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How can hiring a bookkeeper benefit your business?

Whether you are a sole trader or the owner of a small or large company, keeping up-to-date accounts is important. Bookkeeping is crucial for any kind or firm, regardless of its size or the sector it operates in.

What is bookkeeping?

Before we explain the benefits of bookkeeping, we first need to define exactly what we mean by the term. Bookkeeping is the process of keeping records of a company’s financial transactions. Normally it does not include managing payroll, but naturally, how much you pay your staff is recorded by the bookkeeper.

How much was spent and received used to be recorded in a book, hence the term ‘bookkeeping’, but today it is normally done electronically using accounting software. That being said, some small firms still use spreadsheets to record all financial transactions.

Why a firm needs accurate accounts

Keeping an accurate account of all transactions is the only way a firm can determine its true financial health. Without accurate and up-to-date accounts, it is impossible for a firm to know which products and services it is making a profit from, and which it is losing money on.

Good accounts also allow firms to spot points in the year when they may struggle with cash flow. This is important because it allows that business enough time to arrange short-term finance, to secure enough cash to enable it to stay in business during that period, rather than go bankrupt.

Having an accurate record of all financial transactions is also the only way to ensure your tax return is filled out accurately. This is necessary to avoid issues with the authorities.

Save time and money

Outsourcing any task to someone who has more experience and has been able to invest in better tools allows you to save both time and money. Of course, a professional in any field can do a better job than an amateur, and this principle definitely applies to bookkeeping.

Staffing your own accounts department, and equipping them with the necessary hardware and software, is expensive. Add in the need to update their training on a regular basis to keep up with the latest software and changes in tax or employment regulations, and continuing to take care of your own bookkeeping is very costly.

Hiring a bookkeeper is a way to get your hands on accurate accounts, stay abreast of all changes in regulations, and potentially save money too.

Posted by Peter
May 9, 2015

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