The False Economy of doing your own Bookkeeping
“It’s okay. I do my own books”
When talking to local businesses we hear this statement a lot.
It’s natural to want to control your expenditure but is doing your own books the best way decision
Here are four factors to bear in mind when making that decision.
- Efficient use of time
Do you enjoy paperwork? Is it the reason that you started up in business? Sometimes it can feel like you’re drowning in paper. It can get in the way of you operationally, which in turn effects how quickly you get paid. It can stop you marketing yourself, creating opportunities to sell which in turn inhibits growth of the business.
Value your time. The time you spend on your books isn’t free. It has an opportunity cost. The cost of outsourcing a qualified bookkeeper usually works out cheaper in the long run when compared to the value that you could be adding to your business by using your freed-up time other things.
- Cash is King
Cash is the oil in the engine of your business. If you are struggling to find the time to raise invoices it is unlikely that you will find the time to do the necessary analysis to see how and if you can optimise cashflow. Good management accounts quickly identify these issues so that you can take the necessary actions
- Impressing the outside world
The health of your business is based on your numbers. Knowing your numbers will also help you plan effectively; it’s easier to know where you are going if you know where you are. An accurate picture of your finances will be particularly useful if you need to raise extra finance. When it comes to keeping the taxman happy a modest investment in quality bookkeeping should not only save you a lot of aggravation but might also spare you financial penalties.
- A shoulder to lean on
If you are worried about any aspect of your business, who are you going to call? It can be lonely running a business.
A bookkeeper will be able to pass on the benefit of his experience to you as well as being able to introduce you to other clients and contacts who might be of benefit to you.