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Choosing Business Accounting Services: Firm vs. Freelance Bookkeeper

One of the best stress-reducing decisions you can make for yourself is hiring an expert to help with business accounting services. You are already carrying enough stress as you are working through the details of employee management, marketing plans, and product development. Add the details of bookkeeping and accounting on top of your daily responsibilities, and it can be a lot to keep up with on an ongoing basis.

It’s understandable that the decision to outsource business accounting services can be a challenge. Not only do you need to hand over the keys to someone you don’t know, but some business owners aren’t sure if it is worth taking on another monthly cost. The truth is that you will receive countless benefits when you finally make the decision to work with an experienced financial pro. This one decision might be the turning point to help your business grow to higher levels of success.

Why Do You Need Business Accounting Services?

If you are getting your company off the ground, then it might seem like an unnecessary expense to hire a financial professional. Is it worth the cost when cash flow is tight? Yes! As you learn more about the benefits of working with an accountant and/or bookkeeper, you’ll see that this expense should be at the top of your priority list.

Many entrepreneurs thrive on DIY, especially when they are just getting started. While there are certain things that you can do for yourself, there are also appropriate times to bring in an expert who can assist with your needs. It can be a challenge to find the time required to keep up with ongoing bookkeeping and accounting responsibilities.

Plus, there is a good chance that you are making avoidable mistakes if you don’t have experience in the financial industry. You wouldn’t try to fill a cavity without visiting a dentist, so why would you try to analyze financial reports if you don’t have an accounting background? Failing to engage the services of a trusted accounting team means that you will be missing out on critical insights that are needed to help your business grow.

In fact, when business owners finally make the decision to hire someone to help with accounting and bookkeeping, these business owners often find that they weren’t doing nearly as well as they expected. Just because you are staying consistent with your DIY system, doesn’t mean you are covering all of the essential aspects required for your financial reporting.

It is common for a financial professional to uncover problems with transactional errors, poorly structured systems for paying bills, and even gross errors in the financial reports. If you want to make quality decisions for your business, then you need to lean on the services offered by an accounting professional.

Considerations: Bookkeeper vs. Accountant

The most important thing that should be considered as you are making this decision is regarding the type of services that are required for your company. Are you looking for someone to help with only tax strategy? Or, do you prefer a full-service approach that includes ongoing support with account reconciliation, financial report analysis, and more?

Even though the term “bookkeeper” and “accountant” are sometimes used as synonyms, there are distinct differences in the services that you will receive from these providers. You should never assume that a bookkeeper can provide all of the services available from a business accounting firm. As a result, you might be missing out on a few key services that are required to support your business needs.

A bookkeeper and accountant share common goals, and their roles often overlap. Here are a few details to help you distinguish the different types of services available:

  • Bookkeeping Services: A bookkeeper is responsible for overseeing the ongoing financial transactions, such as invoice payments, payroll, sales tracking, and more. These transactions need to be recorded, categorized, and reconciled to ensure that details aren’t overlooked in the bigger financial picture. Bookkeepers help with accurate recordkeeping, but the services don’t typically include analysis of financial reports.
  • Accounting Services: When a bookkeeper ensures the business is maintaining accurate record keeping, then the accountant can step in and build on the information that has been recorded by the bookkeeper. Accountants often help with financial statement reviews. The data is taken to the next level with detailed analysis, interpretation, and advice. The goal is to use reportable data in a way that helps with cash flow and business strategy.

So, do you need a bookkeeper or an accountant? In most cases, small business owners can benefit from both services. The benefit of choosing a bookkeeper is that the services are often less expensive, but you will be missing out on the financial analysis available from an experienced accountant. In fact, it often makes sense to spend the extra money on accounting services, because you will be able to recover those costs by reducing your tax load and maximizing your business strategy. Many business owners find the best solution is to choose a team that offers both bookkeeping and accounting services, such as the all-inclusive packages offered here at Easier Accounting.

