At some point in their business set up, every small business owner asks if they should DIY their bookkeeping. Each business operation is different as is their owner. In the end you need to decide what is right for you, your business, and the economic situation a the time.
Money
The thought of outlaying funds for something you can very well accomplish on your own is often what drives business owners to completing their own bookkeeping and taxes. It depends upon how much you value your own time and effort. It will probably take some time on a weekly basis, or possibly a bit longer on a monthly basis, to keep all your records in order and have the necessary reporting to know if you are financially stable or not. It will take several days, or a weekend, to complete the tax returns.
If you have a good understanding of accounting principles and have the dedication to keeping your records error free, you should definitely tackle the project on your own. However, if you have any concerns about filings, the fees you pay an accountant will certainly outweigh the penalties and interest involved in errors.
While doing your own books will certainly keep you in closer connection with your financials, if you hire a good accountant, they should alert you to any irregularities. They should also be available for questions or concerns.
Who to Hire
You can be reluctant to hire a bookkeeper if you have had a bad experience in the past. Not everyone who calls themselves a bookkeeper is really good at it. Ask around for recommendations on Bookkeeping Services and interview them to see if it is a good fit. If you already use an accountant, see if they have any suggestions. Proper bookkeeping should save you money and/or make your business more profitable.
Time and Money
Of course, hiring a bookkeeper, even part time, will cost some money. If you are already having cash flow problems, this could be an issue. However, when the burden of tracking all the numbers is off your plate, you may be able to devote time to growing the business.
Timing is another issue. You will have more hours to look at daily operation and you won’t have to catch up all at once.
If you are struggling with keeping all the numbers up to date and making sense, or if you dread the hours it will take to do the quarterly reporting, annual taxes, and financial statements, finding a reliable and professional bookkeeper is a real option.
On the other hand, if you want to maintain strict control over all aspects of the business, then you need to find a way to carve out the time to make the entries and see that everything balances. At the end of it all, you need to make the decision that makes the most economic sense for you and your business.
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- The Capex Team