Why You Should Avail Outsourced Bookkeeping?
Last Updated March 7, 2022
Every business owner understands that up-to-date and accurate financial records are essential for the smooth running of any enterprise. When you start a business, you try keeping track of all your accounting; purchases, sales, and financial records but it gets harder the more your company grows. That is when business owners need to hire bookkeepers to work for them. Outsourcing your bookkeeping can ensure that you save your time and energy for the management part of your business rather than trying to keep track of the financial records. Outsourced bookkeeping can help you focus on the smooth running of your operations, helping you identify areas for improvement and opportunities to grow, meanwhile helping you relax by taking off the stressful job of tracking all the transactions.
3 reasons you should outsource bookkeeping services are:
If more of your time is being spent on bookkeeping than other business tasks
Multitasking, and repeatedly shifting between tasks can cost 40% of your business productivity time. If most of your time is being spent on tracking financial records, looking into payrolls, and other accounting services for your clients, it may be time that you outsource bookkeeping.
As a small business owner, if you aim to do it all by yourself, you are bound to either overwork yourself or find it hard to manage the whole financial system yourself. The hiring of undertrained or having an overworked staff can also lead to fiscal uncertainty, inaccurate financial data, and reporting. Your bookkeeping services need to be efficient and accurate in order for your business to progress forwards.
If you have a limited staff that you rely on for all important tasks, then it is time you consider outsourcing bookkeeping services so that the internal capability of your business can be formed from the ground up. You may think that things are working well enough at the moment but you might be missing out on an opportunity to take your business to the next level.
Your appointed duties are not separated
If the same employee is writing your checks and also reconciling the bank statements, it means your business lacks internal control and there is no separation of duties. This in itself is a huge risk for small business fraud.
Occasional frauds like tampering with billing and payroll fraud are a common occurrence within small businesses that do not have a system designed especially to reduce these risks. Organizations face up to $150,000 of loss per case owing to occupational frauds. Outsourcing bookkeeping services is one of the strategies that can help you stay clean of thieving employees and stay clear of fraud by adding an additional layer of review. It makes sure that the flow of information is valid and all the financial data is classified timely and accurately. It makes it easier to uncover any fraud happening in your business.
You are making business decisions without accurate and timely financial intelligence
Outsourcing your bookkeeping to an intelligible and qualified professional can help you keep a record of all your financial information and accurate provision of financial data can help you make informed decisions keeping in view all the available information and avoiding making any serious mistakes.
The Geneva business bank conducted a study which showed that financial planning on a monthly basis predicts a survival rate of 80% whereas those businesses that plan out their cash flow on an annual basis have a survival rate of 36% over a span of five years. Keeping a track of cash flow is very essential for making any business decisions. Cash flow forecasting is one of the reasons that you should outsource bookkeeping services.
Hiring professionals that are experts and specialists in their fields, that have the capabilities of using technology for their benefit, can provide you with a competitive advantage over other businesses while also reducing the costs of training and investing in technology that you may not have the best knowledge about. Outsourcing bookkeeping services can help you make strategic decisions based on timely financial reports ensuring that your business is better positioned to scale.
Outsourced bookkeeping ensures that your valuable employees are able to focus on their core jobs, facilitate clients and add value to the business. It not only improves performance measures and efficiencies but also helps you focus more on our clients, making sure your business is headed in the right direction.
Some other reasons you might have to outsource your bookkeeping are:
- Your financial records are never up-to-date
- Bookkeeping tasks are taking up more of your time than you can afford
- It is a struggle to stay on top of your cash flow
- You are missing out on tax write-offs
- Consistent reconciliation
- Backup and accuracy
- It is getting harder to track accounts receivable and payable
- You are unable to make your estimated tax payments
Types of outsourced bookkeeping services
There are three types of bookkeeping services that you can choose while outsourcing. These are:
A local bookkeeper is any individual or bookkeeping team that is based near your business.
You can either hire a freelancer available locally or a firm. Freelancers can work one-on-one with you and can be more flexible in meeting either in person or online and have varying levels of skills and experience.
