In any business, it’s important for you to monitor your cash-flow so that you can avoid any misuse of funds. Some business owners decide to manage their own books, while others prefer to hire a professional bookkeeper to do it for them.
Although there’s nothing wrong with doing the business accounting all by yourself, it can be time-consuming and tiresome. However, hiring a professional bookkeeper enables you to focus on running your business, while the bookkeeper manages your finances. Other reasons why you should hire a personal bookkeeper are as follows:
A different point of view
A professional bookkeeper may notice an area of opportunity that you wouldn’t normally notice. This scenario happens because we are often biased towards certain things, and you need a second opinion to realize it.
For example, a professional bookkeeper will keep records on individual vendors. If your firm uses a certain vendor because you loved their services, you may not realize they have become more expensive than others. A bookkeeper may notice this anomaly and inform you before you lose more money. If you feel like being biased is really impacting your business, take a look at this great read I found on overcoming your biases.
This point may come as a shock to you, especially if you believe that bookkeepers are expensive, but it’s true. A professional bookkeeper will help you save money. First, your bookkeeper doesn’t have to be a permanent employee. You can have them on call when you want to file your tax returns or when you wish to balance your books of account.
Since the bookkeeper is not a permanent worker, you don’t have to pay their payroll taxes or offer them employee benefits. In addition, since you remunerate the bookkeeper when you call him or her, your labor costs are less than if you had hired him or her on a full-time basis.
Guarantees smoother flow of operations
As a business owner, you want your firm to operate at maximum efficiency. With employees, you are never sure when one of them might decide to quit, leaving your business with a deficit.
For example, if you have an internal bookkeeper, and they decide to leave your firm because they got a better offer, your business is put at risk. Since there’s no one to manage your finances, creditors don’t get their money on time and you fail to keep track of debtors, hence losing money in the process. However, with an external professional bookkeeper, you don’t have to worry about quitting since he or she is not your employee, instead, he or she is your business partner and would typically give 30 days notice should that partnership need to end.
When your business is doing really well, it could present the opportunity to open more branches and hire more staff to handle the increased demand for your goods and/or services. Usually, it takes extensive time to make such changes. Luckily, you don’t have to restructure the finance department when you have a professional bookkeeper. Normally, professional bookkeepers do the reshuffling themselves since they understand what’s at stake.
As your professional bookkeeper budgets and keeps track of the accumulating cash every month, you will have more flexibility because you have cash on hand for expansion or new projects.
Financial transparency is so important to businesses that often lack the collateral that would be required for a loan. Whether it’s an investor or a financial institution, they are more likely to lend money if your financial records are up-to-date. To them, detailed balance sheets and income statements are a sign of transparency.
Who can benefit?
If you are a business owner or a manager, hiring a professional bookkeeper will help you to keep track of your tax records and to use your time more efficiently for other things. In addition, a professional bookkeeper can help you identify money-making opportunities for your business.