When you’re a business owner, it’s inevitable that you’ll spend more time than you ever thought possible crunching numbers. One of the things we hear all the time at Symmetrical Solutions is: “Do I need a bookkeeper when I already have an accountant?” While both bookkeepers and accountants are essential to handling the financial aspects of a small business, they each provide a unique set of skills that are best suited to particular problems.
Things Bookkeepers Do
Bookkeepers are responsible for keeping track of and organizing the day-to-day finances for a business. Some of their tasks include:
- Processing and recording financial transactions
- Generating reports
- Calculating asset depreciation
- Budgeting
- Payroll
- Maintaining general ledgers and monitoring cash flow
- Ensuring IRS compliance – tracking info and receipts for tax purposes
When you first start your business, you may handle your own bookkeeping. However, as your business grows, you may be pulled in different directions and may require assistance in managing your cash flow – that’s a bookkeeper’s specialty.
Bookkeepers use software like Quickbooks to double check and record all your financial transactions. They ensure your suppliers and employees get paid and your customers get billed, and that there aren’t any errors in your finances.
What Accountants Do
Accountants are licensed professionals best suited for deeper business analytics; they’ll take the information that your bookkeeper has compiled and interpret it to help you make sound financial decisions for your business. They might offer advice on tax credits, or provide insights on structuring your business or predicting cash flow. You’ll also want to keep an accountant’s number handy at tax time as they’ll assist you with taking advantage of as many tax savings as possible.
In addition to tax season, you’ll want to consider hiring an accountant when you:
- Start or restructure your business
- Take on a partner or an investor
- Encounter tax penalties or an audit
- Other consulting requiring a look at “the big picture” of your business
Do You Need a Bookkeeper?
It depends. If your business sells products online or in person, you need to keep track of not only your sales, but also inventory and sales tax. There’s a lot of details, and having a bookkeeper’s assistance can save you time and ensure standard operating procedures. By comparison, if you’re a software developer that invoices one client a month, you may not need a professional’s assistance. No matter your type of work, if your business is growing and you want to spend more time focusing outside the numbers, outsourcing your day-to-day financial tasks to a bookkeeper is a no-brainer.
Both bookkeeping and accounting have a place in your small business owner bag of tricks, and these two roles complement each other much more than they compete. While you’ll be called upon to do some of both of their individual functions when you start your business, identifying your financial needs as your business grows is critical to running an organization that’s sustainable.
Seeking out support from both an accountant and a bookkeeper like Symmetrical Solutions is a key way to ensure your business is as healthy financially as it should be! We’re passionate about helping our clients by completing needed monthly tasks, while keeping a watchful eye on their financials to ensure their business is financially healthy.