As a small business owner, are you spending the majority your day running your business when you should be growing your business? When it comes to managing the books, you could consider bringing on a costly in-house bookkeeper to track your financials. Or, make the switch to an outsourced provider to save time, money and quite frankly, the headache that comes with bookkeeping.
Here are seven signs your business needs outsourced bookkeeping services:
You Want to Spend More Time on Your Core Business
Back office functions like payroll, inventory reporting, as well as managing receivables and payables are essential. But they take a significant amount of time away from your core business. They are not revenue generating or strategic, which means that you are inhibiting your business’ growth potential when you spend a big chunk of your time on them.
Outsourcing your bookkeeping needs transfers these critical tasks to a team of experts, freeing up your time to focus on value-added activities such as building better client relationships, exploring new partnerships and expanding your business.
You’re Worried About an IRS Audit
The IRS may select your business for an audit for any of the following reasons:
- Your Document Records Don’t Match – If the payor records, such as Forms W-2 or Form 1099, don’t match the information that you reported when filing your business taxes. The IRS wants to ensure information is “reported correctly according to the tax laws and to verify the reported amount of tax is correct.”
- There Are Issues With Related Examinations – “We may select your returns when they involve issues or transactions with other taxpayers, such as business partners or investors, whose returns were selected for audit,” states the IRS.
- Your Business Was Randomly Selected – Sometimes returns are selected based solely on a statistical formula that the IRS uses to spot check the millions of tax forms that are filed each year.
Doing the books on your own leaves the door open to careless errors or omissions that would obligate the IRS to investigate further. Hiring an outsourced bookkeeper like RQB reduces the potential for IRS audits by ensuring that your financial records are accurate. In the event that you are summoned for an audit, RQB makes it easy to substantiate anything that the IRS may question by keeping track of all your income, expenses and documentation in one, convenient, easily-accessible location.
RELATED: What happens during an audit?
Your Part-Time in-House Bookkeeper Has Let You Down Too Many Times
Many small business owners choose to hire a part-time or full-time bookkeeper. Although this might seem like a smart strategy, you are in effect, placing all your eggs in one basket. What if your part-time in-house bookkeeper:
- Doesn’t keep up with changing tax regulations?
- Goes on vacation for two weeks? Or worse case,
- Leaves you entirely?
Although this is a conventional way to find a bookkeeping solution for your business, when you’re relying on a single person to keep your books up-to-date it leaves your business at risk. By hiring an outsourced bookkeeper, you gain access to an entire team of professionals who are available whenever you need them to be. This ensures business continuity and also gives you peace of mind.
You’re Paying Too Much for Bookkeeping Services
Aside from the risk of entrusting your precious financial documents to a single person, there is also the issue of cost. A typical full‐time bookkeeper costs in excess of $42,000 per year and the cost of a part‐time bookkeeper is roughly half that amount.
On the other hand, the average RQB client pays about $350-$400 a month depending on which services they choose to utilize with us translating to an annual cost of between $4,200 and $4,800. That’s a fraction of the cost of having someone in-house who may or may not be meeting your business requirements in the first place.
You Want to Make Real-Time Decisions
Outsourced bookkeeping providers leverage cloud technology – so you can access your data at any time, from anywhere and on any device. The more accurate and timely your books are – the better tuned you can be with your business. When this happens, you’ll able to make real‐time decisions based on financial health of your organization. This is vital to the long-term viability of your company.
Data Security is Important to You
As a small business owner, you might have concerns about the safety of storing and accessing your confidential business information in the cloud. The good news is that the cloud is a much safer method of storage compared to a local hard drive. For example, if your desktop or laptop is stolen, the loss of traditional accounting software and data could be catastrophic. Furthermore, there is no need to worry about data backups, software bugs, operating systems crashing or user errors. In the cloud, this is all done effortlessly.
Cloud bookkeeping companies have multiple layers of data protection, security cameras to monitor access to files and the ability to do constant testing for disaster recovery and connectivity. For example, RQB hosts our client data in a state-of-the-art tier 4 data center locating in Dallas, Texas. Our dedicated servers are always backed up to multiple locations across the country.
RELATED: Is cloud bookkeeping secure?
You’re Starting to Scale Your Business
As your business grows and your needs change, RQB lets you easily customize the scope of work required and tailor solutions to fit your budget. Leveraging our scalability means you get to save the time, cost and hassle of adding personnel in-house. In turn, you can use the additional time and money to gain a competitive edge and scale your own business seamlessly.