Bookkeeping is quite important if you want your organization to succeed in the long term. This process roughly involves keeping track of how money is flowing in and out of the organization. It also involves vigilance to cover against erroneous activities.
Unfortunately, tough business competition has left many organization’s accounting departments ill-equipped. As organizational resources flow into marketing and research, the ability to build a complete inhouse team becomes lesser and lesser. However, outsourced accounting services in Miami have emerged as a worthy alternative. Instead of hiring and building an in-house team, the organization can simply outsource these responsibilities to a pre-existing team of professional accountants.
The best part – outsourcing bookkeeping responsibilities has been even better than in-house bookkeeping for many organizations. This takes care of all major aspects of bookkeeping and accounting, thus allowing a business to focus on what they do best.
Here’s what outsourced bookkeeping involves…
Accounts Payable: Entry and Bill Paying
Managing accounts payable can be time-consuming, requiring businesses to track, record, and pay all bills on time. When this is done in-house, it often demands dedicated staff or resources, which can drive up operational costs. Outsourcing accounts payable offers a streamlined and efficient solution, as expert bookkeepers handle the entry and payment processes accurately and on time.
Accounts Receivable: Entry, Invoicing, Deposits, and Collections
Accounts receivable is another critical area where outsourcing proves just as effective as in-house bookkeeping. It involves the entry of revenue, invoicing customers, depositing payments, and even managing collections when necessary. An outsourced bookkeeping service ensures that all invoices are sent on time and all payments are properly recorded, preventing any discrepancies.
Bank Reconciliations
Bank reconciliations are essential for maintaining accurate financial records. This process compares your company’s financial statements with your bank statements to ensure there are no discrepancies. Failing to reconcile accounts regularly can lead to errors that affect the overall financial health of your business.
Inventory Management
For businesses that manage inventory, bookkeeping also includes tracking stock levels, cost of goods sold (COGS), and reconciling discrepancies between physical inventory and recorded numbers. Managing this internally can be labor-intensive, and any errors can significantly affect profitability.
Bookkeeping Cleanup
Sometimes, businesses may fall behind on their bookkeeping, leading to disorganized or incomplete financial records. In such cases, outsourced bookkeepers offer a “bookkeeping cleanup” service to bring everything up to date. This service includes organizing financial records, identifying and correcting errors, and preparing reports for tax season or financial audits.
General Ledger Maintenance
The general ledger is the core of any business’s financial system, recording every transaction that occurs. Maintaining a clean and accurate general ledger is crucial for generating financial reports and filing taxes. Errors in the general ledger can lead to incorrect financial statements, which can have far-reaching implications.
Tax Forms (1099s, 1096)
Tax compliance is one of the most significant areas where outsourced bookkeeping services offer value. Businesses are required to file specific forms, such as 1099s and 1096s, to report various payments to independent contractors and the IRS. Filing these forms incorrectly can lead to penalties and additional scrutiny from tax authorities.
Payroll Processing
Managing payroll is a critical function of any business but can be overwhelming if handled internally, especially as your company grows. Payroll involves calculating wages, withholding taxes, and ensuring compliance with both federal and state regulations. Errors in payroll can lead to costly penalties and employee dissatisfaction.
Outsourcing bookkeeping can be the competitive advantage your organization needs to succeed. Knowing that you have a reliable team of experts focusing on financial management, you can devote valuable resources and energy to other pressing concerns. In today’s world, a growing business that outsources accounting is one that can win.