Outsourced Bookkeeping

28Aug08

For some reason, bookkeeping is not always thought of as a business function to outsource.  I think business owners equate “doing the books” to company control.  Who wants to give up control of their company? 

This, of course, is not the right way to think about it.  Doing your own books takes time away from other business-generating activities, such as business development, sales, customer service.  It is, therefore, costing you money.  Not only is is costing you growth opportunities, but chances are you’re not an expert at accounting.  So, when tax time comes around, you’re paying your CPA extra to re-do the books.

Properly kept books also come in handy when trying to attain funds, either debt or equity.  They help when establishing vendor relationships, and they are absolutely necessary in some sort of liquidity event. 

There are several options available when it comes to bookkeepers. 

Your CPA has the ability to keep your books.  Unless they have a department devoted to it, however, chances are it is cost-prohibitive. 

There are outsourced bookkeepers in virtually every area, and they usually charge by the hour.  The price will range from $40-$70 per hour.  These even come with their options, and you have to identify what works best for you.  Some bookkeepers will come to your office, and enter bills, invoices, receipts, etc. into your accounting software, print checks for you to sign, etc.  This is a great first step for those business owners who are reluctant to give up control.  Keep in mind, however, that you will probably be paying for travel time to and from your office.

Some bookkeepers require, or give you the option, to bring everything to their office.  You go regularly with bills, invoices, statements, etc.  You most likely leave it all there, and the bookkeeper does the books.  You’ll probably go there regularly to sign checks, and pick up checks and deposit slips to take to the bank.

One issue with this scenario is where your accounting software resides.  If the bookkeeper is keeping your file on their system, you won’t have access to it in the case that you need it.  If a client or vendor calls and needs to know about the status of their account, you won’t have that information at your fingertips.  There is the option to email the accounting file back and forth, but you have to be very careful as to which version you’re working on.  You don’t want to make changes to a previous version of the file, send it back to the bookkeeper, and all their work inthe interim is lost.  Another problem with emailing the file is that the file sizes get to be large, and difficult to email.  they end up taking space on email servers, and sometimes even get flagged as spam.

To combat the issue of the accounting versioning, there are several services that will host your accounting software, allowing both you and the bookkeeper to work on the file, and not need to send the file back and forth.  These services include: ITX, Quickbooks Hosting.  There are also other hosted accoutning software applications – this article from ReadWriteWeb details some of these apps.

For the more tech savvy, there are services that combine the bookkeeping with the hosted Quickbooks.  One such service provider is Growthforce.  Growthforce offers extreme efficiency by, not only hosting Quickbooks, but also downloading credit card and bank statements straight into Quickbooks.  They pay your bills online, and really limit the time you need to spend dealing with any bookkeeping issues.

The best way to determine if these services are valuable for you and your business is to really pay attention to the amount of time you spend dealing with bookkeeping issues.  If that time could be put to use in growth opportunities, it’s probably time to start looking for an outsourced bookkeeping option.

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