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Bookkeeper vs. Accountant: Different Services for Your Business

How often have you heard the terms “accountant” and bookkeeper” used interchangeably? If you don’t know about the differences in the services, then it is easy to see how you might be confused about these professions.

Yes, both accountants and bookkeepers work with financial reports, organization, and tracking. In fact, the services offered by an accountant and bookkeeper often overlap. Some firms offer both bookkeeping and accounting services. But their purposes, focus, and skillsets vary depending on the person that you hire.

Services from a Bookkeeper

The term “bookkeeping” is used in reference to services that are rendered for organizing, storing, recording, and retrieving financial information. Usually, a bookkeeper is involved in the ongoing transactions that are moving through your bank account. This person oversees a portion of the accounting process, usually focused on the classification and recording of the daily transactions such as bill payments, payroll, sales, and more.

The purpose of hiring a bookkeeper is to maintain the organization and accuracy required to ensure correct information on financial reports. A bookkeeper spends their time working on record keeping. They don’t spend as much time on analytics or financial strategy.

Keep in mind that a bookkeeper isn’t required to have a four-year degree. As a result, bookkeepers usually have less education compared to accountants.

Services from an Accountant

The accountant uses the information that was compiled and organized by the bookkeeper. Often, accountants are involved in tax strategy, tax filing, financial reviews, auditing and more. Accounting services take it a step beyond bookkeeping services by analyzing the reports, reviewing the information, identifying trends, and interpreting the information. When the data is turned into reportable information, then you can use the details as you are making big decisions for your company.

Accountants are required to complete a four-year degree as well as extensive training and certifications. These requirements ensure that your accountant understands the financial laws, strategies, and other steps that need to be taken to care for your business finances.

Different Stages of Financial Management

As you can see, the services that come from a bookkeeping team and accounting team go hand-in-hand. Even though their services are different, these professionals often work in tandem. The combination of a strong accountant with a detail-oriented bookkeeper is essential to bring clarity to your business finances.

If you need someone to help with the day-to-day processes, then you will likely benefit from the support of a bookkeeper. On the other hand, if you are looking for support with the bigger picture and tax strategy, then you should turn to an accountant for support.

When it comes to the daily and weekly financial management, a bookkeeper can support with a range of tasks:

  • Tracking transactions moving in and out of the financial accounts
  • Managing and logging transactions to ensure accuracy on the reports
  • Evaluating payments, sales, receipts, and purchases
  • Calculating payroll and processing payments for employees
  • Overseeing invoices and payments for contracted workers and suppliers
  • Monitoring accounts receivable to ensure cash flow throughout the month
  • Completing monthly financial closing and bank account audits as needed
  • Using bookkeeping and accounting software to ensure accuracy

Keep in mind that the bookkeeper’s activities and tasks vary depending on the size of your company and the transactions that are moving through the account each day and week. When many transactions are coming through each day, then you might need bookkeeping services throughout the week. But some small businesses don’t need the services of a full-time bookkeeper, so it often makes sense to hire an outsourced bookkeeper instead. Typically, the services of the bookkeeper will expand as the business grows.

As you look over the bookkeeping tasks, you can see that they provide the foundation needed to support your business financial health. Then, the accountant steps in to use the data generated by the bookkeeping activities. Accounting services often include:

  • Tax analysis and strategy to minimize payments to the IRS
  • Completion and filing of income tax returns
  • Answering questions and helping business owners understand the applicable financial regulations
  • Financial statement analysis and business strategy support

Do You Need an Accountant or Bookkeeper?

How do you know who to hire when you need financial support for your company? It is important to distinguish the services so that you can choose the level of expertise required for your business.

While a bookkeeper is a cheaper solution, they don’t offer the financial expertise that comes from a small business accountant. In most cases, business owners find it beneficial to engage the services of both a bookkeeper and accountant, with the bookkeeper working on daily transactions and the accountant offering periodic advice.

Don’t overlook the benefits of a financial team that can provide both bookkeeping and accounting services. It can be beneficial to keep all of these tasks with the same team, ensuring optimal communication and the best strategy when everyone is working together.

How to Tell When You Need Financial Support for Your Company

Is it time for you to hire a bookkeeper or accountant? It might feel like a challenge to determine the right timing in bringing in a financial professional. But, as a business owner, remember one important tip: it’s never too early to bring in accounting and bookkeeping professionals.

