Posted by Shivali Anand
March 21, 2022 | 4-minute read (655 words)
Accurate, up-to-date financial documents are crucial to your business’s performance. However, as a business owner, your time is better spent on revenue-generating activities than entering data in a spreadsheet.
While some small business owners perform their own bookkeeping, this time-consuming task can also be safely delegated to a reliable bookkeeping company. Such firms not only maintain track and manage your financial information, but they also keep it secure by using cutting-edge technology.
What is the role of an outsourced bookkeeper?
Your business’s accounts can be prepared and its daily financial activities tracked by a well-trained outsourced bookkeeper. The bookkeeper's job is to provide error-free, current financial information about your company. Here are five tasks that an outsourced bookkeeper can do for your business on a daily basis:
• Keep track of daily transactions by extracting information from source documents and entering journal entries into accounting software.
• Reconciliations, by balancing bank accounts and verifying the general ledger to ensure financial data is appropriately recorded.
• Data entry, such as entering the financial information needed to execute payroll and keep track of debits and credits; changing employee tax withholdings and wage rates ensure that net pay is computed accurately.
• Handle accounts payable and accounts receivable to ensure suppliers are paid on time and collections are received on time.
• Report production, to ensure that corporate executives' financial statements and other reports are correct.
Why do you need to employ a bookkeeper?
As your business grows, so too will the number of financial transactions it conducts. As a result, financial recording, analysis, compliance, reporting and cash flow management will demand additional time and skills. Outsourcing to a professional bookkeeping firm is one way to check such items off your to-do list.
Top nine reasons companies should outsource bookkeeping:
1. Preparation of accurate financial accounts and reports. Investors, tax preparers, banks and others looking to evaluate your company's financial position data will benefit from your outsourced bookkeeper's monthly or quarterly financial statements and reports. These precise financial reports will also help you make informed judgments.
2. Promotes expansion and growth. You can scale resources up or down, depending on your business's demands, by outsourcing bookkeeping services. You will only be charged for the work that is completed. The outsourcing company can also supply more hours or even more workers to fulfill your needs immediately.
3. Improves data security. Your outsourced bookkeeping staff will use the latest technology to keep your financial information secure, reducing the chance of your books being tampered with.
4. Makes data more accessible and easier to review. Financial documents such as credit card statements, bank statements, payroll records, profit and loss reports, balance sheets and invoices will all be kept in one place by your bookkeeping specialist. This makes it simpler for you to go over your financial records.
5. Ensures timely payment and collection. The bookkeeper keeps track of your daily transactions and performs reconciliations to ensure your records are correct and up to date. This ensures you pay vendors and collect payments on time.
6. Reduces overhead. You don't have to pay employees when you don't need them if you use an outsourced bookkeeping service. You can also avoid spending money on new bookkeeping equipment and software. Finally, you won't have to recruit someone in-house to fill the position.
7. Maintains a compliant, up-to-date accounting system. An outsourced bookkeeper knows about state and federal regulatory changes that may affect your business now or in the future.
8. Provides access to expertise and new technology. Outsourcing bookkeeping services provides you with access to a team of highly qualified and experienced experts that employ advanced technology and processes to guarantee that your data is correct and safe.
9. Boosts productivity. Outsourcing bookkeeping chores can relieve your employees of time-consuming and repetitive back-office labor. Therefore, you can allocate more resources to revenue-generating activities like marketing and outreach to new clients, resulting in a greater return on investment.