Q and A About Our Bookkeeping and Accounting Service
How Do I Send our Documents for Processing?
The traditional approach is the “shoebox method”. Sales slips, invoices and receipts are tossed in a shoebox, which is periodically delivered for processing. While the slow-tech approach is still used today, the smart-tech method involves depositing electronic document images in a “shoebox” on your desktop. Transaction images can come from your smart phone or scanner; as long as each transaction is supported by some documentation including date, transaction reference, identity of the customer or vendor and amount. We do the rest.
How Much Does the Service Cost?
The short answer is, it depends. The cost depends on the transaction volume, the complexity of the business and the quantity of reporting required. Following a no-cost, no-obligation review of your requirements, we’ll give you an estimate of the cost so you know what to expect.
Is Outsourcing Less Expensive than a Bookkeeper?
Not only could it be less expensive, it may also be more reliable and worry-free.
Consider the cost of a bookkeeper: According to Payscale.com, the average annual salary of a full-charge bookkeeper is $44,500. Add to that, roughly 10% for employer share of benefit costs, vacation pay and statutory holidays. Based on a 35-hour work week, this works out to about $28. per hour. Add in the annual cost of an accounting software subscription, employee office space and the total can be $30. an hour, for every hour the employee reports for work.
By comparison, the hourly cost of a bookkeeping/accounting service can be $40. or more, depending on the provider, the number of transactions and the complexity of the business. While $40. Per hour may sound steep, if the service provider can process all transactions and reports in 20 hours per month, that’s a cost of $800. compared with $4,000. for an employee. You pay for the service you use – no more, no less. And, your bookkeeping/accounting service does not require holidays, sick days or quit with little notice.
If your full or part-time bookkeeper leaves, will you be able to find a competent replacement before your records fall behind? When you interview prospective replacements, how do you assess their proficiency? Are they fully experienced with your in-house accounting software? How long will it take before the replacement is fully functional and proactive?
All things considered, it might be to your advantage to outsource your accounting function.
What About Set-up Costs?
Part of our no-cost, no-obligation pre-engagement evaluation is determining the most cost-effective set-up strategy. Every accounting system requires a “chart of accounts”, setting the framework for recording revenue, expense and the valuation of assets and liabilities. This structure is essential in properly recording accounting events and is vital to audit-proof tax reporting. A well-designed system yields valuable information about the performance of your business, enabling you to forecast, plan and react.
Again, set-up cost depends on the complexity of the business and your reporting requirements. For example, 8 hours’ work in properly setting up your system, billed at $40. per hour, costs less than a basic version of off-the-shelf accounting software, before you begin to figure out how to use it.
What About my Invoicing?
You may need to bill your customers “on-the-fly”, as events take place. We can set you up to create personalized invoices from your internet-connected device. Your customer can receive the document by email and make payment directly to your bank account. If your customers pay by credit card, we can manage that too, making your business accounting seamless and responsive. We quarterback the process so you can concentrate on generating income and profit.
Maybe I Will Just Do It Myself Using a Cloud-Based Bookkeeping System
Cloud systems have come a long way in developing an “intuitive” user-friendly interface. Even so, you’ll need a good understanding of accounting fundamentals and a willingness to climb a steep learning curve. If you’re seriously considering this approach, you should engage us to set up the system and work with you along the learning curve. Once you’re fully proficient and you have the time to run your business and be your own bookkeeper, you’ll be ready to fly solo. We’re always here if you need help or advice.
What Hardware and Software do I Need?
Most businesses already own a desktop or laptop computer, printer, internet connection and basic word processing/spreadsheet software. As smart as they are, mobile phones were not designed for business accounting. Nevertheless, your phone can be a valuable mobile tool in managing your system, whether it’s in-house or outsourced. If you operate a retail business, you will need to capture sales, provide a record of transaction to the customer and track sales tax, creating a paper trail that will satisfy an audit. We can guide you in the selection of the most cost-effective method and equipment for capturing sales and integrating with your accounting system.
We crunch the numbers; you concentrate on growing your business. Together, we make a good team.