The picture of a bookkeeper is someone surrounded by paper in the cubicle next door, but this picture is fast becoming antiquated. Today’s businesses no longer need to hire an accountant or create an internal accounting department. Instead, online accounting services or virtual bookkeeping allows businesses to outsource their financial workload while maximizing the benefits of professional accounting expertise.
As technology also plays a growing role in business, outsourcing has become a popular way for businesses to grow without the added overhead expenses related to increasing staff, office space, and benefits. Virtual assistants have grown in popularity, and other aspects of the business administration are quickly following suit. One of these in particular is virtual bookkeeping, where you work with your bookkeeper digitally, instead of having them in the next cubicle or office. So, what is virtual bookkeeping and how can it be a bonus for your business?
What Is Virtual Bookkeeping?
Virtual bookkeeping, also referred to as remote bookkeeping, allows online bookkeepers to handle your transactions, reconciliations, payroll, and more. Using cloud-based accounting software and digital collaboration, your business can benefit from their expertise while keeping your financial records up-to-date.
Virtual bookkeepers provide services at a price point most small businesses can handle, while giving you the ability to successfully manage your financial health. This could be the right choice for your business for the following reasons:
- Keep you ready for tax time
- Teach you about tax deductible expenses
- Connect with your bookkeeper regardless of wherever you are
- Monthly reconcilations
- Regular financial statements
- Greater understanding of your financial health
At the same time, it is essential that you vet your bookkeeper or accountant for their certifications and experience. Additionally, you want to make sure to use an accounting software with security measures in place to protect your sensitive data. Clearly, there are plenty of benefits for your business, but are those same benefits available for your budget?
How Much Does a Virtual Bookkeeper Cost?
Virtual bookkeepers can be found as part of an accounting service or as an individual. Pricing will depend on the number of transactions, the size of your business, and other factors, including what accounting processes you want to continue to do within your daily and weekly routine.
As you grow your business, the costs for a virtual bookkeeper or accounting services can increase but many bookkeepers are willing to customize your services to meet your budget. With virtual bookkeeping, you can always find the services you need at a price point that fits your budget.
8 Ways Virtual Bookkeeping Can Help Your Online Business
There are many benefits to working with a virtual bookkeeper, which can keep your business finances in order. Yet, beyond that, there are long-term advantages of working with a professional bookkeeper or accountant, particularly as your business continues to grow. Here are 8 reasons why your business will benefit from using a virtual bookkeeper.
1. Get Your Bookkeeping In Order
Building a business means being pulled in multiple directions, which can make it challenging to find the time to update your financial information with daily and weekly transactions. Using a bookkeeper is a great way to keep your financials up to date. If you are falling behind with your bookkeeping, hiring a service can be the best way to get your financials back in order. They can also assist you in setting up your software, so you can move forward with confidence as you grow your business. Knowing that you don’t have to worry about putting transactions together right before tax time or your next meeting with your financial institution can give you peace of mind and reduce your stress level.
2. Better Understand Your Business Financials
When you start your business, the focus is on building a clientele. But to make the right decisions to grow your business, it is important to understand its financial health. Working with your bookkeeper, you can easily break down your financials to understand whether you have the cash flow or capital to take advantage of opportunities. Instead of just having financials printed out, you clearly understand where your money is being spent and whether your numbers are out of line with industry standards. Plus, your virtual bookkeeper has years of expertise, making them the right choice to answer your questions and help you breakdown the numbers to understand the finer details.
3. Save You Money
When you understand where your money is being spent, then you can determine where adjustments might be necessary. Plus, if you can see your sales numbers, then you can use that information to negotiate better deals on inventory or raw materials. But if you don’t know your financials and current cash position, then you won’t see the savings that could propel your business to the next level. With your virtual bookkeeper, you can have a clearer picture of your expenses and determine where you can make cuts without sacrificing the quality of your products and services.
4. Make You More Profits
Knowing your cash position means you can take advantage of opportunities that lead to growth. By understanding your current financial position, you can tap into the right credit and working capital loans to build your inventory, expand your staff, and put your business on the path to growing both your sales and profits. Additionally, you can look at what lines of your products are increasing your sales and which ones might need to be phased out. With the ability to target your capital effectively, you can build your profits based upon what your clients expect from your company.
5. Makes Filing Taxes Easier
With up-to-date financials, filing your taxes is simpler because you have all the information together in one place. No more rooting through file drawers hoping you have all your receipts and can create a spreadsheet with all your transactions. Instead, your virtual bookkeeper will already have all that information together and organized, ready for your tax provider to complete the process and file your business taxes at the federal and state levels. If you need additional time, your tax provider will find it easier to file for the appropriate extensions because they have everything they need from your virtual bookkeeper.
6. Gets Your Finances In Order For An Eventual Sale
Has your startup business reached the point where you are ready to exit? To understand the value of your business, your financials need to be up to date. With your bookkeeper, you can be sure that every transaction, from expenses to income, is recorded. That allows your forensic accountant to determine the value of your business before you put it up for sale. Plus, you can also determine whether your valuation is on par with industry standards. With the right information at your fingertips, you have the ability to set a reasonable sales price for your business and exit in a timeframe that meets your needs.
7. Helps With Getting Loans and Investments
With your financials current, you can impress financial institutions with your knowledge of the financial health of your business. That also means you can provide the documentation necessary to meet their requirements, thus giving you a greater level of options when it comes to finding capital for your company’s expansion plans or growing your team’s skill sets. Ready to invest capital into new equipment or significant production line upgrades? Having your bookkeeper working to maintain your financials means you are ready to present accurate numbers to any underwriter.
8. Gets You Time Back to Grow Your Business
Bookkeeping can be time-consuming, taking you away from other critical aspects of your business, from training your staff to sales and marketing. With a hired bookkeeper, you can delegate this task and focus your talents in the areas of your business where they are necessary, thus helping you to stay on target to reach your long-term goals for your company.
Growing a business means making smart financial choices and knowing where to spend your capital and when to spend it. If your bookkeeping is not up-to-date, you be putting your business at risk of missing critical opportunities to reach the next level. Working with a hired bookkeeper allows you to cost-effectively manage your financials while also giving you the freedom to focus on other areas. Are you ready to delegate this task? Then consider hiring a virtual bookkeeper today!