If your business is growing in revenue and customer demands, you already may feel some extra burden doing all company tasks by yourself, including bookkeeping. For those who run a small business and wonder what decisions to make regarding the financial data, it’s important to understand the difference between in-house and outsourced bookkeeping in order to choose which one is better for implementing a system for tracking your income and expenses.
Both services cover the same duties but are structured differently and, in this article, we are going to guide you on the details you must consider if you’re thinking about hiring an outsourced bookkeeping service or an in-house professional to help you make more educated decisions, then, spend your money strategically.
What’s Outsourced Bookkeeping?
Answering straightforward, outsourced bookkeeping means hiring a third-party service or a freelance to record all the financial transactions of your business. Outsourcing allows small businesses, startups, entrepreneurs, and independent professionals to save time from bureaucracies and doing tedious tasks at a lower cost than hiring a full-time bookkeeper, which is actually unnecessary for this stage, without compromising efficiency. Another advantage of hiring outsourced bookkeeping is that you don’t need to worry about the physical space of your office or where to allocate in the co-working space plus avoiding the headaches of missing deadlines.
Until $1 million in revenue, hiring outsourced bookkeeping is a simple solution as businesses aren’t likely to keep a bookkeeper busy every day and assume more operational costs with salaries. At this stage, it would be enough to hire a bookkeeping professional from one to three days a week, or even part-time depending on your financial demand. Otherwise, outsourcing fits well for recording all your financial activities and maintaining the general ledger.
What’s in-House Bookkeeping?
Hiring an in-house bookkeeper may be pointless at the early stages when you need to prioritize translating concepts and ideas to tracked records. However, in-house bookkeeping is worth considering when you start to observe trends signing your company is grounding and think strategically about how to manage your business cash flow.
An in-housing bookkeeper performs similar functions to what an outsourced one does but the big difference is that an in-house holds the responsibilities on behalf of the company. The advantage of having an in-house bookkeeper is on direct access to a certified professional when any question arises about financial reports and statements, and on keeping all your financial documents organized at your office.
From the moment your business overcomes the $1 million mark, it’s time to seriously hire a full-time in-house bookkeeper, so as when you’re calling your accountant often enough for a daily visit to your office. Or hiring a part-time bookkeeper may still be better depending on your needs.
When hiring an in-house professional, make sure of screening his professional background to reduce as much as possible the risk of frauds on your finances, since there are more chances to happen when someone has access to your bank account as part of his duties.
How Can QuickBooks® Help?
By using QuickBooks®, bookkeeping becomes much easier as you can take advantage of technology for accurate financial reports of your business all the time. Our team does all the day-to-day paperwork tracking your expenses, managing your invoices, and assuring that every cost has been recorded. In the end, we do all the job of sorting out your expenses as well as save you from the pain of keeping all the receipts, missing payments, and billing customers incorrectly. Whether you decide to hire an outsourced bookkeeping or an in-house professional, QuickBooks® in both cases can ensure an accurate flow of information for your accounting system.