June 13, 2024

A Step-by-Step Guide to Outsourcing Bookkeeping for Your Small Business

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The secret is out. Over the years, organizations worldwide have seen a surge in outsourcing, specifically accounting and bookkeeping. Recent data from Accountancy IFA suggests that outsourcing accounting activities has increased by 40% in the last five years alone. Many successful small businesses have taken to outsourcing their bookkeeping to free up their time and have more flexibility, accuracy, and insights into their financials from dedicated experts. In addition, it’s the most cost-effective option for businesses of all sizes.

That leaves one question. As a small business, where do you start? What factors should you consider when deciding to outsource your bookkeeping? In this article, we’ll give you the confidence to make an informed decision. We’ll lead you through each step, from assessing your needs and current financial status to what to look for in bookkeeping services and monitoring it for its efficacy and security!

Benefits of outsourcing bookkeeping services

You may do your own bookkeeping or accounting processes if you're a small business owner. You take the time to fill out financial reports or hire an expensive internal accounting team to handle your bookkeeping work. When you hire a virtual bookkeeper, you outsource your day-to-day operations and ensure business growth. Virtual bookkeeping is also the most affordable approach to handling your financial accounts, payroll, and tax preparation.

A dedicated account manager handles payroll, taxes, financial accounts, and other bookkeeping tasks, giving you more time to focus on your business objectives.

How outsourced bookkeeping works

Outsourced bookkeepers and accounting services work by doing all the financial management for your business. When you outsource your bookkeeping, you get more accurate financial reporting, aid in the tax filing process, management of your bank accounts, and more. This helps you understand your business finances, leading to better decision-making and cash flow through accurate financial reporting.

Now that you fully understand the benefits of outsourcing bookkeeping and accounting needs let's break down the steps to finding the best-outsourced bookkeeping companies.

Assessing your bookkeeping needs

Why is it so critical to understand your needs when outsourcing your bookkeeping? After all, doesn’t the company you choose do that for you?

While an outsourced bookkeeping firm can help you organize and understand your financial health, several factors may change what service you choose and what price point makes sense for your business.

3 Financial factors to consider in the bookkeeping process

Before hiring outsourced bookkeeping work, clearly define your bookkeeping requirements. You will want to understand three critical elements of your business.

Volume of Financial Transactions

How much does your company gross? How many transactions does your business bring in on a monthly, quarterly, or annual basis? Understanding your transaction volume will help you determine the pricing model to look for in a virtual bookkeeper and what size business they serve.

For example, a small business that comfortably grosses $30,000-$60,000 in revenue may not need the same intensive services as an enterprise-level corporation. Be sure to create a detailed list of what your business goals are and what financial needs you have to get there. That way, your outsourced bookkeeping company can report on your cash flows.

Financial reporting needs

Do you require detailed reports for investors or tax preparation? Or do you need a better understanding of your bills and other expenditures? Some bookkeeping services focus on specific areas of reporting and preparation. Understanding what insights your business needs will help you make a better decision. The next step will help you determine exactly what kind of reporting is most important for your business.

Industry-specific requirements

Maybe you have a real estate business where getting tax services is essential, or you’re in e-commerce and need insight into where you can cut costs. Understanding your industry-specific needs will help you find the right bookkeeper. Be sure to think through any specific accounting regulations or reporting needs unique to your industry. By detailing your specific situation, you can move on to the next step with an understanding of your bookkeeping needs and priorities.

Researching and Comparing Bookkeeping Service Providers

Partnering with the right bookkeeping partner is crucial for the success of your outsourcing. The challenge is, according to data from IBISWorld, there are currently over 300,000 bookkeeping firms in the United States alone. So, how do you choose the right one? To narrow it down, consider the following factors.

Look for experienced and professional bookkeepers

You must look for an online bookkeeping service provider with a proven track record of working with businesses similar to yours. As we stated, a bookkeeping firm specializing in helping small businesses grow will be much more beneficial than an enterprise-level model. Be sure to research how long the service has been operating and how many clients it serves.

Check for reviews and reputation

To narrow your search further, you need to find out the experience other clients have had with the virtual bookkeeping and accounting firm. Check online reviews and Trustpilot ratings to understand the pros, cons, and potential red flags that might influence your decision.

Technology solutions and software

Many outsourced bookkeeping services leverage tools and bookkeeping software like QuickBooks or Xero to give you real-time, accurate financial statements. Other companies can help integrate your current software into their services. Ensure the outsourced bookkeepers you're researching use cloud-based accounting software that integrates seamlessly with your current system.

Get started with Precise Ledger LLC

To get you started on your search, Precise Ledger LLC stands out as one of the most reliable and affordable options for small businesses seeking exceptional bookkeeping services. They have a highly experienced team of professionals, a proven track record, and a commitment to personalized solutions. This will help you streamline your finances and achieve your business goals.

Preparing your financial records and systems

When you choose an outsourced bookkeeping service, you will want to ensure a smooth transition. A good move to outsourced bookkeeping begins with organized and accessible financial records. Let’s explore how to prepare your books.

