If you’re reading this, you are probably a business owner (or soon to be) who is looking to stay organized and set their organization up for success. In this blog post, we will aim to cover the following questions:
1. What is a bookkeeping service and what do they do?
2. How can a bookkeeping service help your business save money and time?
3. What are the benefits of using a bookkeeping service for your small business?
4. How much does a bookkeeping service cost, and is it worth the investment?
5. Should you hire an in-house bookkeeper or use a third-party service provider?
6. How to find the best bookkeeping service for your small business needs
What is bookkeeping?
In its simplest form, bookkeeping is the act of tracking and recording your businesses financial transactions. This is inclusive of all inflows and outflows, for the purpose of financial organization and actionable insights, as well as tax and legal compliance.
What do bookkeeping services provide?
A bookkeeping service is a professional that provides these services to businesses of all sizes. Bookkeepers will often work with accounting software, in order to maintain records that are accurate and up-to-date. This allows business owners and managers to focus on more important tasks, safe in the knowledge that their finances are being well looked after.
The main duty of a bookkeeper is to keep track of all money coming in and going out of the business. This includes sales, purchases, payments, receipts, and invoices.
A bookkeeping service will usually offer a comprehensive set of financial tracking and recording services for businesses, which can be customized to your specific needs. This might include daily, weekly or monthly financial tracking, invoicing, expense management, bank reconciliation, accounts receivable/payable and more.
A good bookkeeping service will benefit you in a multitude of ways:
Firstly, a professional bookkeeper eliminates errors made in the process of tracking your finances. This leads to increased transparency into the financial health of your business, and allows you to take well thought out, data-driven decisions.
Secondly, having an accurate record of your inflows and outflows while working with a bookkeeper will allow you to maximize your tax deductions at the end of the year.
Due to the fact that you have been tracking every transaction and using that data to make informed decisions, you will be able to maximize the deductions available to you at the end of the year for all qualifying business expenses.
When you outsource your bookkeeping to a professional service, you free up valuable time that can be better used to focus on other areas of your business. This is especially beneficial for small businesses and startups who often don’t have the bandwidth to take on all financial responsibilities in-house.
Imagine actually being able to focus on your business without the headache and hassle of keeping tabs on all of your receipts. Or, having to scramble at the end of the year to get your books in order for taxes.
With a bookkeeping service, all of that can be taken care of quickly and easily so that you can focus on what you’re good at – running your business!
Make better informed decisions
The primary benefit of accurate financial tracking and reporting is making better, data-informed decisions. In order to make informed decisions, you need to have an accurate view of your business finances at any given time.
Below are a few of the reports you can expect to keep up with while working with a bookkeeping service:
· Income statement – also known as a profit and loss statement, this report will show you how much revenue your business is bringing in, as well as the costs associated with running your business. This will give you a clear picture of your net profits.
· Balance sheet – this report provides a snapshot of your businesses financial health by detailing all of your assets, liabilities and equity.
· Cash flow statement – this report tracks the movement of cash in and out of your business, and is used to predict future cash flow trends.
· Accounts receivable aging report – this report shows you how much money is owed to your business by customers, and how long those payments are overdue.
· Accounts payable aging report – this report shows you how much money your business owes to suppliers, and how long those payments are overdue.
Obtaining this comprehensive view of your finances will allow you to make well informed, data-driven decisions about the future of your company.
How much do bookkeeping services cost?
The cost of bookkeeping services will vary depending on the size and complexity of your business, as well as the specific services you require. For example, a small business with a limited number of transactions will likely pay less than a larger business with more complex financial needs.
To get an accurate estimate of how much bookkeeping services will cost for your business, it’s best to request quotes from a few different providers. Visit our bookkeeping page to set up a consultation with one of our experts today.