When Should You Hire a Bookkeeper?

Are you thinking of hiring a bookkeeper but are up in the air whether you might need one? It can be a tough decision to make, especially as a smaller business owner who has been managing their own finances. We’ll lay out a few pros and cons of hiring an accountant or bookkeeper to help you make an informed decision.

Bookkeepers vs Accountants – What’s the difference?

First of all, it’s important to distinguish bookkeepers from accountants – they are not one and the same as people might assume. To put it simply, bookkeepers are in charge of the day-to-day financial tasks such as recording and organising financial information. This may be in the form of bills, receipts, invoices or any transactions. They will also usually assist with

• Inventory management
• Update accounting software
• Process payments and reconciliations
• Prepare balance sheets and financial statements
• Manage payroll
• Keep the business regulation compliant.

Accountants, on the other hand, will normally take care of bigger picture tasks such as

• Preparing tax returns
• Monitoring cash flow
• Business and finance forecasting
• Produce financial reports
• Provide financial guidance, support and direction (Paro 2022).

So how do you know when you need a bookkeeper?

There are some common tell-tale signs to look out for that might indicate your daily accounting is becoming overwhelming. This can oftentimes come when work is picking up for small and medium sized businesses and those who were previously in charge of finances have too much of a workload or they aren’t prepared to deal with the volume of financial work.

• Bookkeeping is taking up more time and compromising on the work you put into other aspects of the business
• Your books just simply aren’t adding up
• You always seem to be behind on your bookkeeping
• If you have an accountant, they may start to take care of your books
• You begin receiving financial penalties.

Is outsourcing bookkeeping the way to go?

Now that you understand what a bookkeeper does exactly and when you might need one, lets go through some of the pros and cons of outsourcing your bookkeeping.

Pros

• You’ll most likely save money with a good bookkeeper as you’ll be able to spend more time on business development.
• With an experienced bookkeeper, you’ll be able to get regular, up-to-date, expert advice on financial decisions and the most appropriate next steps for your business.
• Most importantly, if you were a business owner working evenings and weekends to keep up on your accounting, you’ll have a better work-life balance and save a lot more time.

Cons

• Depending on the bookkeeper you work with, you might not be able to have much visibility or control over your books the way you did before. However, you’ll always have a chance to look them over at the end of the week or month – depending on how you set up meetings.
• The same way you might make a mistake with your books, your bookkeeper can too – make sure to double check their work and hire someone with a good track record.
• Giving out financial information to a stranger can be a very difficult decision. Hiring an external bookkeeper can seem daunting for business owners and for this reason, we cannot stress enough the importance of working with someone you can trust. Talk to previous and current clients of your bookkeeper to find out how they work and whether they are the right fit for your company.

At Sllick, we created our Virtual Finance Team to compromise of multiple experienced employees at all levels to take care of your bookkeeping and accounting needs. We move all of your financial processes to the cloud accounting software, Xero, in order to automate data entry and give you the option to check your accounts whenever, wherever you would like.

Imagine having peace of mind knowing that you are always up-to-date with all financial records, knowing exactly what’s going on in your business and allowing you to focus on your customers and growing your business. Our team of qualified accountants ensure that you are always on top of things. We don’t just crunch the numbers, we actively get involved in your business to find better and more efficient ways to help you reach your goals, no matter where you are on your business journey.

Book a free discovery call with Sllick now and see how your business can make the most of your books. We arm you with the knowledge to get things right, from the start!