Managing a small business is no easy task and managing the finances can be a small headache. Bookkeeping is definitely not the favorite task of most small business owners, though it is an important factor in the success or failure of the business. Knowing where you stand at any instant gives you the information you need to make decisions that can help your business grow or prevent you from making a bad one that ends in failure.
1. How does a small business benefit from professional bookkeeping?
An educated professional bookkeeper understands how to properly log and categorize expenses. They have enough experience to quickly turn a pile of receipts, bills stubs, and sale sheets into a detailed financial statement that lets you see exactly where you have been and focus on where you are going. The most successful business owners learn how to delegate tasks to the most qualified person. This creates efficiency. Too often they spread themselves thin and try to be everyone and everywhere in their company. This does lead to mistakes or overlooking things at key moments. A professional bookkeeper can take this one thing off their hands and are trained to see little things a small business owner may overlook financially and alert them before it is too late.
Keeping the books up to date between tax time will enable you to know exactly where your business is going before tax time, and take necessary steps to prevent an audit or pay penalties. Hiring a professional bookkeeping service will help prevent the IRS from making a disaster of your life and small business IF they should decide to do an audit. The professional bookkeeping service has detailed records for the IRS which will help you look better during audit time.
2. Can you afford professional bookkeeping service?
The cost of a professional bookkeeper is probably the biggest obstacle for a lot of small businesses. If you are just starting out most likely you do not need and cannot afford a full-time bookkeeper. I recommend that you at least become familiar with a local bookkeeper that can help you if and when you need it. Rates vary greatly and a lot of times you get what you pay for.
3. Is financial software just as good as a professional service?
It can be. There are hundreds of accounting software systems to choose from and choosing and learning a new accounting system can be daunting. However, a professional service has more experience and can do so more efficiently than small business owners who are already trying to fill many hats on the job. If you are determined to prepare your books in-house, one option is to pay an outside bookkeeping service to train you or your staff on how to use an accounting system and review your books regularly for accuracy.
Just like we would call a service to fix the plumbing, paint and decorate, and do electrical or carpentry, so too a professional bookkeeping service is the best financial assistant for the job. They can keep it under control, keep detailed records, and do so efficiently enough to keep IRS from giving you trouble. No more cluttered desks with paper work or long hours in the office after the shop closes just to know where the business has been and where it is going at a moment’s notice. As a small business owner, hiring a professional bookkeeper may be the best decision you could ever make.