How to Decide if you Need a Bookkeeper or Accountant
Most small business owners don’t consider themselves superheroes even if they act like one on a daily basis. The typical small business owner has countless things to do and few resources to help do them. Despite this deficit of time and resources, small business owners may try to perform heroic feats that can tax their time and energy.
Managing bookkeeping is a great example of a heroic feat that small business owners may take on, even when they might be better served by getting help. Filing your receipts, tracking expenses, maintaining up-to-date records of business transactions, and reconciling your bank statements are all necessary but “noisy” bookkeeping tasks that will demand your attention on a regular basis and distract you from the activities that will make your business successful such as developing new products and launching new marketing campaigns. Resist the siren call of these “noisy” tasks that take up time but don’t add much value. Don’t be a superhero. Step back and ask for a little help.
It’s no sin to get help, especially when it comes to your business and your future. After all, even the best superheroes team up when they need help. Many small business owners manage their own books in Excel. Invoices may sometimes not be recorded and bills might get paid late. A little help can help you avoid mishaps or prevent you from overlooking responsibilities.
You may have kept your own books when your business started and you probably got used to doing this in addition to actually running your business. But are you doing your books right? Are you spending more time on them rather than running your business?
Do You Need a Bookkeeper?
The good thing is you can get get help with financial tasks and often at affordable rates. An experienced bookkeeper can help you:
- Process paperwork and set up a secure physical or digital system for processing source documents such as receipts and invoices. Keep in mind that a small business may need to keep records for individual transactions for years in some cases.
- Record transactions: A bookkeeper can make sure that transactions are posted to the right account and not mis-categorized.
- Check for errors periodically – This will save you some real headaches come tax time!
- Focus attention on imminent financial issues so that you can take action.
A bookkeeper will organize your business, catch errors, and allow you to think strategically. It can be a great way to see a quick return on investment and you’ll probably love not having to do the bookkeeping any more!
Do You Need an Accountant?
Poet T.S. Eliot wrote that “April is the cruellest month.” It’s especially cruel for small business owners, who are subject to the same tax filing deadline as everyone else. You can lessen April’s sting, however, by hiring an accountant to help you prepare for the tax season well in advance. The benefits of having an accountant will stretch far beyond April, too. An accountant frees up time and energy that you can deploy in other areas of your business.
Accountants are more than just paper-pushers and number-crunchers. They can also function as experts and trusted advisors. Think of Professor X from the X-Men. He helped his students master new skills and your accountant similarly can help you to:
- Understand your financial statements – These days, applications like QuickBooks can help the typical small business owner quickly and easily prepare a balance sheet, cash flow statement, or income statement. Interpreting these financial statements is another story. An accountant can guide you through the implications of these documents and help you make adjustments if necessary.
- Make you Money – Accountants often know some interesting tricks of the trade A great example is quarterly taxes. Often businesses think they only have to pay annual taxes and then get fined. An accountant might help you save hidden costs like that. But they can also help you find tax deductions that can put more money directly in your pocket.
- Network in the Local Business Community – This next point may seem obvious but it’s often overlooked. Most accountants are tied deeply into the business community. Because of this, they can recommend useful contacts or suggest partnerships that can help your business in the short and long term such as investors, advisors or partners.
As you can see, the benefits of an accountant are plentiful and go beyond tax preparation. An accountant can be a valuable advisor for a small business while also keeping an eye on the finer details of your business’s financial position. That’s valuable whether it’s April, May, or December.