Comparing Your Options: Firm vs. Freelancer

There’s no question that every business owner needs to tap into financial support. Most people begin with a startup idea, but they have no experience or knowledge regarding the business side of things. Just because you have a product that people are interested in buying, doesn’t mean you have the smarts to handle the books that support your business.

It is important that you understand a few distinctions between the services offered by an accounting firm vs. a freelance accountant:

  • Cost: If you are looking for the lowest price, you will often find the best value for your money by hiring a virtual team. Local accountants need to carry the expensive overhead costs of maintaining a building and other expenses. In comparison, an online team can keep prices low since these costs can be avoided.
  • Timeline: When you are working with a team, such as the services offered here at Easier Accounting, you don’t have to stress about deadlines being missed. Certain deadlines need to be met, such as payroll processing, account reconciliation, and tax payments. A single accountant will go out of town at times, which means that your deadlines might be overlooked since only one person is overseeing your financial needs. In comparison, a financial team ensures you will never miss a deadline, regardless of the personal schedules of the individuals on a team.
  • Experience: There’s no question that you are tapping into a broader range of experience when you choose to work with an accounting team. A local accountant will have knowledge about small businesses in your area, but that experience will be limited since the person is tied to a geographic location. In comparison, an online team has experience working with a full range of companies in many different locations. This spectrum of hands-on experience means they have more to bring to the table regarding the financial services needed for your company.
  • Access: One of the benefits of our digital age is the access to cloud-based software programs. Instead of the need to visit with your accountant in person, you now have the option to work with a team located anywhere in the world. Even if you are on the other side of the country, our team can offer high-quality services through digital access to your financial books. Your business can go paperless, and approved managers and financial pros can access your financial information at any time.

When to Hire Business Accounting Services

The truth is that it is never too early to bring in the experience of an accounting professional. Even if you are just getting started with your new business or you are in the early stages of growth, it is essential you have the support of a financial team that will help you get things off the ground. Business owners who make the decision to hire an accountant early in the game rarely regret their choice.

These services help to build a solid foundation that makes it easy to help your business grow in the future. When you have a solid financial system, then you can avoid common growing pains that occur when other business owners aren’t prepared.

A financial professional can help as you create a plan based on the needs of your company. This system will help you save time, which means that you will also be saving money in the process. You can hand the responsibility to an experienced business accounting service, allowing you to turn your focus to other responsibilities that are required to help your business grow.

If you are considering the option to hire business accounting services, then our team is here to assist. Easier Accounting knows what it takes to ensure financial clarity for your small business. We invite you to reach out to us any time to learn about the services that are provided by our team. We’re here to help with both bookkeeping and accounting services needed for your small business: (888) 620-0770.

How to Leverage Financial Mistakes to Build Your Small Business

It doesn’t matter if your startup efforts are home-based in the basement or if you’ve been in business for years, money management can be a concern for all business owners. Dealing with cash flow, expenses, and billing can be a challenge. In some cases, certain financial mistakes can be enough to force a company to close its doors.

Maybe you’ve identified financial mistakes that have affected your company. Or, there is a possibility that mistakes have slipped by undetected. Either way, it is essential that you have a good accounting system to help you stay on track. Just because financial missteps happen, doesn’t mean that it will be the closing chapter for your business efforts. Instead, these mistakes can often be used to identify weak points in your system, helping you strengthen your business strategy for the future.

Transparency is Key for Success

The most important thing that you need to do is to maintain transparency with your reporting and accounting practices. If a mistake happens, it might be tempting to “brush it under the rug” because you are embarrassed that you didn’t get it right. But we are all human, which means that mistakes happen. Instead of spending your time focusing on the problem, look at the overall picture and identify areas of improvement.

Transparency is the best thing you can do to keep your company moving forward. When you are consistent with financial tracking and reporting, then you can always get a good feel for the current positioning of your company. These details can be used to influence your business decisions, helping to propel your company forward in the future.

