Bookkeeping is an important part of any business. However, it is easy to overlook this integral part to focus on other priorities like meeting clients and filling customer orders – among other things. It’s understandable since those things keep your business running, but bookkeeping is essential.
Delays in managing your books can cost you in the end. For instance, if you choose your accounting as a priority over managing your business, you will find yourself wasting time and falling behind when filing your taxes. This could result in paying a fee at the last minute to hire an accountant to clear things up for tax season.
In this article, we will highlight ten ways that you can benefit from making bookkeeping your priority or hiring a professional bookkeeping company for your company.
1. Ensure timely payment of bills.
When conducting your daily business activities, something might get left out along the way. These might be the bills that need to be paid. Nobody wants their credit impacted by forgotten or late payments.
Some small businesses and freelancers are considered riskier clients, as they don’t always have detailed records of their business activities. Hiring a bookkeeper will ensure that records are updated and everything else is handled on time, which will also increase the chances of receiving funding.
2. Focus on the most important business needs.
A business requires the attention of its founder to grow its idea into a viable service or product. This means that as a founder, your time should be focused on marketing, strategy, funding, and other important areas that need your focus as part of the daily business operations.
A bookkeeper takes up the tedious role of dealing with the finances of the business so that the founder can focus on other important areas of growing the business.
3. Strike a balance between work and personal life.
Managing your business can take a lot of time that you wish you could be spending with your loved ones. This may affect your personal life-work balance, which is not good for your health. Hiring a bookkeeper will take a load off your back so that you can focus on other important things that matter to you in life
4. Avoid what you do not know or understand.
Not every business owner has knowledge in finance, accounts payable, taxes, and accounts receivable. It is important to hire a certified professional in those areas to handle those business aspects. This way, you will make fewer mistakes that could cost you money. If you fail to pay something important or miss a bill, it will impact your business credit.
5. View your business from a different angle.
Despite having a good idea about your business during the development phase, it is important to have outside views about your business. A bookkeeper can put your finances in order and make reports to show you how your business is doing every month, where your funds are being spent, and how you gain from your efforts, or where you need to improve.
A bookkeeper can give you a big picture of how the numbers behave and if you are accomplishing your goals.
6. Avoid the tedious tasks of the business.
The financial aspect of a business can be difficult to understand for any business owner. It is usually not enjoyable to tally up payrolls or write checks to pay bills. Your bookkeeper, on the other hand, will understand those tasks. It makes sense to hand these roles to someone who is passionate and motivated by them.
7. Maintain a constant cash flow.
As a business owner, you may be too busy to notice outstanding payments from your client base. Any late payments could seriously affect constant cash flow to keep your business running. When you hire a bookkeeper, they can handle this by sending reminders and preparing statements of cash flow to ensure that your flow of cash is optimal.
This will give a clear impression of your business and help you get more funding if needed. You can now show a positive cash flow that you might otherwise not have been able to show without that assistance.
8. Reduce financial obligations’ costs.
Despite the thought that you might be saving costs by handling everything by yourself, the fact that a bookkeeper might be helping you save money is even better. This is because there is a reduction in the risk of human error, missed payments, lack of knowledge, tax obligations, financial deadlines, and delayed accounts receivables.
Also, your time is money that you could be investing in running your new business and generating revenue to get to the next level.
9. Ensure that you resolve any conflicts of interest with business partners.
A business that has more than one founder could experience various conflicts, such as how to access money and how to spend it. Such conflicts of interest could impede the business’s progress.
For this reason, the bookkeeper could be like a gatekeeper, creating the relevant approval processes that stop the business partners from withdrawing money carelessly.
10. Make the correct tax filings.
The last thing that any business owner would want is to have their businesses audited by the IRS for simply forgetting those annual or quarterly tax filings. Depending on the type of your business structure, you will have various tax obligations like estimated tax payments, IRS Form 1099 for freelancers or contractors, corporate tax payments, and other filings.
It is beneficial to find a bookkeeper who can handle payroll as well as taxes and other financial issues.
Bookkeepers know how to maximize tax benefits, monitor your finances, keep your business out of financial trouble, build your credit score, help you reduce errors, and save you time and money.
A bookkeeper completes payroll, writes invoices, records financial transactions, and keeps track of your purchases, sales receipts, and payments – among many other roles.
Small businesses need the stability of an accurate financial plan to enable them to sustain their activities. The bottom line is that you should hire a bookkeeper if you want to save time, incorporate your business with professional financial advice, and gear your business towards its goals.
Getting an understanding of your financial situation is determined by the accuracy of your books. Make sure you hire a qualified bookkeeper like Sherry Borshoff! Book a free consultation to find out how she can help your business succeed. You can trust Indiana’s tax expert!