You are a business owner. Congratulations! You have made an excellent decision to run your own company. You know that being self-employed is both rewarding and challenging, particularly when it comes to the financial reporting side of things. Now you need to hang up your boxing gloves and let someone else take control of the numbers so you can focus on growing your business. Who better than a professional bookkeeper?
Not sure what a bookkeeper does? A bookkeeper manages all areas related to money within your company, including recording transactions into journals or ledgers, which then allows your accountant (or yourself) to prepare financial statements for taxation purposes. They also advise you on any tax implications involved with running your business; finally, they produce end-of-year accounting documents such as your company tax return.
You also need to understand that it's not only the big end of town that needs a bookkeeper; self-employed and small business owners can benefit greatly from hiring one too. Here are 10 reasons why:
1. Saves you time
Bookkeepers work on a whole range of companies, so they know what to do and how to do it efficiently while avoiding mistakes; they'll save you time by knowing which information is critical for reporting purposes, making sure invoices are paid on time, or chasing up clients who don't pay, etc.. Time is money! It costs money when you have to catch up with things at the last minute because an invoice wasn't sent out; it costs money when you book a meeting with your accountant and he or she has to spend an hour looking for basic information like outstanding invoices.
2. Saves you money
A good bookkeeper will be up-to-date with current accounting practices and ensure that the financial side of your business is operating as efficiently as possible, saving you time, effort, and money in the long run. They can also save you tax by ensuring expenses are only claimed where appropriate, so the sharing economy works to your advantage.
3. Prevents cash flow problems
If your business runs on cash, which most small businesses do, then knowing what's coming into the company and what's going out is critical for ensuring there's enough money in the bank to pay your bills and salaries on time and avoid late payment penalties. This in turn affects cash flow which in some cases could mean the difference between staying afloat or going broke.
4. Free up your valuable time
Let's face it; unless you're a financial wizard who enjoys balancing the books, you don't want to spend hours each week looking after what can be delegated to someone else. Bookkeepers know that once they set everything up correctly it should run smoothly without any hassle for you, allowing you to focus on growing your business.
5. Provides continuity of service
A good bookkeeper always ensures he or she knows where all the "trees are buried" because they are building their knowledge on the financial history of your business, so they are aware of where things have come from and how to get the best results. If you are growing your business on a day-to-day basis, you need someone who understands your business so they know what is critical for reporting purposes, while identifying gaps in financial reporting along the way.
6. Gives you more time to do what you do best… run your business
Bookkeeping systems vary greatly depending on the size of your company and how complicated it is, but at its most basic level, there are three main categories: cash management (i.e., recording transactions), cost accounting (i.e., analyzing costs), and profitability analysis (i.e., measuring performance). Once set up and working efficiently, bookkeeping will ensure you have accurate information every time you need it.
7. Helps you identify ways to save money and increase profits
Bookkeepers know their way around an accounting system and can help you spot where things might be going wrong, such as cash flow issues or poor costing of your products or services, allowing you to make changes that improve your business without any additional costs. They will also produce regular reports so you can monitor different facets of your financial performance, such as turnover versus profit growth. This enables you to track how well (or not) the company is doing overtime which is critical when planning for future growth or when seeking finance from investors.
8. Provides tax efficiency
If you're compliant on the tax front, which you should be if running a business (and yes, that includes Uber drivers), then there is no question that professional advice at this level could save you money. Bookkeepers will help identify issues with tax compliance and suggest ways to reduce your overall tax bill without affecting profitability. They can spot deductions for expenses that vary from month to month, saving you time if they need to be claimed down the line or allow early claims when appropriate.
9. Ensures the financial integrity of the business
Your bookkeeper should clearly understand all aspects of your company operations and how one process impacts another throughout your whole system. What's more their job depends on it! Their knowledge should include full visibility of where and when your cash is coming in and going out, which in turn will prevent any fraudulent activity.
10. Provides peace of mind
Unless you're a financial expert yourself, having someone to trust with your most important financial records should make you feel more secure about the future prospects of your business. It's nice to know that there is always someone on hand who knows what is going on and can quickly jump in to help when needed. They may not be able to wave a magic wand and fix everything but they should be able to guide you along the right path so you can resolve issues for the long term.
If you would like some help finding a good bookkeeper, or simply need an extra pair of hands around the office then please get in touch, we'd be happy to help.
You can find out more about our services by going to www.clebookkeeping.com or emailing info@clebookkeeping.com. You can also call us at 620-670-4501 if you prefer a hard copy! If you want a personalized service feel free to contact me directly at cedmondson@clebookkeeping.com- I'll be happy to help.
Note: the article above is written for informational purposes only and should not be construed as constituting legal.
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