Every growing business will turn up at the same crossroads at some point …
Should I hire an internal bookkeeper, or seek an outsourced bookkeeping team?
It’s a bigger decision than often thought and can depend on a multitude of factors including your size, budget and how much time you’re willing to put into your books.
Getting your bookkeeping right means accurate and up-to-date finances. Getting it wrong could mean missed deadlines and mounting costs.
This guide will help you weigh up the pros and cons of both options – so you can make a confident decision for the success of your business.
What is the actual cost of an in-house bookkeeper?
Recruiting an in-house bookkeeper seems like the most obvious choice, but the costs can add up: salary, desk and equipment, pension contributions, and your time managing them, to name a handful.
You may decide to take on the workload yourself, but trying to balance the books alongside running your business can result in potential errors, missed deadlines and penalties.
An outsourced bookkeeper resolves all these concerns. You are given one predictable cost each month with no employment overheads, and the ability to reserve all your time for one thing: running your business.
Do you get better expertise in-house or outsourced?
Employing an in-house bookkeeper means you gain someone with the right qualifications and experience, but you are relying on just one person’s knowledge.
When outsourcing your bookkeeping, you have access to an entire team who bring with them insight from a range of industry backgrounds. This allows them to stay constantly up to date with changes and continually look at your finances with a fresh perspective.
Will you still have control and visibility if you outsource?
Having a bookkeeper based in your offices or on your payroll allows for efficient communication. You have access to almost immediate answers to any queries and can set their priorities day-to-day, giving you complete control over their workload.
Although outsourcing may not allow for direct connection, a good provider will keep you in the loop with regular reporting and efficient response times. They are just a phone call away and will explain things in a way you understand.
Who manages the accounting software – you or your bookkeeper?
The future is well and truly here with cloud accounting being the new norm throughout the industry. Most companies now keep their finance records online, where they are safely secured and can be easily accessed any time.
When hiring an in-house bookkeeper, you are responsible for purchasing, updating and staying educated on the software of your choice. Staying at the forefront of innovation is becoming increasingly vital for growing businesses, as technology continues to root itself in all areas of life.
New to accounting software? Our team can help you work out which programme best suits you and your business."
When does in-house bookkeeping make more sense?
If your business manages a high volume of daily transactions, complex operations, and can justify an in-house finance team – then doing your bookkeeping in-office may be more suited for you.
As previously mentioned, an in-house employee aids a business large enough to require immediate communication and overhead control.
However, if your business is smaller and growing, you probably need more flexibility on fees, skills without the overhead and the ability to focus on running your company – outsourcing allows for all of this.
Could a hybrid approach work for your business?
There is a sneaky third choice which we haven’t mentioned yet: going hybrid.
This involves a collaboration between your in-house team and an outsourced professional. You may want to deal with day-to-day tasks at your office while handing off the rest to us.
Still not sure? Questions to ask yourself:
- How many transactions do we handle each month?
- Would one predictable monthly cost suit my cash flow better than employing someone?
- Do I have the time and confidence to do the books myself, or to oversee someone else doing them?
- Am I confident we’re keeping up with changing VAT and tax rules?
- Am I prepared to buy, maintain and stay expert in accounting software?
- Do I just need the books kept, or do I also want insight to help me make decisions?
Your method of bookkeeping should fit you and your business
A larger operation with higher transaction volumes would justify an in-house bookkeeper on payroll. A growing business often finds more value in outsourcing – expert support, flexibility and predictable costs. Or maybe your need something in-between?
