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The true cost of doing your own bookkeeping

The appeal of doing your own bookkeeping is perhaps obvious: not having to pay someone else to do it for you. But the important thing to consider when you are thinking about doing your own bookkeeping or outsourcing it is what you are losing from taking that time from your business.

The appeal of doing your own bookkeeping is perhaps obvious: not having to pay someone else to do it for you. But, one important thing to consider when deciding whether to do it yourself is the amount of time it will take away from other tasks that are critical to running your business.  Bookkeeping can be a time-consuming process. It is constantly ongoing - and sufficient time is needed to track and record all of your transactions and financial information. It’s important to think about whether the time spent bookkeeping could be better used for growing and gaining traction in competitive markets, marketing, or product development, all of which require precious time.

What might you lose when bringing your bookkeeping in-house?

While you likely aren’t losing money directly from your bank account when you decide to do your own bookkeeping, you are losing time. If your business is one that you started and have built up yourself, it’s also likely that you are not an expert in accounting or record keeping. This means that you will either need to expend time and resources learning accounting skills (keep in mind that most accountants have a college degree), or you could risk making costly bookkeeping mistakes.

There are many problems and headaches that you can potentially run into while managing your own bookkeeping. Some of the biggest of these include:

●      Miscalculations and simple errors

●      Staying on top of paperwork and filing

●      Preparing for taxes and completing the correct forms and documents

●      Managing payroll for yourself and employees

●      Staying up to date on new rules, regulations, and policies

●      Being aware of and remembering important filing dates

Reach out to professionals?

Whether you have already gone through these headaches, or you’re looking to put them in the past, you probably have come to the conclusion that it is a good idea to find a different solution to bookkeeping rather than adding it onto the long list of tasks you have as a business owner. There are two main options for handing off your bookkeeping:

1.     hiring a bookkeeper as an employee (“in-house”); or

2.     outsourcing it to a company or individuals.

Hiring an in-house bookkeeper as a full-time employee can be a very expensive process. For a small business, this may be largely out of budget and cost more than you had planned for.

Alternatively, outsourcing bookkeeping is generally an affordable option for bookkeeping and a reliable one at that. Using bookkeepers’ professional services for your business allows you to access years’ worth of experience and learning to care for some of the most vital parts of your business. The services can vary but you can expect all your transactions to be tracked correctly and a regular reconciliation of your books.

KPMG Spark - Online Accounting Solution

While there are many options available for outsourcing your bookkeeping, KPMG Spark has developed a one of a kind solution that includes our online software. This allows you to connect your accounts, while we reconcile your books, securely and quietly in the background. This allows for simple payroll management, the tracking of all your expenses, and even tax document preparation. Not to mention, when you sign up for KPMG Spark, you get a dedicated bookkeeper and manager, and CPA who are on your team and are available to talk to you when you need to. We do all this so you can focus on what really matters: the day-to-day of your business. Doing your own bookkeeping can be a large time commitment, so let us take it off your hands. Visit our website today to see how we can help you get back to your business!

 

 The views and opinions expressed herein are those of the author and do not necessarily represent the views and opinions of KPMG LLP.

This blog article is not intended to address or provide advice concerning the specific circumstances of any particular individual or entity and does not constitute an endorsement of any entity or its products or services.

Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities.

The following information is not intended to be “written advice concerning one or more Federal tax matters” subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230. The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.

Ben AsplundNovember 3, 2020Posted In: Business Tips

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