To what point does it cease to be a clever idea to handle your own finances and begin to retard your business?
For most small businesses, such a tipping point comes sooner than they anticipated. According to recent statistics, more than 60% of small businesses intend to increase outsourcing of bookkeeping services as they expand, driven by increased complexity and cost pressures (Global Growth Insights).
When starting, it can seem easy to keep your own books, but after a certain number of transactions and added compliance regulations, managing the proper upkeep of financial records can take 10-15 hours a month, time better spent on strategy and growth (WifiTalents).
What is more, manual bookkeeping is a significant issue for most small businesses (approximately 65%) as it is complicated and time-consuming (ZipDo).
This blog post will address the most urgent questions about hiring a remote bookkeeper and help you determine when to switch from DIY bookkeeping to professional services.
Knowledgeable, practical advice and critical decision-making points will help you ensure that your financial documentation is not only precise but also managed effectively, keeping your business in compliance, nimble, and ready to grow.
What is Bookkeeping?
Bookkeeping is the process of regularly recording a company’s financial transactions on a monthly and annual basis. It organizes the company’s accounts into reports and graphs that business owners can later evaluate to make informed financial decisions.
Keeping your financial records up to date and accurate can help you measure your company’s financial performance and take the necessary steps to improve it. Detailed financial reports can also be helpful when your firm is being audited.
Why is Bookkeeping Important?
Detailed and accurate bookkeeping is one of the foundations of a successful company. It is pivotal for an accounting department as it can help them suggest positive initiatives that business owners can take to drive their venture forward. Without detailed books, it can be challenging for you to evaluate your business needs and mitigate financial risks.
These butterfly effects can lead to serious consequences for your business in the long run. Thus, it is recommended that business owners implement remote bookkeeping and automate their accounting processes to avoid errors, stay up to date with their financial records, and save costs on hiring and training resources that can be better utilized elsewhere in the company.
Why Remote Bookkeeping?
Amid the accelerating pace of business processes, companies are hastily adopting remote solutions. This involves remote bookkeeping also. Implementing remote solutions can enhance resource efficiency and reduce operating costs.
Moreover, with advanced tools, remote bookkeeping can provide you with accurate books that are 24/7 accessible to you and your team, enabling you to make important decisions and measure performance.
These benefits have made remote bookkeeping an attractive solution among startups and SMEs. However, before opting for remote bookkeeping, you should evaluate your business needs, consider consulting a financial expert, understand its drawbacks, and learn how to hire the best bookkeeping service for your company. This blog has been written to help you make an informed decision when hiring a remote bookkeeping service.
What is a Remote Bookkeeper?
Remote bookkeepers manage business financial records from a location outside your office, often from home, known as a remote location. They perform all bookkeeping tasks, such as recording transactions, managing accounts payable and accounts receivable, preparing financial reports, and ensuring compliance with tax regulations. Still, they do so using cloud-based accounting software and communication tools.
Remote bookkeeping services are provided by a team of skilled professionals who manage your company’s financial resources from a location outside your office, often from their home or a remote workplace. They perform all the repetitive bookkeeping tasks, such as recording transactions, managing accounts payable and accounts receivable, ensuring tax compliance, and preparing financial reports.
They also use accounting automation software that can help prepare accurate and detailed financial reports in a shorter period of time. Your financial data is then stored on a cloud-based platform that you can access 24/7, keeping you up to date with real-time financial information about your business.
15 Best Tips for Hiring a Remote Bookkeeper:
Outsourcing bookkeeping to a remote specialist saves time, reduces errors, and allows business owners to focus on growth. More than 60% of small enterprises are currently considering outsourcing the bookkeeping (Global Growth Insights). It is important to understand how to select the correct professional. The following are 10 ideas to help you make a good decision.
1.Data security
Financial data is highly sensitive and critical. Thus, you must research the people who will be managing it. Make sure that the bookkeeping service provider follows strict security protocols for their customer’s financial data.
2.Software Literate
Verify that the bookkeeper is proficient in the accounting software you use or is capable of recommending and implementing suitable cloud-based solutions (TOA Global).
3.Verify Certifications and Experience
Before hiring a remote bookkeeping service, you must verify the necessary qualifications, certifications, and experience that are required to manage a company’s finances. Be on the lookout for any forged certifications; you do not want to hand over your financial data to someone who may have cheated their way into the industry.
4.Communication Skills
Communication gaps can be a big factor when working with offshore employees. When hiring a bookkeeping services provider, make sure they are proactive and responsive. This will ensure that human bookkeeping assistance is at hand when required.
5.Customer Reviews
A company’s customers can tell you the most about its services. Consider asking for reviews from the already existing customers of the remote bookkeeping service you plan to hire. You can also read their client testimonials and reviews on other platforms.
6.Assess Your Business Needs
Determine whether you require part-time or project-based bookkeeping. Small businesses usually only require assistance at tax time, while growing SMEs need ongoing support for payroll, invoicing, and financial reporting.