So, every business owner needs to look at the foundation of wise financial tracking: do you have a good accounting software and system to maintain transparency with every transaction that moves through your accounts? Creating this system is essential so you can leverage your mistakes for your advantage.

Turning Financial Mistakes into Advantages

How do you put this principle into action? It can be difficult to see where you can make changes after a mistake so that the situation is a positive support for your company. Here are a few examples to help you create the mindset of learning from your mistakes:

  • Cash Flow Complications: When the overhead costs and bills come due, you need to be sure that there is enough money in the bank to cover these expenses. The truth is that most business owners experience challenges with operating capital. Regardless of the size of your business, cash flow is something that needs to be addressed and prioritized. All it takes is one big client who is late with a payment to result in a situation where you need to get creative to come up with cash for payroll or an upcoming tax bill. If you encounter cash flow issues, then it means you aren’t being careful enough in your project estimates. Rework your business plan so that you are more conservative with the monthly estimates. Also, make sure you always have at least 3 months of operating expenses in an emergency savings account.
  • Lack of Diversification: Do you have all your eggs in one basket? Without client diversification, you could be facing issues if the industry shifts. Don’t allow your cash flow to be dependent on a single client. This mistake could leave you in a pinch, but it is also a good motivation to change your processes to ensure it doesn’t happen again in the future. Going forward, be deliberate about reaching out to new, potential clients before the other contracts end. You need to be sure that you have enough in the pipeline to stay busy, even when things change with your current workload.
  • Skipping Project Milestones: When you have a lot of cash tied into one client or customer, you might make the mistake of waiting for a lump sum payment at the end of the project. Unfortunately, payment delays and schedule slippage could result in late payments, which will have a domino effect on other aspects of your business. Learn from your mistake: Instead of aiming for one big payment at the end of the project, set up projects with milestones and incremental invoicing to ensure that the cash flow is still coming through.
  • Business Growth Happens Too Quickly: It doesn’t sound like a bad thing to have your business growing so quickly that you can’t keep up. But, if important details are overlooked, then it could show your company in poor light in the industry. There is a fine balance to ensure that you are keeping up with the growth without leveraging yourself too quickly. For example, not only do you need to ensure you have the inventory to keep up with an increase in product demand, but you also need to be careful to avoid leveraging up the overhead expenses if your cash flow can’t handle it yet. Always be conservative in your forecasts and be careful to manage expansion according to the timeline that your business can carry.
  • Not Following Through on Outstanding Invoices: Consistency with follow-through is essential when it is time to collect payments from your customers. If you aren’t diligent with touching base about the outstanding payments, then it’s likely you won’t receive timely payments. Avoid these financial mistakes by committing to a good accounting system going forward. Organization, consistency, and the right software program can help you identify the outstanding payments so you can be sure that nothing slips through the cracks.
  • Competing on Price: If sales are slow, then it might be tempting to lower your prices so you can bring in more customers. Unfortunately, many business owners find that it’s a race to the bottom if you are only competing on price. Slashing the price of your products or services is only a temporary fix to bring in immediate cash flow. But this decision harms your profit margins, which means you will have less cash to work with for business growth in the future. If you’ve made this mistake, then it is time to redefine your marketing and branding strategy. It is essential you differentiate in the industry based on value for the customers. People will be willing to pay more money if they can see the benefits that will be gained from your product or service.
  • Data Entry Inaccuracies: There is always the risk of mistakes happening on the project. Whether an employee entered a few inaccuracies on the transactions in the accounting software, or someone overlooked a transaction altogether, it can have an impact on the accuracy of your reports. When inaccuracies happen, it means you are making decisions using wrong information. As a result, it could harm your cash flow, potentially resulting in late fees and legal ramifications if payments are missed. This problem can be solved by creating a system of checks and balances. In the future, you can rest assured knowing that nothing is overlooked when you are consistent with monthly reconciliations.

