It is almost universally known that low-cost and quality generally don’t come in the same package. The bookkeeping world is definitely no exception.
Our owner has worked with several freelance bookkeepers firsthand because the majority of them don’t also prepare taxes so whoever hired them seeks out a tax professional when it comes time to file the tax returns. The person who hired them often thinks they are great because they only have to pay them $10 to $15 per hour, but when a qualified professional reviews their work it almost always tells a much different story. Not to bad-mouth the whole bookkeeping profession because there are some great professionals out there who solely specialize in bookkeeping, but high-caliber inexpensive bookkeepers are very rare. Most of them really just know how to do data entry, but have a very limited if any background in accounting.
At the end of the day, they have put your transactions into QuickBooks or whichever accounting software you use, but provide little other benefit to your business. The bank and credit card reconciliations are usually incorrect (if even completed), liabilities aren’t recorded and tracked properly, and transactions are often placed in the wrong accounts. These issues make it near impossible to track and potentially alter if need be key financial areas of your business throughout the year. They also create major headaches for whoever is preparing the tax returns due to extensive clean-up work having to be done in order to obtain proper tax reporting. This also almost always greatly increases the tax preparation bill, which is another significant issue to consider.
If your business is in need of bookkeeping services, but the amount of work doesn’t warrant an employee, spend a little more and hire someone qualified. They can provide financial analysis when requested, transactions will be recorded properly, your accounts will be in balance, the financial state of your business can be properly monitored year-round, and it is almost guaranteed your business tax preparation bill each year will be much lower.
Thank you as always to those who took the time to read this latest blog post, and we hope everyone has a productive week!