Gathering and digitizing your records

At this junction, you must gather all the relevant documents:

Invoices
Receipts
Tax documents
Bank statements

Gather financial records from at least the last two years. Include anything that shows your financial history and data. Once you have access to these records, the best practice is to digitize that information. You can opt for a scanner or scanning app to turn your physical statements into digital PDFs.

Leveraging cloud-based accounting software

Many small and medium businesses use bookkeeping software like QuickBooks. It’s a safe and secure app that tracks all your records. Many services utilize this technology, making it much easier to access and collaborate with your outsourced bookkeeper.

How to work with your outsourced bookkeeper

At this point in your outsourcing process, you’ve likely narrowed your search to the best fit for your business needs. Now, we’ll dive into how to optimize and maintain that relationship for the best long-term outcomes.

Communicate Your Needs and Expectations

Clear communication and collaboration are essential for an effective relationship with your bookkeeper. That way, they can understand your goals and provide actionable financial insight.

Schedule a consultation or discovery call

When scheduling a call with a bookkeeping service, you can discuss your business's unique financial situation, goals, and preferred reporting format. You can also learn exactly what the firm offers in its pricing models and start personalizing a plan according to your small business needs.

Clearly outline your expectations

Your bookkeeper should know and understand your expected turnaround times, communication channels, and the insights you need in detail. Clearly defining your expectations can help ensure that the partnership is right for both parties and will yield long-term results.

Maintain regular check-ins

Ensure your outsourced bookkeeper allows open, ongoing communication, helping with your evolving needs and strategies. A good bookkeeping service can help your business capitalize on financial opportunities, helping your business grow. Check-ins can also help you know when to scale your plan to manage more aspects of your finances.

Establish Security Measures and Protocols

Once you’ve established clear and healthy communication, it’s time to ensure the security of your most sensitive information.

Choose a bookkeeping service with robust security measures

Your financial security should be a priority. A trusted bookkeeping service should utilize the latest technology to store and encrypt your data while ensuring secure communication channels.

In practice, this will look like:

Using secure platforms rather than public channels (Ex: email or text).
An encrypted client portal with two-factor authentication.
Protocols on your preferred communication methods.

Bookkeeping services like Precise Ledger LLC understand the vital importance of security and prioritize the safety of your financial data. Using industry-leading practices, we safeguard your information, giving you complete peace of mind.

Monitor and Evaluate Your Outsourced Bookkeeping

Now that you’ve outsourced your bookkeeping to a safe, efficient, personalized service, it’s time to monitor the results. Regular monitoring ensures your outsourced bookkeeping solution delivers on your expectations and helps you achieve your business goals. Get in the habit of tracking key metrics like accuracy, responsiveness, and timeliness. You can then use this data to give feedback to your bookkeeper and make adjustments where needed.

Remember, outsourcing your bookkeeping aims to free up time, find financial flexibility, ensure accurate reporting, and more.

Precise Ledger LLC: Your partner in outsourced bookkeeping

At Precise Ledger, we know the challenges small business owners face daily. Here's what sets Precise Ledger apart.

Experienced professionals

To ensure the long-term success of your business, we employ a team of highly trained and qualified bookkeepers who are eager to bring success to small businesses. Our bookkeeping team has a proven track record of working with small businesses across many industries.

Customized solutions

Every business is different. That’s why we take the time to learn your needs and tailor our bookkeeping services to you. Whether you need help setting up your bookkeeping software or account reconciliation, we have you covered.

Exceptional customer support

Precise Ledger LLC is fully committed to providing its clients with ongoing support and guidance throughout the process. Business owners will never have to worry about understanding their financial data, reporting, or planning. With Precise Ledger LLC, you are guaranteed a hassle-free, time-saving experience. All reporting is accurate and efficient, with a close eye for detail. We also keep our clients compliant by handling your payroll, financial statements, and tax preparations.

Conclusion: Streamline Your Bookkeeping by Outsourcing

Are you ready to relieve a massive burden and focus solely on building your business? With careful planning and preparation, any business can position itself for success by outsourcing with the right bookkeeping partner.

As a reminder:

Assess your needs,
Research and compare your options,
Prepare your financial records and systems,
Communicate your expectations with your bookkeeper,
Ensure security measures and protocols,
Monitor your results.

With these steps, you are guaranteed to find outsourced bookkeeping services that fit your needs. With a trusted partner like Precise Ledger LLC, you get a seamless transition, save time and money, and gain peace of mind knowing all your finances are being managed efficiently.

Let Precise Ledger LLC start handling your bookkeeping now

It doesn't have to be overwhelming or complicated to outsource bookkeeping. With the right approach and a trusted partner like Precise Ledger LLC, you can seamlessly transition to an outsourced solution that saves you time, money, and stress.

Our team of experienced bookkeepers is here to guide you every step of the way, from assessing your needs to implementing secure and efficient processes. With packages starting at just $140 per month, Precise Ledger offers a flexible and affordable way to take control of your financial management.

Ready to streamline your bookkeeping and focus on growing your business? Contact Precise Ledger LLC today to schedule a consultation. Let us help you navigate the outsourcing process confidently.

See what Precise Ledger can do for you

Your Financial Success Starts with a Precise Ledger!

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A Step-by-Step Guide to Outsourcing Bookkeeping for Your Small Business

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