A bookkeeping firm can offer assurances of certification that freelancers might not be able to provide. They also might charge more than a local freelancer. In case one bookkeeper might take a leave or quit, you will not be left hanging and some other bookkeeper will take over your records.
While hiring a local freelancer or firm, you just have to make sure that they are trustworthy and secure.
Some advantages of hiring a local bookkeeper are:
- You can meet your bookkeeper face to face whenever you want
- You can rely on physical records rather than using online banking or payment systems like Stripe
Virtual bookkeeping combines traditional bookkeeping and bookkeeping software. Virtual bookkeepers manage your books while using software to monitor your finances. It is a paper-free method of handling your books, only someone else is doing it for you. Some of the advantages of hiring a virtual bookkeeper are:
- Saves your time
- You can securely store your data on the cloud
- You can access your financial data anywhere anytime
- You don’t need to meet bookkeepers in person and can chat online
- Online banking saves you any hassle
Virtual bookkeeping can help you connect with clients via a secure online account and professionals that can gather your data and turn it into tax-ready financial statements on a monthly basis.
Traditionally it was common for business owners to hire in-house bookkeepers but with modern technology, it is a costly decision, especially for small business owners that were previously doing it themselves. If your business is growing rapidly and has advanced needs, you might need an in-house bookkeeper. You can hire a part-time bookkeeper if you cannot afford a full-time bookkeeper. Advantages of hiring an in-house bookkeeper are:
- Bookkeepers answer directly to you
- Efficiently handle the books for a larger business
- Available all the time
Benefits of outsourcing your bookkeeping
Outsourcing bookkeeping services has a number of advantages for all business owners. Some of these are:
Outsourcing bookkeeping services can free up valuable time that can be utilized for the company’s growth. Doing your bookkeeping yourself keeps you busy and conflicted with the multitude of other important decisions pending. Thus outsourcing bookkeeping can help you free your mind of a lot of distractions and save up your time.
Outsourcing bookkeeping services can save the money that you would spend on paying full time or part time wages and benefits to your employee. When you hire employees on a payroll, there are productivity costs that you need to spend on, which can be saved by outsourced bookkeeping; paying only for what you need.
Outsourced bookkeeping ensures that you have a specialist on your team that has the know-how about everything important, and is skilled, around the clock and you don’t even have to pay extra for it. When you trust an expert with your books, your job becomes a whole lot easier because you do not have to stress about tasks related to bookkeeping anymore.
The increased focus at work
Businesses that provide bookkeeping services provide clients with a better service by removing any distractions of the office from their work. Bookkeeping is hard to do when there is a hustle-bustle in the office all the time. Thus removing the job from the office helps increase focus on the business, not only for the bookkeepers but for you as well.
Individual vs team staff
Outsourcing your bookkeeping places your financial records in the hands of professionals that thrive on teamwork. One bookkeeper cannot keep track of all the financial transactions of a growing business and is unable to find subtle nuances that would help a company. Outsourced bookkeeping ensures that you have a team of members checking and double-checking the work of each member making sure that you receive the best possible services. This also helps in the separation of duties.
Access to top systems
Outsourcing bookkeeping services help you gain access to the top tools in the industry. The majority of the businesses are unable to afford expensive bookkeeping programs and find it extremely difficult to keep up with the changing laws and regulations. By outsourcing, you gain access to that knowledge and tools by proxy, and you don’t even have to do any work. These top systems also have organized books and nightly backups so if the IRS ever comes knocking for an audit, you will be prepared for it.
Outsourcing bookkeeping services allows you to cut back and expand at any time. You can easily cut down on spending, or if you want to expand your business, you can do so with the team of experts at your side that is there to provide the best opinions and options for you to achieve your goal. Outsourced bookkeeping services increase flexibility by providing scalability options that you would not have otherwise.
How can My Count Solutions help?
Bookkeeping experts at My Count Solutions optimize the process for you and manage finances, prepare financial statements and file your taxes for you. Bookkeeping services are provided to you at a fraction of the cost in an easy and efficient manner. At MyCountSolutions, the services offered are:
Run business smoothly
Zero tax filing stress