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What is Bookkeeping and Does My Small Business Really Need It?

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Your organization can’t survive without a few critical functions— bookkeeping is one of them.

Bookkeeping

 

By definition, bookkeeping is the process of recording and managing day-to-day financial transactions. When done regularly and accurately, bookkeeping ensures that your company does not lose out on profits, avoid getting penalized for incorrect or incomplete tax filings and run smoothly.

Therefore, bookkeeping is more than just financial record keeping. It helps business owners evaluate their financial statements and make informed decisions regarding payments, assets, taxes, loans and investment.

Bookkeeping is crucial for organizations of all sizes, including small businesses. Small businesses must make sure they record and update their financial books. Poor bookkeeping is one of the main reasons why most small businesses face financial mismanagement.

While bookkeeping is important for your small organization, should you do it on your own or outsource it?

DIY bookkeeping is a complex and tedious task. If you want to save money, time and ensure accurate bookkeeping, your best bet is to contact a professional bookkeeping company.

These signs indicate a small business must invest in professional bookkeeping service:

Incomplete or Incorrect Bookkeeping Records

If your company’s financial books are not in order, it is impossible to get a true picture of your financial situation. Moreover, you may incur huge costs in terms of money and time.

Bookkeeping is essential for every organization. By hiring a professional bookkeeping service, you can simplify and streamline your company’s financial documentation.

New to Bookkeeping

Bookkeeping requires a wealth of knowledge because you will be dealing with financial numbers and technical terms, such as account payables, account receivables, etc.  If you have never done it before, it is better to let a professional handle it.

As a business owner, you need to give your attention to other business needs and functions, such as marketing, sales, etc.

Trying to learn a complicated skill like bookkeeping, along with juggling other business activities is stressful. In order to focus on core business areas and enjoy a healthy work-life balance, hire a professional bookkeeping team.

Business Lacks Structure

Managing your company finances isn’t easy. As finances affect the performance and efficiency of your resources and infrastructure at every level, you cannot afford to make mistakes.

If your organization does not have a solid plan to handle your finances, hire a professional bookkeeping service provider. After all, a well-defined bookkeeping and accounting workflow can boost productivity and help you achieve growth.

Unpaid Bills and Uncollected Customer Payments

With an efficient bookkeeping service, you will not have to worry about late bill payments or uncollected customer payments. Consequently, all your financial accounts will be up to date.

Any late or outstanding customer payments affect your cash flow. To ensure a positive cash flow for meeting your company’s expenses and other needs, you require a well-organized bookkeeping system. A professional bookkeeping company can help you achieve both goals.

Misclassified Employees

Employees are the backbone of your organization. If you are unable to pay your employees on time, they will leave your organization.

Employee payroll and taxes can often be a stressful undertaking. Most companies have all kinds of employees, including but not limited to full-time, part-time or independent contractors on their payroll. Different employees within your organization are subject to different tax rules.

One of the biggest benefits of hiring a professional bookkeeping service provider is that they can help you stay on top of employee payroll and tax deductions. Incorrect classification may lead to penalties for tax infringements.

Not Using Bookkeeping Software

Technology is an integral component of businesses now. Bookkeeping software is an asset for small organizations as it saves time and money by eliminating the risk of miscalculations and misrepresentation of your books.

 

For cloud-based bookkeeping services, get in touch with us. Our trained and certified bookkeeping team  will import all your financial data into cloud software to streamline your business.

With your personalized bookkeeping team, you will have access to the most innovative tools in the industry. We also follow the best industry practices so that your valuable data is always safe and secure.

Contact us  today to find out more about our cloud-based bookkeeping solutions.

 

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