5 Signs it’s Time to Hire a Bookkeeper for your Small Business

If you check one or more of these boxes, your business may be ready to grow into its next phase.

In the early stages of business, small business owners typically manage everything. Along with supporting their clients and customers, they’re also responsible for a host of operational and financial tasks, including invoicing, billing, recording and organizing financial data, reconciling transactions and payroll. 

As the business grows, maintenance of daily bookkeeping can start to steal focus from deep work and customer relations. Bookkeeping tasks may even begin to pile up and become less of a priority. 

The significant growth of a business is an exciting time, but it can also mean a shift in roles and responsibilities in order to grow successfully.

If you’re unsure whether it’s time to hire a bookkeeper for your small business just yet, here are five signs to look out for.

1. Increased revenue and sales

Have you noticed an increase of revenue and sales? With more products and services sold, prompt recording of transactions and your accounting records will need to be kept up to date, which can be challenging to keep maintaining yourself with growing demand.

Accurate and up-to-date accounting records will not only help provide the basis for financial statements and tax returns, but also provide a better understanding of which products and services bring in the most money to help inform decision-making strategies.

2. More complex transactions

3. Unpredictable cash flow

If you don’t have a clear picture of when money from clients will be received, or if you’re uncertain if you’ll have enough money to pay contractors or employees, then you may need support from a virtual bookkeeper. They will help put together cash flow statements to provide clarity on how much money is coming in and out, and help identify the parts of the business that are profitable, and parts that deplete or don’t add to the business.

4. Accurate financial reporting and proper compliance

DIY bookkeeping can be manageable in the short-term for new business owners, but without a legal or accounting background, eventually they will run into issues as the business grows. Virtual bookkeepers are familiar with compliance requirements and can help assess your financials so you don’t run the risk of paying fines and penalties down the road.

5. Difficulty keeping up with bookkeeping

If you’re falling behind on bookkeeping or spending too much time trying to figure out how to do it properly, then it’s time to hire a virtual bookkeeper. Consider how much time you may be spending per week on bookkeeping, and if that time might be more valuable spent on other areas of your business. 

If your financial records stop reflecting the state of your business, then there will be uncertainty of the financial health of the company and issues can arise. You’ll also spend a lot of valuable time playing catch up during tax season, which can be stressful. 

How a virtual bookkeeper can help

A virtual bookkeeper can provide you with up-to-date accounting records, which allows for reliable and accurate reporting, stronger expense management and a clarity on cash flows. While a virtual bookkeeper’s duties may differ slightly depending on your industry, their general responsibilities include:

• Keeping day-to-day transactions up to date
• Reviewing and confirming banking deposits and that withdrawals match internal records
• Applying sales tax treatments accurately and consistently
• Filing tax payments correctly and on time
• Ensuring support documentation is saved electronically and filed systematically
• Streamlining processes for efficiency

Hiring a virtual bookkeeper will provide you with an accurate financial picture of your business to help you make more informed strategic decisions and give you peace of mind.

Ready to connect with a virtual bookkeeper? Get in touch.