How to Handle the Situation When Mistakes Happen

What is your automatic response when a mistake is discovered in your business? Some people get upset; while other people want to ignore the problem. Before another mistake happens in the future, it is smart to evaluate how you will handle the situation going forward.

Failing fast is key when mistakes happen. Don’t let yourself get so caught up in the moment that you have a hard time moving forward. If money was lost, then view the situation as “tuition” for the education that you learned. Allow yourself to learn from the mistake so you can implement changes that will move your company forward in the right direction. A few small changes can be put into operation, making it possible to avoid running into the same mistake again in the future.

Tapping into Professional Services

The most common reason why financial mistakes happen is that business owners fail to utilize professional services that are available. Even though it might seem smart to save a little cash with a DIY approach, you could be facing a loss of thousands of dollars in the future with a big mistake. It’s worth the expense to bring in an industry professional so you can avoid some of the most common errors in the industry.

One great example is in the accounting industry. As a small business owner, you might try a do-it-yourself approach for tax preparation and filing. But you need to consider the hours and hours that will be required so you can figure out the tax forms and understand the best way to leverage your deductions. Plus, it is likely you could be missing out on thousands of dollars in tax write-offs because you didn’t understand the law. If a mistake is made, then you could be facing fines and fees from the IRS.

Instead, spending a little money for ongoing accounting services can be invaluable to help you avoid the common mistakes made by small business owners. If you are looking for financial support for your company, then Easier Accounting. Is here to assist. Call us at (888) 620-0770.

Goal Setting Strategies for Small Businesses

If you are an entrepreneur or business owner, then it means that you are probably a goal-oriented person. People who are willing to step out of the typical career paths are looking to create a different lifestyle and new opportunities. It can be both exciting and scary to step into new territory and try something different. The upside potential is incredible if you set the right goals. Consider these goal setting strategies if you are looking for ways to improve your business results.

Manageable Growth for Future Success

While everyone wants to be an overnight success, uncontrolled growth could be the factor that brings your company down. You need to be sure that you have the inventory, customer support, and business resources available to manage all of the orders that come in. So, it is important that you aim for manageable growth to ensure that you can sustain it in the future.

For example, instead of setting a goal to double your clients, consider setting incremental goals that can be achieved over a period of time. You might start by aiming to increase your client list by 10% at a time. These incremental steps can move you in the right direction over time, until you reach the ultimate goal in the future.

Don’t sink your company by moving too fast. Instead, be realistic about the services that can be provided for your customers, and aim to move that incrementally so that you can achieve the results that are desired.

Lean on the Experience and Recommendations of Others

It is easy to be narrow-focused on the problems at hand. But, don’t make the mistake of overlooking resources that might be available to help with your business growth. Tapping into outside knowledge and resources can help you avoid some of the roadblocks that come up along the way. You can skip the problems that were encountered by your mentors, putting you on the fast track to achieving higher levels of success.

There are a few key areas of your business where you might consider services and support from others. For example, it can be helpful to bring in an accounting team to assist with the finance strategy. These services will allow you to focus on the daily responsibilities so that you don’t have to spend your time crunching numbers every day. Talk to your accounting team about the goals that should be in place, helping you identify goals that are realistic and manageable.

S.M.A.R.T. Goals for Your Business

One common acronym used in reference to goal setting is SMART: Specific, Measurable, Achievable, Relevant, and Timely. Using this strategy can help you stay focused on the things that matter. Here are the things that you should be considering when you are setting goals:

