Whether you’re navigating estimated taxes as a business owner, seeking financing, or simply trying to get a clearer picture of your company’s financial health, there often comes a moment when the need for professional bookkeeping becomes apparent. This article aims to shed light on this crucial decision, exploring the ins and outs of bookkeeping and helping you determine if professional bookkeeping services are right for your business.
Too Long; Didn’t Read
- Bookkeeping is the recording and organizing of financial transactions in a business.
- Bookkeeping services include several key tasks: recording transactions, reconciling bank statements, managing accounts receivable and payable, and generating financial reports.
- The size of your business, service level you need, frequency, and location can all impact the cost of bookkeeping.
- If you spend too much time on bookkeeping tasks, have missed important financial deadlines, are not confident in the accuracy of your records, or do not understand your business’ financial health, you should consider hiring a bookkeeper for your business.
- JBS Corp offers comprehensive bookkeeping services for businesses around the country.
What is Bookkeeping?
Bookkeeping is the systematic recording and organizing of financial transactions in a business. It’s the foundation of the accounting process, providing the data necessary for preparing financial statements, tax returns, and making informed business decisions.
The Basics of Bookkeeping
Bookkeeping involves several key tasks:
1. Recording transactions: This includes sales, purchases, receipts, and payments.
2. Reconciling bank statements: Ensuring your records match your bank’s records.
3. Managing accounts receivable and payable: Tracking money owed to you and bills you need to pay.
4. Generating financial reports: Creating balance sheets, income statements, and cash flow statements.
What is Double Entry Bookkeeping?
Double entry bookkeeping is a fundamental concept in accounting. In this system, every financial transaction is recorded in at least two different accounts. For example, if you make a sale, you would increase your sales account (credit) and increase your cash or accounts receivable (debit). This method ensures that your books always balance, providing an accurate picture of your business’s financial health.
What is Virtual Bookkeeping?
Virtual bookkeeping, also known as online bookkeeping, is a modern approach where bookkeepers work remotely using cloud-based software. This method offers flexibility and cost-effectiveness, allowing businesses to access professional services without the need for on-site staff.
Companies like JBS Corp exemplify this approach by leveraging Xero, a leading cloud-based accounting software. As a Xero platinum partner, we use this platform to provide real-time financial insights and offer seamless collaboration between our bookkeepers and clients. This use of advanced technology enables JBS to deliver efficient, accurate, and accessible bookkeeping services, regardless of geographical location, while giving business owners a clear, up-to-date view of their finances at any time.
Thanks to Xero, JBS Corp can service clients around the country!
How Much Does Bookkeeping Cost?
The cost of bookkeeping services can vary widely depending on several factors:
1. Business size and complexity: Larger businesses with more transactions generally require more extensive services.
2. Service level: Basic bookkeeping will cost less than full-service accounting.
3. Frequency: Monthly services are typically more cost-effective than quarterly or annual services.
4. Location: Rates can vary based on your geographic location.
On average, small businesses might spend anywhere from $300 to $2,000 per month on bookkeeping services. Freelance bookkeepers often charge between $30 and $90 per hour, while CPA firms might charge $200 to $400 per hour.
When considering cost, it’s important to weigh it against the potential savings and benefits. Proper bookkeeping can help you avoid costly errors, identify areas for cost reduction, and potentially save on taxes.
What is Included in Bookkeeping Services?
Bookkeeping services typically include:
1. Transaction recording: Documenting all financial transactions accurately.
2. Bank reconciliation: Matching your books with bank statements to ensure accuracy.
3. Financial report preparation: Creating essential reports like balance sheets and income statements.
4. Accounts receivable and payable management: Tracking incoming and outgoing payments.
5. Software management: Setting up and maintaining accounting software.
Some bookkeepers may offer additional services such as:
- Budget creation and monitoring
- Cash flow forecasting
- Financial analysis and advice
- Inventory tracking
- Loan packaging (preparing financial documents for loan applications)
When choosing a bookkeeper, it’s important to clearly understand what services are included in their package and what might incur additional fees.