Even if you are just getting your startup off the ground, you have the opportunity to work with an experienced team. This professional advice can help you create the right financial foundation and set your company up for success in the future. Business owners who hire accountants and bookkeepers in the early stages of growth rarely regret the decision.

Benefits of Hiring an Outsourced Accountant

It probably doesn’t make sense for your small business to hire a full-time accountant. Bringing on another in-house employee raises your overhead expenses and puts added financial strain on your cash flow. Instead of hiring an employee, consider the benefits of using outsourced accounting services.

The main benefit of outsourcing this part of your business is that you can save both time and money. You don’t have to spend your hours crunching the numbers and trying to make sense of the financial reports. Instead, your attention can turn back to business-building activities because you have the peace of mind in knowing that your accounting and bookkeeping team is taking care of the tracking and analysis.

Plus, these services are essential to help you save money. Even though you will have a bill to pay for outsourced accounting services, you will likely find that you save more money overall. Here are a few financial reasons why you shouldn’t delay the services of an experienced financial team:

  • Improve Tax Strategy: One of the most frustrating aspects of owning a company is seeing how much money goes out the door when it’s time to pay the IRS. Taxes can cut away at your profit margins and make it hard to manage cash flow. An accounting team can evaluate your business and finances, then find the right strategies to minimize the tax burden that needs to be paid each year. These savings can add up to thousands of dollars… often more than you paid for the accounting services.
  • Reduce Error: Consistent tracking and bookkeeping help you avoid common errors that could affect your business. For example, if you don’t have a good system in place to keep track of invoices, then you might overlook payments that should have been made by your clients or employees.
  • Avoid Fraud: Keeping an eye on the financial transactions is essential so that you can avoid fraud and theft in your business? Regular audits, reviews, and analysis will help to uncover anywhere that money might be slipping through the cracks. Even though you should be able to trust your team, you should still have systems in place in case something happens.
  • Increased Revenue: When you spend more of your time on business development and marketing, then it increases the chances that your revenue will go up. As the business owner, you shouldn’t be focusing your efforts on the busy work that can be completed by a bookkeeper or accountant. Your time is valuable, which means that you should be spending your hours on activities that will bring in more money for your company.

At Easier Accounting, we know how important it is that you have a good financial team to support your business goals. We’ve been serving small business owners for many years, offering the best financial services available in the industry. Our goal is to not only ensure your satisfaction, but we go above and beyond to provide unbeatable solutions that will support the growth of your company.

If you have questions about accounting and bookkeeping services, then it is time to contact our company today. We have a team of experienced financial professionals who are ready to create a custom plan based on your needs. Easier Accounting is always here to help. You can call us during regular business hours to learn about the services that are available: (888) 620-0770.

Why it is Always Best to Outsource Bookkeeping Services

It’s no surprise that a lot of work goes into bookkeeping and accounting for a company. If you are a small business owner and you are working on financial systems for your ongoing transactions, then you might think that the best option is to hire an in-house employee to handle the work. While there are a few benefits to an on-site employee, don’t overlook the benefits of choosing to outsource bookkeeping services. Once you see how easy and affordable it is to outsource this work, you will wonder why you didn’t choose this option long ago.

How are You Spending Your Time?

If you want your business to grow, then you need to be spending your time on activities that will boost your results in the future. Business owners need to be looking at product development, relationship building, employee management, marketing, and other activities that will bring in more income.

The problem is that too many small business owners try to wear multiple hats throughout the day. Instead of focusing on the most important business building strategies, it is easy to get caught up in the paperwork and busy work that needs to be addressed to keep the company running.

If you are spending your time calculating payroll or preparing customer invoices, then you are missing out on potential chances to grow your company. It’s hard to calculate these opportunity costs. But, you need to know that you are leaving money on the table if you are spending your time on low-level work.

It is time to change things so that you can boost your success in the future. Which means that you need to evaluate the benefits of outsourced services. Ultimately every business owner reaches the realization that ongoing tasks need to be outsourced and delegated. Instead of procrastinating a new system, it is best to implement these changes right away so that you can enjoy the benefits as soon as possible.

