Some small and medium business (SME) owners try to do their own accounts or they may employee a bookkeeper directly. This can be fine if you are lucky enough to recruit a good bookkeeper directly, however unless you have an accounting background and a thorough understanding of the accounting software involved, it can be difficult to know what questions to ask at the interview process.
Even if you find someone who looks good on paper, unless you know what reports to ask for it can take months to pick up if they are performing or not. Over 50% of clients that come to us have had a bad experience trying to employ a bookkeeper directly. Usually within the first week we uncover things such as:
- Double payment of creditors invoices
- Under-billing of revenue
- Incorrect GST coding usually resulting in under-claiming GST Credits
- Miscalculation of superannuation and payroll tax of employees and contractors
These mistakes can be very costly and sometimes terminal for some businesses.
Here’s 7 ways a professional onsite bookkeeper will save you money:
1. Help you work “on your business, not in your business!”
I know, it’s an old chestnut from that fantastic book E-Myth and which forms the cornerstone to most business coaching strategies. It is the key to being able to grow any business and applies to bookkeeping as with any other part of your business. If you employ a bookkeeper, you still have to monitor the quality of their work, when they work, when they take holidays, etc.
By outsourcing all of your accounting and bookkeeping functions to a professional bookkeeper, all of your accounts duties become their responsibility and you can focus on growing your business, with the confidence that you are receiving accurate reports on your performance and meeting all statutory obligations.
2. An onsite bookkeeper gets to know your business
There are some bookkeeping services that offer to take care of your accounts from their office which could be based anywhere in Australia or as far away as India. This involves transferring source documents either electronically or physically back and forth from your office to theirs. While this can be fine for micro businesses, it can prove difficult once your business begins to grow.
Before you can provide meaningful management reports, you need to know how a business operates and what are it’s key performance indicators. The only way to achieve this effectively is to get to know the company and the people who work within the company. This can only be done by performing the bookkeeping functions at the clients premises.
3. There’s “bookkeepers” and then there’s “bookkeepers!”
There can be a huge difference in skill level of people that call themselves bookkeepers. Just as an apprentice “chippie” and his boss with 30 years construction experience may both call themselves “builders,” people representing themselves as bookkeepers can range from data entry clerks through to qualified management accountants.
A professional bookkeeping firm should be accredited in the accounting software used by your company and they should have qualified accountants to support their bookkeepers to enable them to provide a management accounting level of service. In part 2 of this blog I’ll look at a couple of more specific ways a professional bookkeeper can save you $$$.
Originally posted on our old blog, this Article has been updated on the 13/04/2017.