Accounting: Making Sure 2 + 2 = 4

Do You Spend Too Much Time on Bookkeeping? These Are 3 Critical Signs You Should Invest in Bookkeeping Services

7 January 2021

Dwayne Barnes

If you own a small business, you will always strive to keep your firm's overhead costs as low as possible. For this reason, you will always try to run most of the operations on your own, including bookkeeping. But as your business grows, keeping track of your financial records can overwhelm you. That is where professional bookkeeping services come in. A bookkeeper will help you record and organise your financial transactions, enabling you to focus on income-generating responsibilities. Below are three signs that it is time to hire a professional bookkeeping service.

You Barely Have Time for Your Books

One of the tell-tale signs that you need help with bookkeeping is when you start to experience time limitations. Naturally, a growing business comes with a new set of duties. The more your business grows, the bigger your client base grows. Because of that, you might lack adequate time to update and balance your financial records daily. A backlog of unrecorded papers means more work for you in the future. The solution to time constraints is outsourcing bookkeeping services. By doing this, you will have extra time to execute other things on your to-do list.

You Have Many Inaccurate Records

Bookkeeping is an intricate process that demands attention to detail. Recording and balancing transactions in haste can lead to mistakes. Erroneous data entry can be costly to your business. Making wrong entries prevents you from gauging the financial position of your company. Besides, without proper financial records, you might end up overpaying your taxes. Therefore, if you are constantly encountering mistakes in your books, it is time to hire a bookkeeping service. A bookkeeping expert will ensure timely and accurate recording of your financial transactions. You will have a true or real picture of the financial position of your small business, which will help you in making wise or informed financial decisions.

You Can't Keep Up With Your Cash Flow

Keeping track of the cash flow is crucial when running a small firm. A cash flow statement shows you how money is entering and leaving your company. For instance, it indicates the amount you expect to receive from your clients and the cash you owe your suppliers and contractors. With the statement, you can allocate funds to different activities. Preparing and updating your cash flow statement can be a tedious job to do on your own. It is one of the reasons why you should outsource bookkeeping services. A professional bookkeeper will track your receivables and payables so that your cash flow stays updated all the time.

Hiring a professional bookkeeping service is not only inevitable but also extremely important for a growing business. If you find yourself in any of the above situations, it is wise to outsource your bookkeeping needs.

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About Me

Hello. When you are at school, maths can seem so complicated at first. But then you learn about numbers and all of sudden everything seems as easy as 2 + 2 = 4. I used to be pretty good at maths so when I started my own business, I didn't think I needed to hire an accountant. After all, why should I pay someone else to do something that I could do myself? However, I very quickly learnt two important lessons. Lesson one was that accounting and doing the books will take a lot longer than you might think and, secondly, it is actually pretty complex stuff. In the end, I decided to hire a professional accountant. He is great and he has taught me a lot of cool stuff.