In doing business, keeping up with well-maintained bookkeeping or accounting is very critical in order to make sure that the fundamental aspect of running the business runs smoothly. Any business has to be aware of this and be able to manage its resources, especially money, really well so that they can avoid unwanted financial problems in the short term or long term of doing the business. There is a huge necessity for the company or business’ financial data to be current and accurate so that the decisions regarding your business can be done right, minimizing errors and bad decisions that may take your business to the wrong turn.
For small businesses to save money, they usually try to handle accounting on their own. However, this can get really overwhelming. Often, the more important things to do in running the business gets abandoned and instead, it doesn’t grow as it should be. This can result badly for the company in the long run.
A solution in order for this not to happen is by outsourcing a bookkeeping or accounting service via an agency like A1 Business. This option has become more common these days.
However, many people are not aware of the difference between accounting and bookkeeping, and they don’t know which is actually more suitable for them.
First of all, let’s start with bookkeeping.
A bookkeeper is someone who handles the recording of the financial transactions of a business that happens daily. These transactions may include payments, purchases, receipts, and other things in between. What a bookkeeper does is then generate data about the activities of a business or organization based on these financial transactions.
On the other hand, what an accountant does is to turn the financial data that has been recorded into information. The job of an accountant revolves around verifying data, analyzing data, creating reports, performing audits, and financial reporting records such as balance sheets, tax returns, and income statements.
To simply put it, accounting’s work tries to view the bigger picture regarding the financial condition of a business. They try to forecast what is coming so that they can give advice and suggestion on how their client can survive with all the obstacles in their way.
Usually, bookkeeping service is enough for small business as the transactions that happen in a small business is not very complex.
It is recommended to outsource the service of bookkeeping or accounting in order to keep a lower operational cost.
Outsourcing the service of a professional bookkeeper or accountant can lead to saving up business money because, in contrast to the in-house accounting staff, an outsourced bookkeeper or accountant don’t need benefits and payroll each month.
The amount of money you must spend on the service may vary, depending on the firm that you are going to work with. That’s why it is very important that you do research before coming into a decision of working with a firm. Usually, a credible one will have its track record displayed on their website. You can read about them and the testimonials from past clients so that you can decide for yourself if they are worth the price they are offering you.