  • Specific: Setting a general goal can make it hard to identify when the goal has been achieved. Instead of setting a goal to “boost company profits” include detailed numbers that you would like to hit. For example, you might set a goal to increase monthly sales by 10% by the end of the year. When you are specific about your goal, there is a greater chance that it will be achieved compared to a general goal. Answer six important questions to get specific: Who, What, When, Where, Which, Why?
  • Measurable: It is important that you have detailed criteria in place to measure your progress. How do you know if you are going to hit your goal if you can’t track the progress that you are making along the way? A few easy questions can help you identify the measurement of your goal, such as: How many, How much, or how do I know when the goal has been met?
  • Achievable: Find the goals that are most important to your success, but make sure that there are ways to make those goals become a reality. You can achieve almost anything that you set your mind to. But, it can be helpful to focus on incremental goals if the bigger goals seem too far away. Setting goals beyond your reach could be setting you up for failure. Dream big, but also do a reality check to make sure that you can eventually reach the level you are striving to achieve.
  • Relevant: Make sure that your goal aligns with your company mission. Not only do you need to consider your current progress, but you should also evaluate the current business climate and conditions you are facing. Set goals that will have an impact on the way the company will grow, while being in touch with the realities of the market that you are experiencing.
  • Timely: Finally, you need to have a deadline that you are aiming for. These goals won’t be accomplished if you don’t tie a timeframe to the process of setting the goal. For best results, it is a good idea to keep the timeframe within a few months, giving you time to see progress. When that goal is achieved, then you can set the next goal to help you make the incremental steps that are needed in the future.

It is incredible to see the possibilities that are available when you are deliberate with the way you are setting goals. Instead of randomly choosing goals for your company, take the time that is needed to identify the steps that will work in your favor in the future.

Trusting Your Knowledge and Experience

While it is important to be deliberate in the way you are setting your goals based on data and achievable results in the future, there is also a time when you should trust your instinct in the way you are growing your company. You’ve already come a long way to take the steps needed to build a business. Recognize the progress that has been made and look for ways that you can trust yourself and the possibilities that are available for the future.

For example, you might have a feel for the way the business flows throughout the year. During slow season, it might make sense to work on system improvements, such as improving the accounting and bookkeeping system or working on business development. On the other hand, it could be good to set sales goals when you are in the busy seasons of the year.

Examples of Business Goals

Do you need help identifying goals that might be helpful for your business success? Here are a few options that you might consider:

  • More Revenue: Increasing revenue is often the first goal that business owners think about when they are looking to improve their results. You can set revenue goals, or look at other numbers that affect revenue, such as sales, prices, and more. Talk to your accounting team to identify the areas of potential for boosting your revenue.
  • Reduce Costs: While you are increasing your income, it is also helpful to decrease expenses at the same time. If you don’t control your costs, then you will have a hard time maintaining profitability. Review your expenses and find ways that you can cut the recurring expenses to improve profit margins.
  • Manage Debt Load: When you are carrying large amounts of debt, then it means that your cash flow is likely being taken up in monthly payments and interest costs. Set goals to reduce your debt or pay it off completely. These goals will have a lasting impact on your business success since your cash will be freed up for other investments and business development options.
  • Improve Cash Flow: It can be stressful if you are checking the bank account throughout the month to make sure that you have enough money to pay the bills that are coming through. If you are always coming up short with the money that is needed to pay your bills, then it means that you should set goals to improve your cash flow. Create a goal to have an emergency reserve of cash so that you don’t come up short every month.

These are just a few examples of goals that can be used to improve your business success. But, the best goals are those that will have the greatest impact on your results. It is important that you evaluate your company. Look at the historical trends and possibilities for the future. Then, find the areas where you can change your habits and results to create better opportunities to help your company grow.

Talk to an Experienced Accounting Team

Do you have questions about goal setting strategies or other methods that can be used to improve your business finances? Right now is a great time to talk to an industry expert to learn more about the way accounting services can support your goals. If you are interested in learning more, then we invite you to call our experienced team at Easier Accounting. We offer services for small businesses and entrepreneurs. This focus gives us the experience and applied knowledge that ensures optimal results for your company. Call today to learn more about the services that are available We’re here to help: (888) 620-0770