Is Virtual Bookkeeping For You?

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The number of tasks that can be done online nowadays is huge. You can order your dinner, pay your bills, and check your account balances all while sitting in your home comfortably. So, why not check out virtual bookkeeping.

If you decide to hire a virtual bookkeeper to handle your accounting services, you can rest assured that your finances are in great hands. Letting the experts take over the tedious duties of tracking and organizing your finances frees you up to focus on your business in other ways.

Virtual Bookkeeping (also called remote bookkeeping), like most things, has its possible shortcomings along with its many advantages. This article will go into more detail about what virtual bookkeeping can and cannot do, which will hopefully help you decide if it would be beneficial for your company.

Virtual Bookkeeping

A virtual, or remote, bookkeeper is exactly what it sounds like, a bookkeeper who does your bookkeeping tasks remotely. This means they could be in a different city, state, or even a different country than where you reside. Just like a bookkeeper that you would meet in person, or that would work in your building, a virtual bookkeeper would be able to organize your financial transactions and prepare the financial statements for your company.

While virtual bookkeepers work with several clients at once, they are always able to make time to address your questions and discuss any of your business’s financial matters. These professionals will give your business the same care and attention as a full-time, in-house bookkeeper, but on a part-time budget.

Is bookkeeping really that important?

Every business can benefit from proper bookkeeping, from very small start-up businesses to larger corporations. To be successful in your business, you need to be able to make informed decisions, and without updated financials that becomes extremely difficult. Good bookkeeping also helps tremendously at tax time and with identifying possible tax deductions. Part of the bookkeeping process includes preparing financial statements, including the income and balance sheets, which provide you with important information like your cash flow and what the health of your business looks like.

Bookkeeping gives your business the opportunity to maximize profitability, minimize expenses, and make wise business investments.

Doing your own bookkeeping vs. hiring a professional

While it is absolutely possible to do your own bookkeeping, you may decide down the road that it is taking up too much of your time and frankly just boring. Some signs that you may want to outsource your bookkeeping are:

  • You do not have the time or energy to stay on top of your books.
  • Your books are consistently behind, and it feels like you are always trying to catch up.
  • Tax season is a giant headache and too stressful
  • You have been paying an accountant to do your bookkeeping, which is much more expensive.
  • You find yourself unsure of your cash flow and your profitability.

Virtual bookkeepers can work with both digital and cash transactions, however digital transactions will be taken care of quicker. Digital transactions include things like credit card, debit, and PayPal transactions.

Go virtual or stay local?

Honestly, nowadays the overall difference between local bookkeepers and virtual bookkeepers is small. While you may be more comfortable hiring an in-person bookkeeper, you might be surprised how little you would actually need to interact with them. Instead of physically handing over your financial data every month, most everything is done online.
Local bookkeepers, most of the time, even use the same software as virtual bookkeepers. Either way, you give access to your financial accounts and the bookkeeper will record and organize the transactions, then produce the financial statements.
Although local and virtual bookkeepers work similarly, there are some key differences to take into consideration.

  • Physical Papers – If your business has a lot of paper records, such as receipts, invoices, etc., these can be easily hand delivered to a local bookkeeper. If you had a virtual bookkeeper, you would have to take the time to scan all of those documents to create a digital copy to send to them.
  • Software Choices – Local bookkeepers tend to use mass-produced accounting software, which you will also need to purchase and become familiar with. Virtual bookkeepers can use either the off-the-shelf software or, like Remote Books  online, provide a customized user-friendly platform.
  • Mobile Access – Services like Remote Books Online have a mobile app, so you can access your financial reports more readily. Local bookkeepers are less likely to be able to provide this feature, depending on the software they use.
  • Experience with Online Businesses – A local bookkeeper may or may not be familiar with industries such as ecommerce or online services such as PayPal. Virtual bookkeepers, on the other hand, tend to have knowledge and experience with online business, as they are online as well.
  • Tax Season – A local bookkeeper will not file your taxes; they will hand off the financial records to a CPA. While online freelancers also tend to hand off your data to an accountant, services like Remote Books Online can either work with your CPA, or file your taxes themselves.
  • Payment – Local bookkeepers tend to charge hourly and have a minimum monthly rate, the same goes for online freelance bookkeepers. Remote Books Online, however, charges a flat monthly rate.
  • Cost – Local bookkeepers tend to be more expensive than virtual bookkeepers.

Freelancers versus Services

The two types of virtual bookkeeping options are freelancers and services.

Freelancers

Freelancers are independent bookkeepers hired through online websites, such as Upwork. When hiring a freelancer, keep in mind that the level of education and experience can vary, since bookkeepers are not legally required to have special licenses or certifications.

