March 21, 2022
Should You Hire a Virtual Bookkeeper for Your Business?
Fortunately, you can outsource parts of your business to freelancers, saving you time and potentially money. Specifically, many business owners hire virtual bookkeepers to maintain their day-to-day accounting responsibilities. This can be especially helpful as your business expands and routine accounting tasks accumulate.
A virtual bookkeeper can help your business stay on track, manage financial records, and reduce costly errors. However, outsourcing any function of your business often comes with risks. Due to this, it's important to weigh all the pros and cons before hiring someone for a virtual service.
In this blog post, we'll explain the most notable pros and cons of hiring a virtual bookkeeper. After reading this post, you should be able to determine if your business could benefit from filling this role.
Everything You Need to Know About Hiring a Virtual Bookkeeper:
What Is a Virtual Bookkeeper?
A virtual bookkeeper can provide routine accounting services for your business remotely. Since this professional bookkeeper will work remote, they can choose their own hours and work from any location. To hire a virtual bookkeeper, business owners often provide access to the following information:- Log-in information for their cloud based server
- Accounting software
- Financial data, such as bank statements
What Does a Virtual Bookkeeper Do?
Typically, a virtual bookkeeper performs the same functions as an in-house accountant or bookkeeper. Bookkeepers are generally responsible for processing your company’s financial transactions and recording these transactions in the general ledger. In some cases, they may leverage this information to generate periodic financial statements for your business, such as:-
- Income statements
- Balance sheets
- Cash flow statements
Pros of Virtual Bookkeeping Services:
Hiring a remote bookkeeper can benefit your small business in several ways, including:1. Cost savings
Since a virtual bookkeeper won't be a full-time employee, you aren’t required to provide them with full-time benefits. This includes paying payroll taxes, providing them with a work-space, or offering healthcare coverage. According to GrowthForce, the average virtual bookkeeper costs $500 to $2,500 per month. In comparison, a full-time bookkeeper can cost you between $3,000 and $4,500 per month, plus the cost of benefits.2. Error reduction
Even if you’re skilled at bookkeeping, you probably can't ensure that all accounting tasks are performed correctly. Since 29 percent of small businesses fail due to cash flow issues, neglecting accounting responsibilities can have major consequences. Hiring a bookkeeper to focus explicitly on routine accounting tasks can reduce errors due to multitasking.3. More freedom to do what you do best
With financial management tasks removed from your to-do list, you can focus on more important initiatives for your business.Cons of Virtual Bookkeeping Services:
Of course, there are also downsides to outsourcing your company’s bookkeeping. Some of the primary downsides to hiring a virtual bookkeeper include:1. Reduced security
When you give an outsider access to your internal systems, you run the risk that your company information will get leaked.2. Communication and logistical challenges
A freelancer may not always be available when you need immediate assistance. When working with a virtual bookkeeper, you might experience delays in communication and turnaround.3. Lack of industry knowledge
Virtual bookkeepers often serve a variety of companies and industries. Therefore, they may not have the necessary knowledge to point out potential risks to your business or make strategic recommendations.How to Hire a Virtual Bookkeeper
The good news is that finding a reliable freelancer is easier than ever. A multitude of online platforms exist to connect small businesses with quality assistance. These websites enable business owners to post bookkeeping job posts:- Upwork: Upwork is a global freelancing platform where businesses and independent professionals connect and collaborate remotely.
- FlexJobs: FlexJobs posts jobs across more than 50 categories for freelancers and full-time candidates seeking flexible work. The service carefully screens employers and candidates to ensure a quality experience.
- VirtualVocations: Virtual Vocations is a job service that connects job-seekers with hand-screened remote job leads. The site’s premium subscription model helps ensure that you’re only connected with serious candidates.