As an entrepreneur, you may pride yourself on your ability to handle every aspect of your business on your own. In this difficult economy, many business owners feel compelled to do it all themselves, never giving in and hiring outside help until they absolutely must. Paying a bookkeeper or accountant can really present a hurdle to entrepreneurs, both for reasons of finance and pride.
The plethora of financial software, like QuickBooks, available to business owners makes many of those owners feel like they both can and should handle their financial records independently. However, many entrepreneurs lack the time available to properly address tracking their finances or aren’t really sure whether they are doing it accurately. Even if you are dealing with basic accounting tasks, those tasks are eating up time that you could be devoting to working on your business. As your business grows, accounting will surely become more complicated.
Unfortunately, many entrepreneurs who bite the bullet and hire a bookkeeper discover that they weren’t managing the books as well as they thought. It is common for a business owner to discover that they save money by hiring a bookkeeper because records are kept properly and mistakes are eliminated.
So how do you know if you need a bookkeeper or an accountant or even both? Think of it as being similar to hiring an architect and a carpenter to build a house. While both a bookkeeper and an accountant handle financial matters, they have different tasks. An accountant looks at your financial picture as a whole. She prepares important financial documents, like profit and loss statements. She prepares your taxes, and offers advice. Your accountant might also serve as a chief financial officer for your business and offer advice pertaining to your financial strategy.
On the other hand, a bookkeeper handles the daily responsibilities related to the financial side of your business. This can include tracking employee paperwork for payroll, submitting and tracking invoices, and paying bills. It also includes keeping track of company expenses and entering them into your financial software.
When a new business starts up, the owner is sure to be quite busy. It is easy to let record keeping slip, but it is important to track your finances carefully during this time (and any time). It is wise to hire a bookkeeper early in the process, even if only for a few hours a week or one day per month. As your business becomes more stable, you can start to examine your financial trends and develop a strategy.
Small business owners often use the services of their accountant only at tax time. If you are working closely with a bank or trying to obtain credit, you may need to speak with your accountant more often.
For many small businesses, a part-time or outsourced bookkeeper and accountant are sufficient for quite a while – often until the business has 30+ employees or has surpassed the $1 million revenue mark. Prior to that point, a business usually cannot support a full-time bookkeeper or accountant. However, if you find that your part-time bookkeeper can’t keep up with the workload, it may be time to consider employing a bookkeeper full-time. A flexible solution like part-time or outsourced bookkeeping and accounting services can be just what your small business needs.
Acceler8 provides business advice, tax and accounting services, and bookkeeping services. If your small business could benefit from a bit of assistance with bookkeeping and accounting, contact Acceler8 today. With Acceler8 on your team, you can enjoy your role as a small business owner and achieve great results.