutions charges $325 per month for 3 accounts for complex bookkeeping needs. It also offers a discount if the fee is pre-paid annually. It offers multiple packages, taking into account loans, merchant processors, and lines of credit. They also offer a free one-month trial, providing you with completed books and an insurance statement at the end. Remote bookkeeping is a much more affordable option for small businesses that have a relatively straightforward financial system.
Remote bookkeeping solutions may include a custom app that allows you to message the bookkeepers directly, or you can reach them by email. These solutions are able to automatically import your financial information like credit accounts and transactions or you may need to scan and submit physical receipts.
You should also consider if the bookkeeping service works with accountants. MyCountSolutions, for example, works with both bookkeepers and accountants and can handle not only your books but also do your taxes for you and help with audit representations.
Remote bookkeeping solutions have multiple employees, like any bookkeeping firm. So you don’t have to worry about any service gaps with a remote bookkeeping solution either. These services are equipped to manage any unexpected surges in the workflow, particularly during the end of tax season when the burden is all on the bookkeepers to close the books.
Remote bookkeeping services like MyCount Solutions guarantee a certain level of quality. They have certified and trained bookkeepers and accountants that receive ongoing training and keep updating their qualifications to provide the best quality services. Let the pros at these services handle your books and keep them up-to-date according to the IRS standards.
Hiring the best bookkeeper for your firm is the first step towards understanding your business and planning to expand it further. The next step toward growth is finding an accountant that can use the information provided by bookkeepers to make informed decisions regarding long-term business planning.
How much does a CPA cost in 2022?
The Journal of Accountancy conducted a survey showing that an average CPA costs $119,000 per year, whereas the cost for a fresh CPA was $66,000. A CPA with more than two decades of experience costs $152,000 per year. The rates of a CPA depend on the size of the firm as well as the level of experience. Smaller businesses pay their CPAs $30 to $50 an hour. With the increase in inexperience, the wage also increases from $40 to $80 an hour. A CPA junior staff member costs $60 to $120 an hour. Senior staff members and supervisors ask for $100 to $200 per hour. If you become an owner, the wage becomes very hefty and increases up to $200 to $250 an hour. In major cities, and experts, the hourly rate goes up to $500. CPA owners make significantly more than non-CPA owners and the difference can range from $20 to $100 an hour. In the US, an average CPA charges slightly under $30 ($28.65) per hour. CPAs with additional qualifications can charge a little extra.