Resolution #5: Don't Go it Alone

2021 is already off to an awesome start! We have a bank account, we are using accounting software, we are looking at reports, and we have created a routine. Now is the time to take things to the Next Level!

Resolution #5: Don't go it alone!

(Ok, I know! You may be thinking that we should have started with this one, just outsource it all, but stick with me)

Bookkeeping and accounting are skilled professions. It is a skill that people develop over the years, refine with time, and learn from doing and seeing. While no one knows your business as well as you do, no one knows how to help your bookkeeping be its best, better than a bookkeeper.

Bookkeepers can step into your business in a variety of ways to assist with the smooth function of your accounting processes:

• Review Bookkeeping: In this scenario, your bookkeeper acts in the function of a "reviewer" of your books. They reconcile your accounts on a monthly basis and review and prep financial reports. Meanwhile, you or someone in your office is handling the day to functions, such as invoicing clients, logging expenses, and paying bills.

• Full Bookkeeping - in this scenario, your bookkeeper is handling everything. They invoice your clients, they handle your bills, they reconcile the accounts, and they review and prep financial reports.

• Hybrid Bookkeeping: In this scenario, the bookkeeper acts a little bit in both worlds. They reconcile the books and invoice clients, but perhaps you are making sure bills get paid.

Ready to hire? Here are some tips:

• Hire someone with the right skills: When hiring a bookkeeper, many small business owners make the mistake of thinking that this person must be an accountant or a CPA. While you may find an accountant who is skilled with bookkeeping, these two skill sets are not mutually exclusive. You don't need someone who knows every tax law and deduction. Instead, you want someone who is skilled at your accounting software and has the skill set needed to maintain your books from an accounting perspective.

• Ask for referrals: Ask other business owners who they use or recommend. The best referral source: your CPA. Your CPA may offer some bookkeeping services; even so, they probably also have a list of qualified candidates that they can recommend. You know that their recommendation is a good one, as they have a vested interest in your books being handled correctly.

• Understand Price: Bookkeepers typically work in one or two models: an hourly rate or a monthly flat rate. Expect to pay at least $50.00 an hour, higher if you have more complexities such as payroll. Many firms will also require a monthly minimum of $100 to $150/month.

So, for resolution #5, don't go it alone: seek out professional support... so why did we make the other four resolutions first?

Because bookkeepers are fantastic, but they are not magicians. At best, they are chefs trying to recreate your favorite recipe. The work they do is only as good as the "ingredients" you give them. Not co-mingling funds, using accounting software, reviewing reports, and having an impeccable routine will all ensure that your bookkeeper can execute the recipe perfectly!