With so many priorities to juggle at once, being able to leverage an expert can help a small business owner save a lot of time and frustration.
Ask any business owner and they’d likely agree: no part of running your own business is quite as stressful as trying to keep your balance sheet in check! You could do your own in-house accounting; however, seeking the right advice can really make a big impact on your bottom line!
If you can relate, and I’m sure that you can, then this might be a good time to consider hiring a bookkeeper or outsourcing your accounting to an independent accountant or accounting firm. The option you choose can make a big difference in the time you invest, the advice you receive, and ultimately, the amount of money you save.
To help you choose between hiring a bookkeeper or an independent accountant or accounting firm, let’s review their roles to better understand the difference between the two.
Bookkeeper: A bookkeeper’s main responsibility is to record and keep track of the business expenses. If you have a good bookkeeper, they can assist you in identifying suspicious or redundant expenses, which can help increase your bottom line. It is important to remember, that in most cases, a bookkeeper cannot provide any tax advice unless they are a licensed tax professional.
Independent Accountant or Accounting Firm: An independent accountant or accounting firm does everything a bookkeeper does, but can also advise on key decisions with the company’s financial goals. An accountant can help restructure the company’s finances to help with tax efficiency, help manage financial risk, and help forecast potential pitfalls.
The best part about hiring an accountant or accounting firm is the faster turnaround time. Because you are not the only client they have, and they generally work on a per-assignment basis, they will be focused on delivering the work you hire them to do. Having to work under pressure and within a shorter time frame, usually works out in your favour as the business owner who hires them. Also, because you only pay them for what you ask them to do, as opposed to having them monitor your accounts on a micro level at all times, you can save money in the long run.
Ultimately, hiring a bookkeeper or an accountant depends on the needs of your business, and whether you’d like someone to complete specific tasks at certain times of the year, or need someone consistently keeping track of expenses and finances. Review your needs and make sure you have the right expert working for YOU!
Reza Sabour is a BMO Small Business Banker based in Vancouver with 10 years of financial services experience.