Who Needs Bookkeeping Services?
While every business can benefit from good bookkeeping practices, certain situations make professional bookkeeping services particularly valuable:
1. Growing businesses: As your company expands, financial management becomes more complex and time-consuming.
2. Businesses seeking funding: Lenders and investors require accurate financial statements.
3. Companies in highly regulated industries: Some sectors have specific financial reporting requirements.
4. Businesses struggling with cash flow: Professional bookkeeping can help identify and address cash flow issues.
5. Entrepreneurs who lack financial expertise: If finance isn’t your strong suit, a bookkeeper can provide valuable insights.
6. Businesses preparing for tax season: Organized financial records make tax preparation much easier.
7. Businesses facing an audit: Professional bookkeeping services can help you prepare for and navigate audits.
Even if you don’t fall into these categories, consider the time and stress you could save by outsourcing your bookkeeping. Many business owners find that the peace of mind and freed-up time are well worth the investment.
Does My Business Need A Bookkeeper?
Deciding whether you need a bookkeeper ultimately depends on your specific business needs, financial complexity, and personal comfort with managing finances. Here are some questions to ask yourself:
1. Are you spending too much time on bookkeeping tasks?
2. Do you often miss important financial deadlines?
3. Are you confident in the accuracy of your financial records?
4. Do you understand your business’ financial health?
5. Are you able to make informed financial decisions based on your current recordkeeping?
If you answered ‘no’ to any of these questions, it might be time to consider professional bookkeeping services.
Assessing Your Business’ Financial Health
Good bookkeeping is more than just keeping records. It’s about gaining insights into your business’s financial health, identifying trends, and making informed decisions. A skilled bookkeeper can help you understand your financial data, spot potential issues before they become problems, and identify opportunities for growth and cost savings.
Starting Early
Moreover, as your business grows, your bookkeeping needs will likely become more complex. Starting with a solid bookkeeping system early on can save you headaches down the road and set you up for long-term success.
JBS Corp Offers Controllership and Bookkeeping in Massachusetts and Beyond
If you’re considering professional bookkeeping services, JBS Corp offers a comprehensive solution that could be perfect for your business needs.
We provide dedicated bookkeepers supported by a team of knowledgeable business experts. Our chat support is just a few clicks away, ensuring you always have access to the help you need.
Our standard monthly financial package includes a balance sheet, income statement, and statement of cash flows. For businesses with unique needs, we can provide additional management reporting tailored to your growing business.
Acting as your controller, JBS will consult with you on your numbers and ongoing needs. This includes regular cash forecasting and reviewing and analyzing financial data. With this depth of data and analysis, you can apply for business loans with greater confidence, respond more quickly to opportunities, and chart a course for your company’s future based on accurate, actionable insights.
Our services include:
- Standard monthly financial package: balance sheet, income statement, and statement of cash flows
- Management reporting: cash reporting, budget vs. actual analysis, and a key performance indicators (KPIs) dashboard
- Job cost and inventory tracking
- Forecasting: Budgeting and cash-flow forecasting
Remember, you didn’t get into your business to do accounting; you started your company to do what you’re passionate about. With JBS Corp’s controllership and bookkeeping services, you can focus on your passion while leaving the financial management to the experts.
By choosing us for your bookkeeping needs, you’re not just getting a service – you’re gaining a partner in your business’s financial success. Our approach ensures that you have all the financial information and support you need to make informed decisions and drive your business forward.
Final Thoughts
While not every business may need full-time professional bookkeeping services, most can benefit from some level of professional financial management. Whether you choose to hire an in-house bookkeeper or outsource to a firm, the key is to ensure your financial records are accurate, up-to-date, and useful for decision-making.
Investing in proper bookkeeping is investing in your business’s future. It provides the financial clarity you need to make informed decisions, the organization required for smooth operations, and the foundation necessary for growth. So, do you need a bookkeeper? If you value financial accuracy, peace of mind, and strategic insight into your business finances, the answer is likely yes.
