Being an entrepreneur, “What’s best for your business: Bookkeeping services or Bookkeeping employees” question might have troubled you at least once in the entire working process. QuickBooks users at least once look for the answer to this question. Understanding the need of the hour, we have come up with this article, where you will get all the answer to your questions.
Difference b/w Bookkeeping Services and Bookkeeping Employees
Bookkeeping is basically a part of the accounting process that involves recording of the financial transactions. The transaction is all about purchase, sales, receipts and payments to be made by organizations or individuals. With the advancement in technology, today bookkeeping services are offered by software. However, it is always a debatable topic that whether Bookkeeping services are better for business or bookkeeping employees.
Entrepreneurs have to ensure that proper processing and assessing is being done, and also the finances are handled in the right way and more. But all these tasks are pretty cumbersome and time consuming. And this is why businesses look for ways to handle all these tasks.
If you want to know the answer to this question, then stick to the article till the end. However, for more details, you can get in touch with our accounting help team via our toll-free number i.e. +1-844-964-2960.
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Perks of Bookkeeping Services
In order to decide from the two options, it is important to first get familiar with the perks of each of the options. Thus, following are the benefits of bookkeeping services:
Cover diverse aspects of financial management
One of the major benefits of availing bookkeeping services is that the professionals who offer these services conduct verification of data, analyse the accounts, perform audits, and accordingly caters a financial report. Not only this, but they also make the income statements, tax return records as well as maintain the balance sheets. The best part is that all the analysis that they offer give an insight of the business trends, growth opportunities as well as cash flow management strategies, which makes Bookkeeping Services beneficial for the businesses.
Reduced risk of errors and omissions
Coming to the next perk of bookkeeping services, it reduces the risk of errors and omissions. The bookkeeping service providers are known to handle the rebates, the gross amount of sale, net sale amount as well as other financial transactions. In simple words they are the ones who decide how to handle transactions and bookkeeping activities without any kind of errors, which makes it a good option for the businesses.
Cost-effective
The issue of overhead costs is one of the major concerns of majority of businesses. Apart from this, it is offering the base salary and there are many additional costs incurred by the employers on hiring employee which consists of payroll taxes, medical benefits, sick days, retirement plans, screening interviews and more. All these extra costs can be avoided by availing bookkeeping services as they aren’t very expensive as they seem to be. Thus, the entrepreneurs consider Bookkeeping services beneficial in terms of cost effectiveness.
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Perks of Bookkeeping Employees
Now that we have explored the benefits of Bookkeeping services, we will now check out the benefits of bookkeeping employees.
Daily Transaction Records
One of the most compelling benefits of having bookkeeping employee is that he/she keeps record of the day to day transactions. The Bookkeeping employee maintains purchases, payments, sales and receipts through a general ledger. They also use certain software to keep track of credits as well as debits. Moreover, they also make a trial balance which makes tracking of cash flow much easier. All this adds to the pointers to opt for Bookkeeping employees.
Easy Data generation of organization’s financial activities
Bookkeeping employees generate data of the company’s financial activities on a daily basis and in the long term this data turns into information that helps in handling the financial issues of the company. The data also assists the entrepreneurs in avoiding unnecessary expenditure and ultimately this leads to lesser chances of missing on bills or payments.
Easy Follow-up
Another benefits that adds to the list is that opting for bookkeeping employees makes it very easy for the entrepreneurs to keep a check on the performance of the bookkeeping employees and also follow-up with them. This actually induces more productivity as you can get the work done as per your requirement.
Here is a table to compare the differences between bookkeeping services and bookkeeping employees:
| Factor | Bookkeeping Services | Bookkeeping Employees |
|---|---|---|
| Definition | Outsourced services provided by professional bookkeepers. | In-house bookkeepers who are employed by a company. |
| Cost | Typically, more expensive than hiring an employee, but can save money in the long run. | Generally, less expensive than outsourcing, but can be more expensive in the long run due to benefits, taxes, and training costs. |
| Experience and Expertise | Bookkeeping services are typically provided by experienced professionals who have expertise in various accounting software and techniques. | Bookkeeping employees may have less experience and may need training to keep up with changes in accounting practices and software. |
| Flexibility | Bookkeeping services offer a high degree of flexibility, as they can be scaled up or down to meet changing business needs. | Bookkeeping employees may not be as flexible, as their workload and responsibilities are tied to the company. |
| Availability | Bookkeeping services are generally available 24/7 and can be accessed from anywhere with an internet connection. | Bookkeeping employees may have limited availability, as they may only be available during regular business hours. |
| Data Security | Bookkeeping services typically have robust data security measures in place to protect client information. | Bookkeeping employees may not have the same level of security measures, as they may not have access to the same resources as professional bookkeeping services. |
This table provides a general comparison between bookkeeping services and bookkeeping employees. The best choice for a company depends on a number of factors, including cost, experience, flexibility, availability, and data security.
Disadvantages of Bookkeeping Services
Now that we have explored a lot about the perks of both the options, it is better to get familiar with the negatives as well. The negatives of Bookkeeping Services include the following:
Inaccurate/late financial report
When the users avail bookkeeping services, at times there are chances of meaningless or incorrect accounting or bookkeeping reports. This can affect the functioning of the business and that’s why many businesses prefer in-house bookkeepers as they work with dedication.
Follow-up regularly
Even the idea of hiring bookkeeping services seem to be an easy solution, at times it becomes quite difficult as you do not get them in-person. This makes the task of tracking their work and follow-ups pretty difficult.
Disadvantages of Bookkeeping Employees
Limitations Ahead:
Even though the in-house bookkeepers may be very efficient in maintaining the finances and transactions but they often lack expertise in various other aspects. However, the bookkeeping service providers have a big team where each professionals have expertise in different niche and this makes the work a lot easier.
Distraction from Core duty:
It has been often noticed that in many businesses the bookkeeping employees are provided with additional responsibilities like human resource and this distracts them from the main work. This eventually affects the task of bookkeeping and for which organizations have to face many hassles.
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Conclusive words
As we have given a proper insight about the pros and cons of both bookkeeping services and bookkeeping employees, now making the right decision for your business falls on your part. The decision largely depends on the type and need of the business. Thus, before you jump on to any conclusion, first analyze the requirements of your business. The in-house bookkeeper is a great option for small business, but if you are a bigger organization and in a tight budget then bookkeeping service is the perfect option for you. Choose wisely so that your financial transactions are sorted.
For any doubts and queries or if you are still unable to decide which option to opt for, then connect with us and our experts will be ever ready to help you. Dial toll-free number i.e. +1-844-964-2960 to communicate with our accounting experts and Certified ProAdvisors. And we will be there to assist you in a single call.
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