The Three Types of Bookkeeping for Your Business Needs

Bookkeeping is an essential component to any business as a business needs to have records of its financial transactions. A bookkeeper is usually required for the process as they are trained and have the needed education to perform the tasks associated with bookkeeping.Whether it is a large or small business bookkeeping is important. A business can do bookkeeping on their own, or hire an outside bookkeeper. There are three types of bookkeeping services that a business can take advantage of: doing it themselves, contractual bookkeeping or hiring an in-house bookkeeper.

Do It Yourself Bookkeeping

Bookkeepers are professionals who have the skills and education necessary to complete the tasks associated with bookkeeping. The books of your business shows how profitable your business is and it is the most powerful level of control in your organization. There are advantages of doing the bookkeeping on your own which include:

  1. Saving money. Since you will be doing the bookkeeping on your own, you will not need to pay anyone else to do it and you save that money.
  2. There are many software and online resources available to help with do-it-yourself bookkeeping. This makes the process not seem so daunting and difficult.

There are still disadvantages to doing bookkeeping on your own as mistakes can be made which would in turn cost your business more to fix.

Bookkeeping for Dummies The Three Types of Bookkeeping for Your Business Needs

Contractual/Outsourcing Bookkeeping

Hiring a bookkeeper on a contractual basis is another option for businesses. In today’s world there are ways in which businesses can hire a bookkeeper virtually and communicate electronically. Bookkeeping can be done virtually using cloud accounting software which makes collaboration and sharing of financial data easy. In Melbourne, Australia is a great source for virtual bookkeeping services. The process starts with your business advertising its bookkeeping needs online through websites or through outsourcing companies. Once you hire the person that is qualified, you communicate with the person electronically and then the work is delivered to you according to the contract. Outsourcing reduces your costs and cuts the paper work within your business.

In-House Bookkeeper

An in-house bookkeeper would be more suitable to a growing business.In-house bookkeeping can include hiring a new team member or using an employee already in the business. A qualified bookkeeper will have the knowledge and skills necessary to perform the tasks related to bookkeeping.When you hire a bookkeeper you can focus your energy and time on other meaningful activities in the business. The bookkeeper should however provide you with regular updates and reports on the financials of the business.

All the bookkeeping services have their advantages and disadvantages and so the decision should be made based on the business size, affordability and several other factors. A bookkeeper can offer a business the expertise it needs to keep up with its financials. The comparison with all three services may reveal an in-house bookkeeper as the most expensive as the business will need to purchase the necessary software, recruitment fees (if using advertising or agency), cost of a desk among other things.

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