What Is Bookkeeping for Business - Why Get a Bookkeeper?

This article will examine what small business bookkeeping is and why you should have one. Bookkeeping can seem like a daunting task for any company owner. Understanding the ins and outs of accounting and double as a business can be difficult. However, it doesn't need to be that way.

If you run your business as efficiently as possible, it won't require much attention from you to keep things going smoothly. You don't need to know how to balance a chequebook or keep track of receipts to run your business. If you have access to an accountant or bookkeeper regularly, your company may not even qualify as a 'small business.

That being said, running your own business can sometimes be challenging if you don't have the right resources to assist you with the workload. Therefore, let's look at small business bookkeeping and why you should have one.

What is a bookkeeping service?

Bookkeeping services are the tools that companies use to keep track of their business's finances. These include things like keeping track of taxes, payroll and bank deposits. What makes these services so valuable is the ability to keep tabs on all the money coming in and going out of your business.

It's also important to consider how much time is involved in running a company. If you don't have an accountant or bookkeeper, managing your time and financial responsibilities is not easy.

To help manage your time, a bookkeeping service can take care of most of your paperwork. It would be best to consider how much information a company needs before beginning work with one. A lot goes into running a small business, and it may take time for you to go through everything that needs to be done with your company before finding the right bookkeeper.

It may also mean looking at different types of bookkeepers (for example, those specialising in specific industries) when narrowing down who will suit your business best.

What is the difference between bookkeeping and accountants?

Small business bookkeeping is the first step of a company's accounting needs. Although small business bookkeeping may not make it entirely, it is essential.

One of the most significant differences between bookkeeping and accountants is that bookkeepers are typically not certified to do taxes or other more complicated business tasks. They still understand what needs to be done and can provide guidance.

On the other hand, accountants typically work with expert tax specialists to ensure that all paperwork is in order so that your company isn't getting ripped off financially by the government.

Additionally, accountants can help you avoid any grey areas in your company and keep your company running smoothly by providing expertise in every aspect of running your business, from finances to human resources.

So what is the difference between a small business bookkeeper and an accountant?

A small business bookkeeper can handle certain aspects of accounting for you, such as cash flow management and essential bookkeeping functions; in contrast, an accountant takes everything from tax filings to managing payroll and other complex aspects of work life for a company.

Why should I have both a bookkeeper and an accountant?

You should have a bookkeeper and an accountant who will allow you to make confident decisions about your business. You'll be able to decide which of the two services you need for your company, depending on your financial needs.

If you choose to hire an accountant to manage the financials of your business, you won't need someone who also understands how your business works. By having a bookkeeper and an accountant in place, you'll be able to focus on what matters most to you and your company: running a successful company.

When should I hand over the books to a Bookkeeper?

The most common reason people hire a bookkeeper is when they are starting, and their business is in the early stages. When you're just starting with your company, tracking your expenses, income, and more can be challenging.

It would take too much time to manage everything on your own. For example, if you're a new small business owner who wants to start an online store, working with a bookkeeper from day one can help you develop a solid foundation for your company. The person will help you learn how to calculate profit margins correctly and ensure that all your expenses are covered.

Bookkeepers also make sense if you have employees or freelance contractors who must be paid for their work. A bookkeeper can create invoices and assign those receipts to the correct customer or employee, which also makes filing tax returns easier. If there are any discrepancies with what was submitted by the freelancer or employee, it will be easier for the bookkeeper to fix it before sending in your taxes.

What do I still need to maintain as a small business?

If you're not using an accountant or bookkeeper and your company is small, you may still be responsible for some tasks. For example, keep track of your hours and the cost of materials to comply with pay laws. You can also use a spreadsheet to keep track of company finances on a personal level.

However, this is only necessary if you don't have anyone else at work to help out. A good bookkeeper can manage these tasks for you, so it doesn't take up too much time. They'll also help decrease the number of errors made, as mistakes are more easily caught and fixed when they're part of a more extensive record.

As a result, if you find yourself in a position where your business needs bookkeeping services, consider hiring one. Bookkeepers won't cause hundreds of man-hours of work every month and can simplify many accounting tasks that would otherwise require a lot of time from you.