Accounting Services: What to Expect?
Accounting is an important part of any business. It is important because from it a business owner can gather information about how the business is doing. A small business owner is not exempt from keeping financial records for the business. She can do it herself. She can hire a full-time bookkeeper. Or, in common practice, she can be outsourced to an accounting firm that offers bookkeeping services.
Bank reconciliation is one of the accounting services that an outsourced bookkeeper can perform in a small business. It is a document that explains the difference between the cash balance according to the bank’s monthly statement and the company’s cash balance according to its books on a given date, usually the statement’s ending date. This is an important activity to check for posting errors in bank and company records.
Trial balances are also one of the accounting services to be performed by the bookkeeper. A trial balance is an accounting spreadsheet used to verify the mathematical correctness of account balances. This document can help the employer in making decisions.
One of the bookkeeping services to be provided by the bookkeeper is the preparation of financial statements. These financial statements are used solely for internal decision-making purposes. The business owner can know the financial situation of his business and its financial performance, which can be beneficial in making economic business decisions. These financial statements are also useful to other stakeholders of the company such as its employees, its creditors, its suppliers, the government, and even the general public. If these financial reports are going to be shared outside the company, then a CPA must issue a report on them. For this reason, it would be advisable to have a licensed CPA firm handle your accounting.
General ledger maintenance is also one of the accounting services that the bookkeeper must perform for the business owner. A general ledger is the heart of a company’s accounting records. All raw data is recorded, classified and summarized in the general ledger and used as a basis in the preparation of the trial balance and financial statements.
The maintenance of accounts receivable and accounts payable should also be one of the accounting services. Accounts Receivable is a list of all the unpaid transactions from the company’s customers, while Accounts Payable is a list of all the unpaid transactions that the company owes to different vendors. It is important that both accounts are up to date because it is cash.
Payroll processing is also one of the accounting services that a bookkeeper offers to his client. Payroll services must also include the correct tax deductions and payment to other agencies. Bonus computations and other deductions are also part of this service.
When hiring an outsourced bookkeeper, a small business owner can consider the following tips: decide what bookkeeping services the business needs; find a bookkeeper near the business location; and have a screening list of all potential bookkeepers that are close to the business location. One should have a list of the services they offer and the fees of each bookkeeper. A business owner must make a careful evaluation before choosing a bookkeeper because the future of the business is at stake.