7.Seek an Applicable Area of Industry Experience
Select a bookkeeper who is also conversant with your industry. Companies that employ experienced professionals in their industry experience fewer mistakes and can close their books much faster, particularly in businesses such as retail, e-commerce, or SaaS.
8.Verify QuickBooks or Accounting Software Expertise
Most small businesses use QuickBooks or Xero, so they employ a certified bookkeeper who is knowledgeable in these platforms. You will see a 70% increase in reporting, and fewer errors due to automation and cloud-based systems (TOA Global).
9.Check References and Credential
Authenticate credentials, experience, and testimonials. There is greater accuracy and reliability in professionals, as they have a proven track record and minimize the risk of financial discrepancies.
10.Communication Skills Matter:
There should be good communication in remote bookkeeping. Search to find a responsive person to be able to interpret financial data in a common language and offer strategic decision-making insights.
11.Understand Cost Structures
Compare hourly rates, flat rates, and subscription packages. Outsourced bookkeeping can cut up to 60 per cent of expenses compared to in-house, yet disclosure is required to prevent any surprises.
12.Assure Data Security and Compliance
Strict security measures should be adhered to by remote bookkeepers, such as encrypted access to cloud systems and the sharing of files. This helps to safeguard confidential financial information and allows us to adhere to the regulations.
13.Make certain of Availability and Scalability
Your business needs can increase as your bookkeeping grows. Make sure your provider can scale services, add payroll or tax support, and handle seasonal workload spikes (TOA Global).
14.Appraise Reporting and Insights
Good bookkeepers do not just catalogue transactions; they also provide actionable insights. You should seek professionals who present transparent reports, cash flow forecasts, and KPIs to make improved decisions.
15.Start with a Trial Period
A trial period is better before making a long-term commitment. This will help you to assess the quality of work, responsiveness, and alignment with your business needs without significant risk.
Benefits of Hiring a Remote Bookkeeper
By using a remote bookkeeper, you change your business’s financial operations, save time, reduce expenses, and increase precision. With these tips, you can choose a professional who is not only organized in keeping your books but also provides information that supports growth.
Through the appropriate specialist, your company will be able to concentrate on strategic objectives without having to keep cluttered, incomplete, and real-time financial books.
1.Access to Skilled Bookkeeping Experts
By hiring remote bookkeeping services, you can access a pool of global talent that is highly experienced and skilled in their fields. These resources also help you stay up to date with industry trends, as they are always on top of them.
Moreover, they are well-equipped to use the latest accounting software and technology, which can make bookkeeping easier, faster, more accurate, and more comprehensive. This can be highly valuable for SMEs that may not have the resources to hire full-time, experienced bookkeepers.
2.Saves Cost
Who does not want to cut costs in 2024, when inflation is surging, and it is getting challenging for start-ups to keep up with hiring and training costs? This is where remote bookkeeping saves SMEs. By outsourcing your bookkeeping, you can save on utilities costs, hiring and training costs, and benefits associated with in-house employees.
Moreover, remote bookkeeping services can also be hired on a contractual basis: once the work is done, the contract ends, and you do not have to pay any further fees. This enables flexible payment structures that SMEs can leverage to gain a financial foothold in the industry.
3.Frees Up Valuable Resources
By freeing up your existing resources from repetitive and manual tasks such as bookkeeping, you can reinvest their time and ideas in core areas of your small business. This can help you and your team drive your venture forward and compete positively.
Moreover, this will also help make your valuable resources feel valued as they will be involved in the strategic areas of your business. Thus, your existing resources will go the extra mile to contribute to business growth and customer satisfaction.
4.Scalable and Flexible Contracts
Remote bookkeeping can be highly adaptable to your business needs; you can make changes to the contract as needed. This means you can scale up or down their responsibilities and compensation as required, without losing valuable resources. This can be helpful for SMEs struggling to retain full-time employees.
5.Enhanced Security
Most remote bookkeeping services use a cloud-based accounting platform to record your transactions securely. These cloud-based platforms rely on secure end-to-end encryption. This ensures that your critical financial data is stored in a highly secure platform that is accessible 24/7. Moreover, storing financial data on a cloud-based accounting platform greatly reduces the risk of data loss.
Conclusion
The rise of remote bookkeeping offers businesses a flexible, cost-effective, and efficient solution for managing financial records. By leveraging remote bookkeepers’ expertise, companies can streamline accounting processes, enhance productivity, and focus on core activities that drive growth.
However, it’s essential to address potential challenges through clear communication, due diligence, and robust technological support. If you’re considering hiring a remote bookkeeper, take the time to find the right fit for your business to reap the full benefits of this modern approach to bookkeeping.
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Expertise Accelerated’s team of highly skilled bookkeepers can provide you with cost-effective solutions for your business. By freeing you and your valuable resources from repetitive, manual bookkeeping tasks, EA lets you drive your venture forward and achieve business objectives. Schedule a consultation today to gain financial independence.
