The very short version of this article goes something like this:
Do you have a business? If yes, then it should have a bookkeeper!
Let’s have a look at how to tell if you need a bookkeeper for your business, plus a few reasons why you probably should already have one.
Firstly, it’s important to remember that a bookkeeper and an accountant are different (although many can perform both services). Your accountant may only be essential a few times a year. A bookkeeper on the other hand works with you on an ongoing basis to track your everyday finances (and does not charge accountancy fees).
Having a good bookkeeper will make your financial records perfect for when you do need an accountant, and will also save you GREATLY on what your accountant will cost.
How can I tell when my business is ready for a bookkeeper?
You can arrange for a bookkeeper for your business, or you can do your bookkeeping yourself.
You can’t however avoid bookkeeping entirely – you must document what comes in and goes out of your business’s finances, and you MUST report income to the ATO. So if you have been hiding completely from bookkeeping, now is definitely the time to look at it.
Many people can and do manage their own books. If it is fairly straightforward, not time consuming and you have a bit of a head for numbers, then DIY-ing makes sense. However as soon as it starts to take up too much of your time, gets too complicated or becomes too stressful, then your business is ready for a bookkeeper.
A small business with few customers or transactions may be able to look after it’s own bookkeeping. Very early on you might feel that you don’t have the budget to pay for a bookkeeper. But as soon as you start to grow a little and have more incoming and outgoing transactions, you should seriously consider a bookkeeper, even part-time or for a few hours a week.
Is managing your business financials more than you can or want to handle? Then you are ready for a bookkeeper.
Are you concerned that anything is getting missed? Do you feel like there are probably ways to save money that you don’t know about? Then you are ready for a bookkeeper.
6 signs that you need a bookkeeper
- You are spending time on your books that would be far better spent on another part of your business (or with your family)
- You can’t keep up with logging all of your business transactions and are starting to fall behind
- You suspect that you aren’t keeping your records accurately
- Your tax reporting requirements or payroll are getting too complicated for you to focus on properly
- You are losing money on outstanding invoices or from your own late payments
- Stressing about your figures is keeping you from focusing on your business or enjoying your life
Why should I already have a bookkeeper for my business?
A bookkeeper will be more efficient and more accurate than you at keeping your books on track. They will likely understand better than you what all your reporting needs are and will make sure that things don’t get missed.
They also will focus 100% on your books, which means you don’t need to, and you can then look more at the creative, marketing and people sides of your business (or whatever you want to focus on…)
A bookkeeping service costs less than you think and makes more financial sense than you realise. Your bookkeeper will be responsible for tasks like:
- Recording your customer invoices and also payments
- Making sure vendors are paid
- Managing cash flow
- Reconciling your bank accounts
- Managing your loans
- Managing your tax reporting
- Making sure your staff are paid
- Advising on ways to save money and increase cash flow
Many will provide their services virtually, meaning you don’t need to meet with them physically. This is very helpful if your time is tight and if you run your own business from home.
Most will use accounting software that stores information in the cloud and allows you to access whatever you need in real time and wherever you are working from.
Because compliance is key
Your financial and compliance obligations will change with time, and the government also changes them frequently just to keep us all on our toes.
You will have requirements in terms of insurance, Workcover, staffing, superannuation, tax reporting and more – and the goalposts often shift. A bookkeeper will make sure that you keep kicking the goals no matter where those pesky goalposts run off to.
What do I need to do to get my business ready for a bookkeeper?
If you are just starting out in business, or have been in business for a while, but are just starting to get your head around the bookkeeping side of things, check out my article here for tips.
You can meet with a bookkeeper for your business without having done anything to get your books ready for her, but you will save her and yourself some valuable time if you get a few of your ducks in a row before meeting.
- Your TFN and ABN
- Collecting together your figures for incoming and outgoing expenses, and ongoing costs like loans or insurance
- Find your most recent BAS statements and tax reports
- Putting together details of your employees, wages, etc.
- Writing a list of questions that you would like your bookkeeper to clarify for you
You could also find out what accounting software program your bookkeeper recommends, and start putting your information into it.
If you are ready to chat about outsourcing your bookkeeping needs and what this could mean for the growth of your business (as well as your bottom line), book in a chat with us today.