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If you find yourself overwhelmed by the number of overdue books that you need to catch up on, a good option for you is to consider hiring virtual bookkeeping services. Maybe you own a small business, or you’re a startup founder and you’re wondering if outsourcing your bookkeeping is the right move for your budding business.
Well, first, bookkeeping is essential for any business. Second, virtual bookkeeping is especially beneficial for small businesses for a lot of reasons. One of the top advantages is getting bookkeeping off your plate so you can focus on other core areas in the business.
Another advantage is that when you hire from an online bookkeeping company, it means you have an experienced on your team who knows exactly what to do with your financial records. To help you get the most out of hiring virtual bookkeeping services, this article discusses:
- What is virtual bookkeeping
- How virtual bookkeeping works
- What do virtual bookkeeping services include
- Benefits of virtual bookkeeping for your business
- How much do bookkeeping services costs
- Tips to hiring the right virtual bookkeeping services for your needs
1. What is virtual bookkeeping?
Also known as cloud accounting or online bookkeeping, virtual bookkeeping is when a bookkeeper or an accountant provides their services to their customers remotely.
A virtual bookkeeping company, for example, can offer its services to clients wherever they are in the U.S.
Through the internet and the advancement of cloud-based accounting software, you can share an account with your bookkeeper and they can upload your financial transactions, update your statements, reconcile your accounts, and perform other bookkeeping tasks.
2. How do virtual bookkeeping services work?
When you engage with virtual bookkeeping services, the first thing that your online bookkeeper should do is ask questions about you and your business so that they could fully understand your needs. They will inquire details about your company, such as how long you’ve been in business, what is your business structure, how are you currently handling books, etc.
Once your bookkeeper has a full understanding of what your needs are, the next step is setting up tools and apps where they can communicate with you and handle your books. For you to work seamlessly, you must use the same workflow tools and share access to these platforms with your virtual bookkeeper. If you don’t have an existing accounting software yet, your bookkeeper can suggest one of their preferred cloud-based apps, such as Quickbooks or Xero.
Here at miplly, we set up our clients on their own personal dashboard, where they have online access to their financials and where their assigned bookkeeper can download, categorize, and reconcile transactions.
If our clients already use an accounting tool, we help them transfer everything to their miplly dashboard so that all their records and bank accounts are streamlined and accessible in a single platform. After you have an account set up, you would need to provide your bookkeeper from time-to-time receipts and other important transaction records.
In traditional bookkeeping, you need to mail or personally hand in these documents to your bookkeeper. While in virtual bookkeeping, you only need to take a photo of a receipt and then upload them to the accounting software.
At this point, your online bookkeeper has everything they need to start working on your books.
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3. What tasks can a virtual bookkeeper handle?
The main job of an online bookkeeper is to record and summarize all financial transactions as timely and as accurately as possible.
They may not be physically present in the office to accomplish their work, but there are plenty of other services that they could offer to their clients. Other common tasks that you can expect from a virtual bookkeeper are:
- Provide you with monthly financial reports (income statement, balance sheet, cash flow statement)
- Monitor your cash flow
- Notify you of any financial issues
- Assist you with budgeting and analysis
- Account reconciliation
- Full-financial overview of your company’s financial health
- Payroll processing
- Invoicing and invoice follow-up
- Take care of your taxes returns/ tax filing
4. How can businesses benefit from virtual bookkeeping services?
Hiring virtual bookkeeping services can help a business in a lot of ways. Besides the advantages mentioned earlier, other benefits of outsourcing your bookkeeping are:
- Get up-to-date financial information – For a business to remain afloat, owners need to keep a close eye on what their numbers are telling them. However, this is impossible if you have outdated or inaccurate financial data. A bookkeeper can help you reconcile your bank accounts in a timely manner, so you can easily identify potential issues and prevent costly financial errors.
- Identify where you’re spending your money – A professional bookkeeper can help you track your expenses and categorize them properly. This way, you will have a better understanding of where you are spending your money so you can budget and adjust accordingly.
- File and pay the right taxes – Improper bookkeeping could get you on the wrong side of the IRS, and as a business, this means hefty fines. With a virtual bookkeeper on your team, you have someone accurately preparing your taxes and filing them on time. In addition, a bookkeeper has the proper knowledge of the tax treatment of each expense, so you also don’t miss out on tax deductions.
- Get help with payroll – As your team grows, processing payroll could be a tedious job for you to handle. A bookkeeper can carry out this task for you so you have more time to focus on other aspects of the business.
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5. How much does it cost to hire virtual bookkeeping services?
The cost of virtual bookkeeping services varies widely depending on the size of your business, the tasks that you will outsource and the amount of work that the online bookkeeper will need to undertake. For a one-time project, for example, when you need help to catch up with your books, the cost is around $50-$300, depending on how long you’ve fallen behind. If you need assistance updating your books daily, hiring a virtual bookkeeper on an hourly basis could be more beneficial. A virtual bookkeeper could charge anywhere between $25 to $50 per hour. If you require bookkeeping services on a monthly basis, the rates range from $75 to $500, again depending on your needs. At miplly, our starter plan is $175 per month, where you will be assigned your personal bookkeeper who will take care of your daily balances, account reconciliation, monthly reports and will also provide you with the financial overview of your business. For more details about our rates, you can check out our pricing here.
6. What are the things to remember when looking for virtual bookkeeping services?
Here are a few things to consider when hiring virtual bookkeeping services for your company:
- Availability – Since you’re hiring remote services, this could mean that your bookkeeper may not share the same time zone as you. Make sure to ask whether the bookkeeper is available during your operating hours or if they’re flexible to adjust their time to meet yours.
- Industry familiarity – Especially if you’re in construction, your business will require a special kind of bookkeeping that is unique to your industry. Try to look for bookkeeping services that specialize in your type of business.
- Communication – Clear communication is key to an efficient working relationship with your bookkeeper. Are you comfortable with emails or do you prefer discussing matters through video conferencing? Make sure to inform your virtual bookkeeper what type of communication style works for you.
- Access to your accounts – Transferring your books to the cloud means having 24/7 access to your records, whenever and wherever you are. Your virtual bookkeeper should help you set up an account on accounting software, like your miplly dashboard, so you can have all the information that you need on one platform.
- Pricing – The lowest price doesn’t mean it’s the best choice and the highest price doesn’t always assure the best services. When looking for virtual bookkeeping services, see if which firm will give you the best value for your money. Some bookkeeping companies charge by the hour, per project, or on a monthly basis. There are also some firms that offer custom plans depending on your bookkeeping requirements.
- Proven track record – One of the most important considerations when choosing an online bookkeeping company to work with is its reputation. You want to work with a firm that is trustworthy and dependable since you will be providing them access to sensitive information. A way to confirm this is by checking online reviews, finding out how long the company has been in business and whether they have an established online presence.
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Does virtual bookkeeping make sense for your business?
If keeping your records straight is taking much of your time and patience, the sensible solution is to start outsourcing your bookkeeping. At miplly, we have a team of experienced bookkeepers who specializes in several areas such as, small business bookkeeping, construction bookkeeping, and startup bookkeeping, to name a few.
Let us take care of your books so you can focus on what matters most for your business. Start your free trial today.