Bookkeeping: Do it Yourself or Hire a Professional?
Small businesses learn to make the most of the resources they have. As an entrepreneur, you’re used to wearing multiple hats. When it comes to bookkeeping, accounting, and tax preparation, however, it may be time to take a step back. It all depends on what you’re comfortable with. Bookkeeping is an essential part of your business, so whether you decide to do it yourself or hire a professional, make sure it’s done right.
Things to Consider
Knowledge and Interest
The most important factor to consider is whether you are capable of properly keeping your books. Do you have experience with bookkeeping or accounting? Do you understand balance sheets and incomes statements? Perhaps you like to keep tight control of your finances. If you’re interested but don’t have the knowledge, consider taking an accounting class or two.
For some people, bookkeeping can be extremely boring. Boredom often leads to complacency, which leads to mistakes. Your finances are not the place to be making a mistake.
Time and Money
For most small business owners, time is their most valuable asset. Ask yourself, “Am I the best person to do this?”
Consider the other things you could be doing that would make a bigger impact on your business than keeping your own books. You may find that, considering the time you lose, it actually costs you more to do it yourself than it would to pay someone.
So you’ve decided to take the do-it-yourself route. Good for you! Unless you’re an accountant, you may have a bit of a learning curve. Give yourself the best chance to succeed by putting good systems and processes in place.
Start by creating a routine. Sit down for five or ten minutes every day and make sure that your books are in order. Record all of your transactions (even the minor purchases) in the proper place. Not only will this make things easier for you at the end of the month, but it will enable you to monitor the financial pulse of your business at all times. You will minimize mistakes and surprises by keeping up with things daily.
Choose Small Business Accounting Software
These days, there really isn’t any reason to keep your books on paper. It’s easy to lose, difficult to use, and leads to more errors. Instead, consider investing in some simple, professional accounting software.
At First Bank, you can use Autobooks, which is a seamless addition to the online banking services you already use. With it, you can send invoices, track expenses, accept payments online, and manage your bills. Plus, your first 60 days with the service is free.
Working with a Professional
If your company has the resources to hire a professional bookkeeper or accountant, doing so is almost always the way to go.
Hiring the Right Person
First, make sure that the person you hire is professional and has the necessary knowledge and experience to keep your books. Ask for referrals and follow up with them to make sure you’re making a good choice. Ideally, find a bookkeeper with experience working with businesses in your industry. They will know what it takes to get everything set up, so it’s easier to get started.
How They Will Help
In most cases, you’re not going to need to hire them full time, so staying organized and aware of your business’ financial situation is still extremely important. It will also make things easier for your bookkeeper when he or she comes in to review the books. A good bookkeeper will be able to maximize your tax exemptions, make suggestions to help improve your business’ cash flow, and free you up to focus on growing a strong business.