If you are a small business owner, then you will likely be familiar with how time-consuming bookkeeping can be.
Proper bookkeeping is vital and helps to ensure that your company’s finances are in order but this process can take up valuable time and effort that could be better spent focusing on the business itself to generate more revenue.
In fact, on average, a small business owner will spend around 10 hours a week balancing their books. Luckily, there are a myriad of accounting companies that provide bookkeeping services for small businesses. This will prove to be a valuable asset to you and your company as it helps your business run smoothly whilst allowing you to spend more time growing your brand.
Here are just some of the ways that professional bookkeeping can help your business operate as efficiently as possible
Ensures your cash flow is adequately tracked
Actively managing your cash flow is essential in order to maintain seamless business operations and to ensure that your company does not run out of money. As part of an accounting firm’s bookkeeping services, they can take on the burden of checking the numbers for you – they will often do this using accounting software with automatic bank feeds to record daily transactions, which significantly streamlines the process. They can also alert you to any potential cash flow concerns, allowing you to adapt your business practices accordingly.
Gives you time to focus on the bigger picture
When tracking your company’s finances, it is easy to get bogged down in the detail and lose sight of the wood for the trees. One of the major benefits of having an accounting firm carry out your bookkeeping is that with them being responsible for the tracking and recording of detailed figures, this gives you the freedom to devote more of your time concentrating on the broader business strategy without having to worry as much about the minutiae.
Guides your decision-making
When you have an effective bookkeeping service in place, you will be able to use the records to get a clear picture of where your company is and how it is performing. This will in turn assist with informing your business decisions, as you will have a basis for determining which business practices to adopt or abandon in order to increase your revenue and grow your business. It will also give you a realistic idea of where your company will be when projecting future success.
Provide accurate accounts
By leaving the bookkeeping to fully trained professionals, you can rest safe in the knowledge that your accounts are accurate. Not only will this give you the full picture of your business’s financial situation, thereby allowing you to make informed decisions on the direction of the company, but it is also a legal requirement to file accurate accounts reports to HMRC. Having a professional bookkeeper handle this for you will ensure that all the required records are up to date in time for any tax submission deadlines, making this process as stress-free as possible.
Minimize accounting costs
It is important to note the distinction between an accountant and a bookkeeper. An accountant is an individual who will largely focus on preparing statutory returns and providing financial, business, and legal advice. In contrast, a bookkeeper specializes in the organization of the financial recordings of a business. Whilst both services are useful, when it comes to managing your daily transactions and running monthly payroll, you will typically save a significant amount of money by hiring a professional bookkeeper over an accountant.
Makes your value clear to investors
If you have reached the stage of deciding to grow your company by engaging with outside investment, an effective bookkeeping service can be vital for this. Investors will be unlikely to engage with your business if your finances are not sufficiently organized, as they will not want to take a risk with you. By having clearly organized accounting records, you will be able to clearly show your business’s current and projected financial standing, thereby making you significantly more viable for investment.
These are just some of the ways that a professional bookkeeping service can benefit you as a small business owner. As highlighted above, bookkeeping is about more than just keeping on top of admin, and can provide a range of uses, from improving your decision making, to giving you more time to dedicate to other areas of the business, to making you more attractive to investors.