Freelancers widely use off-the-shelf accounting software, which you will also need to purchase and become familiar with. You will most likely communicate through email or messaging apps.

Services

Virtual bookkeeping services, unlike freelancers, normally present you with a team of bookkeepers to work on your bookkeeping needs. Remote Books Online is a service that offers this.

Services tend to be more flexible than individual freelancers. Since they work in teams, you never have to be concerned with your bookkeeper getting sick or going on vacation, leaving you in a tricky situation. They also usually have an app you can use and have access to whenever you need.

Services usually have the ability to connect directly to your accounts, such as bank and credit card accounts, to automatically have access to your transactions. Remote Books Online can do this to ensure your records are quickly recorded and categorized and ready to use to create financial statements. Remote Books Online has a user-friendly platform that offers easy to understand reports and dashboards to track your finances. It is also used to communicate with your bookkeepers and allows you to upload any necessary documents for your books.

Remote Books Online offers services such as catching you up, if you have fallen behind on bookkeeping tasks, and filing your taxes at tax time.

Which Virtual Bookkeeper option is right for you?

It is up to you on whether a freelancer or a service would better fit your business’s needs. In order to make the best decision, there are a few things you should keep in mind.

  • The number of transactions your business encounters in an average month. As discussed, freelancers usually charge by the hour, so a greater number of transactions requires more time to complete your bookkeeping. A service, however, tends to charge a flat monthly fee.
  • Whether you use cash or accrual basis accounting. Virtual bookkeepers may work with one method, or the other, or both. You should make sure whoever you choose works with your chosen method.
  • If you already utilize a CPA for your tax needs. If you already have a CPA, confirm your virtual bookkeeper is able to collaborate with them, or has the ability to find an accountant for you.
  • The availability you are looking for in a bookkeeper. With a bookkeeping service, you are most likely working with a team of bookkeepers, so someone is readily available when you need them. A freelancer, on the other hand, will most likely be one person juggling multiple clients, so during tax season, they may be swamped. Also, if they go on vacation or celebrate certain holidays, their availability would be limited.
  • Your bookkeeping budget. It is always wise to know beforehand how much you are willing to pay for bookkeeping services. That way you can avoid wasting time looking at options that will not fit into your budget.

Virtual Bookkeeper Candidates

When you are looking for possible virtual bookkeepers, there are a few things to look out for.

Online Presence: If you are researching a potential virtual bookkeeper and you are finding that their online presence is lacking, they probably would not be the best choice for the job. A virtual bookkeeper should have a website and online profile, they work virtually, so an online presence is important.

Online Reviews: Most virtual bookkeepers will have reviews/testimonies listed on their website or social media. If you are having trouble finding any, you can always ask the potential bookkeeper if they can provide some.

Relevant Experience: It is a good idea for any potential virtual bookkeepers to have experience in your specific industry. They will be more knowledgeable when it comes to tax time and deductions and have an easier time categorizing all of your financial data.

Software Selection: If you are already comfortable with a specific software for your bookkeeping needs, finding a virtual bookkeeper that can use that software will allow for an easy transition into your bookkeeping relationship.

Remote Books Online

Remote Books Online is a virtual bookkeeping service that provides a team of professional bookkeepers to assist you with your bookkeeping needs. They are able to automatically import your financial transactions, organize and categorize them, and create monthly and end-of-year financial reports.

Remote Books Online offers an innovative platform that is designed specifically for ease of use by business owners. Using the website or app, you can look through all of your transactions, check on your cash flow, and view your financial reports on your browser or phone.

The team of bookkeepers will work seamlessly with your accountant and be sure everything is prepared and ready come tax season, and all possible deductions are applied. As an added benefit, if you do not use an accountant, Remote Books Online has the capability of completing your taxes for you, if you choose to opt in that feature.

Who uses Remote Books Online services?

Remote Books Online works with all businesses in the United States who want their bookkeeping completed virtually.

If you are looking for a bookkeeping service, check out Remote Books Online and see if they would be a good fit for your needs.

The cost of using an online bookkeeper

If you are thinking about hiring a virtual bookkeeper, but are still unsure if it is a good idea, especially when it comes to the cost, there are a few things you may want to consider.

Let’s assume you typically spend about eight hours per month completing your bookkeeping duties. Look at the monthly price of an online bookkeeping service or the hourly rate of a freelance bookkeeper. What ends up being more valuable? Your time, or completing the bookkeeping tasks yourself?

If you are spending too much of your valuable time on the bookkeeping tasks, it may be time to look into outsourcing. Consider the other tasks you could be completing, or the much-needed rest you might be needing. Those things have value, and should be considered in your decision.

Hiring a virtual bookkeeper can save you time, money, and maybe even some sanity, because, let’s face it, bookkeeping will always have a price, it’s up to you whether its money or something else.

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