Hiring a professional bookkeeper can bring great help with maintaining up to date records, accuracy therefore lowering the risk of error and complying with the latest legislation.
It takes time to sort through invoices, receipts, bank statements etc etc then the additional task of entering the data and making sure it all balances and reconciles. But many business owners do not know or have the time to find out how their business is performing, running management accounts, budgets and cash flow forecasting.
The question is do I employ internally or outsource?
While taking on an employee to take over bookkeeping may seem like a good way to keep control of your finances and the people managing them, this method often falls short in accomplishment. For businesses without a knowledge in managing bookkeeping procedures, accounting software or financial analysis, managing bookkeeping internally can be a recipe for disaster.
Additionally, in many situations, internal bookkeeping staff can be subject to myriad of information, security, fraud or even simple errors or mistakes in financial entries. From repurposing office admins to mismanaging employees, having an internal bookkeeper requires a lot of oversight.
What kind of qualification and experience does a freelancer have? The answer varies greatly from one worker to the next. You want to ensure your bookkeeper has professional training in the field, along with relevant experience and a good track record. Certification, licensing and insurance should all be investigated. If a freelancer makes a mistake while working for your business and doesn't have liability protection, you'll likely be left holding the bag. In addition, if your freelancer is working off-site, say from a home office, you'll have to find a way to provide adequate oversight in order to prevent account mismanagement and mistakes.
Competent freelancers exist, but you'll have to be diligent to find the right one for your business. Your bookkeeper needs to be able to balance your books and provide insight both on problems you're experiencing now, and those you may come across in the future. To be effective, they'll also need to use resources that are compatible with the software and payment tools you already have in place.
Finally, there are bookkeeping service companies that manage daily accounts for multiple businesses. Because they work with a variety of clients, these services often have access to a wider range of tools, and because they employ so many people, they have a better chance of having the experience needed by your business. Additionally, leveraging connections to industry experts and accounting technology companies can provide extra benefits to businesses.
Hiring a bookkeeping service to manage your accounting needs can help you identify potential risks and opportunities, in addition to simply ensuring the integrity of your financial data. Even the smallest business owner can often benefit from their help and advice. Unfortunately, not every solution is profitable once put into practice. Protect your business by taking time to find and hire the right bookkeeping partners.
Thank you to our article writer Heather Okines MAAT - Owner/Director at Fairbook Business Services