Benefit #1: Reducing Costs

There’s no doubt that you will save money by not hiring another full-time employee. There are times when employees need to be brought into the company. But, you need to understand the full picture of the costs that will be incurred every month to keep this employee in-house.

The person’s salary is just the beginning of the expenses that you need to carry. Additionally, you also need to pay for benefits, office space, computer equipment, employment taxes, and more. Compare these costs with the amount that you will pay for ongoing accounting services. You will see that outsourced accounting and bookkeeping is a fraction of the cost compared with hiring an employee.

Benefit #2: Decreasing Tax Burden

At the same time, you can also reduce the amount of money that you are spending on taxes. When you have a good bookkeeping and accounting team, you can rest assured to know that you are maximizing tax write-offs as much as possible.

It is important that you have a support team that understands how the tax law applies to your business efforts. As a business owner, you don’t have the time or energy to read the fine print in the tax law. It’s too much information to cover! Instead of trying to decode the information, it is better to hire an expert team who knows the tax law inside-out. Personalized recommendations can be formed to help you optimize your write-offs.

Additionally, you also need to think about the potential cost if a tax filing is submitted incorrectly. For example, it might be tempting to take a DIY approach with your filing this year to save a little money on the accounting preparation fees. Yes, you might save a little cash. But, you could be facing thousands of dollars in penalties and fines if something is wrong on the paperwork.

The IRS takes it seriously when incorrect tax returns are filed. Don’t put your company at risk by filing the return without an experienced team to help. Instead, you can outsource the ongoing bookkeeping services to make sure that you are ready for the annual tax filing. This complete financial package is a great way to help you save money and be ready when tax time rolls around.

Benefit #3: Maximize Your Hours Each Day

How are you doing with your time management each day? If you are focusing on the busy work, then it is probably hard to keep up with all of the other tasks that need to be addressed throughout the week. Outsourcing your bookkeeping responsibilities will free up your time so that you can focus more on the operational aspects of running a company and managing employees.

As you free up your time, you will find that you have more opportunities to be aggressive with your business efforts. You know the best ways to sell the products and services that you are offering your customers. Why not turn your focus to these efforts instead of wasting your time with the paperwork?

Staying at the front of all business activities is the best thing that you can do for future success. Lead by example and work side-by-side with management and employees. Don’t keep yourself stuck behind a desk because you need to go through the never-ending paperwork and bookkeeping tasks. In addition to having more time for the necessary business management, you can also free up your personal time to spend more quality time with your family and friends.

Benefit #4: An Outside Perspective

Too often, business owners get tunnel-vision when it comes to the way the company is run. It is easy to get stuck in the same habits and patterns, especially when you are trying to keep up with everything that is going on. Instead of assuming that everything is fine, it can be helpful to bring in an outside perspective to improve your systems.

When you have an outsourced bookkeeping and account team helping with your business efforts, it means that you have the opportunity to tap into a team of experts who know the best strategies to help your company grow. These finance professionals will bring years of experience to the table. You can tap into that knowledge based on the strategies that are applicable to your company.

Bookkeeping and accounting services are more than basic paperwork services. You can lean on the experience of your outsourced team to gain insights into tax strategy, cash flow, and other financial concerns relating to your company. Take advantage of the strategic planning to increase the likelihood that your business will grow in the future. The insights that are offered can only come with experience. Since you don’t have the same financial experience, it makes sense that you should implement a proven system instead of trying to reinvent the wheel.

Benefit #5: Improve Cash Flow

There are various ways that bookkeeping and accounting services can be used to improve your cash flow. This cash flow is the lifeblood of your company. If you don’t have money to pay the bills, then you can’t keep up with the overhead costs that are required to keep your company in business.

An accounting team can help you look for ways to reduce interest costs, overhead expenses, payroll expenses, and more. Plus, you can also evaluate possibilities to optimize inventory management so that you don’t have a bunch of cash tied up in the warehouse. The goal is to keep more money in your business so that the cash is always available when you have expenses that need to be paid.

Benefit #6: Options to Scale in the Future

Keeping certain tasks in-house will limit your scalability in the future. If you are anticipating large growth, then you need to be sure that your financial system can accommodate the changing needs of the company. When you outsource bookkeeping services, you can rest assured to know that your team knows the best adjustments that need to be addressed to keep up with the growing requirements for your company.

