A bookkeeper is someone who keeps track of all the financial transactions of your business. They organize, collect and record all the financial data in general ledgers. This includes sales, purchases, payments, receipts, etc. All these are recorded in a standard way so anyone with accounting knowledge can access them.
Most small business owners try to do bookkeeping on their own. As your business grows, you will find it hard to manage bookkeeping and your day-to-day operations. Eventually, you will get to a point where you have to hire a bookkeeper.
Hiring a dedicated bookkeeper will help you get a huge load off your head. Bookkeeping can take up a lot of your time that you can allocate for other productive tasks. As a business owner, your time is much more valuable than you think. Working too much and not focusing on yourself can lead to burnout. Improper bookkeeping can cause pile-ups, making it even harder to close your books monthly.
When to hire a Bookkeeper?
Here are a few scenarios that you might come across that defines when to hire a bookkeeper.
Lack of time to manage your books
As mentioned above, most business owners work overtime. They often tend to do everything by themselves, including bookkeeping. Time is money. Rather than spending your valuable time on time-consuming bookkeeping, you can use this time to focus on growing your business.
When you keep missing documents.
Categorizing each transaction is not as easy as it sounds. You need immense attention to detail and knowledge to categorize and record all the transaction to keep your books accurate. This will help you optimize your cash flow and get maximum tax deductions. You also need to take care of all your transactions on a regular basis. Saving everything for later can cause huge troubles, you will be running around for invoices during busy tax season in case you miss them.
When your books are not up to date.
It is hard to understand your actual financial position without accurate books. It is almost impossible to understand where your cash comes from or where it goes. You won’t be able to understand how much money your business is making which is necessary to understand your financial health.
It can get much worse during tax season, you will have a tough time catching up with your books. Tax season has always been a tough time for business owners. Searching for receipts and other data during this season is the last thing you need.
Stressful Tax season
Tax season can be pretty easy If your books are intact and you close your books every month. It easy for your account to prepare financial statement and file your taxes. They can get the best out of your financial data to get you maximum deduction and you won’t have to worry about penalties or IRS audits. Most business owners who do bookkeeping on their own doesn’t have enough knowledge about various tax regulations and compliances. Hiring a good bookkeeper would really help you save money.
When your business isn’t growing
Accurate bookkeeping is foundation of preparing financial statements. Financial statements are essential to make proper business decisions and understand your cash flow. This is the key to understand your financial health of your business and take necessary actions to grow your business. It will get you an in-depth understanding on how well your business is doing and take necessary actions like increasing production, cutting down unnecessary costs, new investment opportunities etc. Hiring a bookkeeper is the basic step to guide your business to growth.
Are you a business owner who ever came across any of these scenarios? Do you ever felt like you need more time for yourself? If yes, let us help you out!
We can take care of your books and be up to date with your financials. You won’t have to worry about busy tax season and late payments anymore. Get in touch with us to know more about our bookkeeping solutions.