Then, your business can grow naturally and organically, without the requirement to hire more employees or train staff on the paperwork that needs to be handled. It is easy to minimize the growing pains when you have an experienced team that is already in place.

Should You Outsource Bookkeeping Services?

As you consider the option to outsource bookkeeping services, you will see that this step might be the key that is needed to create the business success that you desire. It’s no secret that you need to manage the finances for your company. So, it makes sense that you should bring in an experienced team to help with the ongoing tasks that need to be addressed.

If you need help with your small business finances, then right now is a great opportunity to talk to us at Easier Accounting. We focus on small business services. This specialty enables us to provide better solutions for our customers because of the ongoing, hands-on experience that we can offer. Learn more about the services that are available by calling our team for more information: (888) 620-0770

What Type of Accountant do you need for Your Small Business?

Starting a small business can be hard, especially if you are a first-time business owner. As you are getting started, it is essential that you consider the professional services that can make the process easier. Since you don’t have experience with finances or accounting, you will see that there are many benefits to hiring a professional accountant to help.

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Accounting Experience Matters

Instead of hiring the first accountant that comes your way, take a moment to consider the types of services that you will need. Identifying the services for your company will make it easier for you to find an accountant with the right skill set to match.

For example, a new graduate without experience working for an accounting firm might not be the best choice if you want to be aggressive with your tax strategies. Instead, it is better to hire someone who has been in the industry for a while, so that they can use their experience to help you get the best outcome for your company.

Another reason that experience matters is that of the small nuances in tax law. An accountant with experience in the small business industry will have more related knowledge than an accountant who previously worked for a large corporation. Experience matters, so it is best to find someone who knows how to help in the right way.

Bookkeeper vs. Accountant

Do you need an accountant, or would bookkeeping services be enough? It is common for a small business owner to hire a bookkeeper, only to find that they were in need of full accounting services. There are many advantages to hiring an outsourcing company that can handle both the bookkeeping and the accounting services, such as tax preparation and filing.

By keeping these services with the same outsourcer, there will be more consistency for the year. The bookkeeping maintenance during the year can help you be better prepared for tax time. You will see that there are fewer surprises with your tax filing when you have someone who is helping throughout the year.

Here at Easier Accounting, we can help with all of the financial needs of your company. We know how to help you maximize cash flow and prepare for the future, and we invite you to contact us right away. Together, we will find the best plan to provide the services that will be best for your company. Call us today for more information: (888) 620-0770

Cash Management Tips for Small Business Owners

Every business needs a steady flow of cash to keep the operations running, but sometimes cash flow is one of the biggest challenges faced by small business owners. Without cash flow management, it is impossible for your business to survive. So, it is essential that you focus on cash flow management if you want to be successful with your business efforts.

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Anticipating Future Cash Flow

Instead of only looking at the current balance in your bank accounts, you need to anticipate the transactions that will be coming through so that you can prepare for the future. You might have a positive balance right now, but a big transaction to pay a vendor might drain your account. As a result, you could be facing problems with payroll or other essential aspects of managing your business.

But, if you plan in advance, then you can be sure to have enough money to cover all of the expenses that are needed. Look at the invoices that are coming in as well as the expenses that will be moving out of the account.

Implementing the Right System

One of the biggest problems that will impact cash flow is if a business owner doesn’t have a solid plan in place for their financial tracking. Sometimes it feels like “fire control,” simply trying to come up with the payments that are due right now. It might feel frustrating like you can never get ahead in your business.

Instead of simply bouncing from one payment to the next, it is better to take a proactive approach to planning for the future. The right type of accounting or bookkeeping software can make a big difference. These types of programs will help you see the current account balances, as well as future transactions that will be coming through. As a result, you will be able to make informed decisions about expenses to manage your cash flow more effectively.

Hire a Professional Accountant to Help

If you are having cash flow problems, then it is a sign that you need to bring in a professional to help! Bookkeeping or accounting services might be the best solution to help you keep up with monthly financial tracking so that you can manage your business finances more effectively.

Here at Easier Accounting, we have the experience that you need to help your business succeed. Call us today and we can help you implement the right financial system so that you can improve your business: (888) 620-0770