FAQs

If you want to grow your business, save more time and get more done, you need a bookkeeper. A survey conducted by Outright.com revealed that small business owners generally spend 5 hours every month on bookkeeping, while a professional can do the same job 63% faster and with fewer errors. As a business owner, time is money, and efficiency is key.

As an entrepreneur, would you rather spend your time worrying about bookkeeping, or building your business? The answer should be obvious, but while you’re probably aware of the more apparent benefits of taking bookkeeping off your plate, you probably haven’t thought of these.

Experience peace of mind: While it is critical component of every successful business, bookkeeping likely isn’t at the top of your priority list. Imagine how great it would be if you could spend less time worrying about financial details, and more time doing what you do best? You really can’t put a price tag on peace of mind and the satisfaction of knowing that your bookkeeping is done accurately and on time by a professional.

Reclaim your weekends: If you’re sick of working eight days a week, you may want to consider outsourcing your bookkeeping. You deserve to spend your weekends recharging for the days ahead, not burning out as you try to keep up with every aspect of your company’s operations.

Enjoy your beauty sleep: There’s nothing worse than waking up in the middle of the night in a complete panic with the feeling that you forgot something important on your to-do list. Pass some of the responsibility over to a trained bookkeeping professional and watch the bags under your eyes disappear.

Improve your relationships: It’s not uncommon for business owners to be pulled in many directions. Work-life balance can be difficult to achieve if you’re busy hustling all the time, and your relationships will suffer. Outsourcing your bookkeeping can mean freeing up your mind and being present with the ones you care about most.

A good bookkeeper is a valuable asset to your business. When you have so many details to look after, keeping finances in order can be a burden that’s too overwhelming to handle on your own. Yet, financial organization and tracking are essential for monitoring the health of your business. You’re also legally required to manage finances responsibly for tax purposes.

Experience: Obviously, it’s a good idea to pick a bookkeeper with relevant experience. Ask about the bookkeeper’s experience in your industry and what types of clients they’ve had in the past. If they’re familiar with businesses of a similar size and industry to yours, that means they’ve probably already seen issues your business may face in the future.

Technology compatibility: if you’re already working with accounting software, make sure that your potential bookkeeper is comfortable with it. You can ask for certifications or ask what experience they have with the software. Don’t forget to ask what version they use and how they stay up to date.

Relationship: This will be more of a gut decision. Do you feel comfortable with them? Do you feel like it will be easy to understand each other? You need a bookkeeper who can turn accounting speak into regular language and who is communicative.

How do they work: A good bookkeeper has some basic procedures and services they offer to help you make sure everything is in order. A red flag should go up if the potential bookkeeper waits for you to give instructions.

Bookkeeping can seem like a foreign language for some business owners. While you may be great at offering the service or product your business provides, you may not be the world’s greatest financial expert. But some basic bookkeeping knowledge is certainly helpful for running a successful business, big or small.

Save for big expenses: If you look down the road in a few years, will you need to buy new equipment? Whatever it is that you need for your business, you need to keep these expenses in mind so that you can start saving for them now. It can be difficult to come up with a few thousand or even a few hundred dollars with only a few months’ notice. Stay on top of this with a general fund to invest in your business, or rather, keep it aside for specific projects.

Know your income and expenses: Use a system to track deposits to your business account and also expenses. Do this regularly. You may not remember the exact source of each income deposit after a few months, but this is essential for sorting your taxes later on. You also need to know what your expenses are and what each one went towards so that you can claim them correctly later.

Track invoices: Make a system for dealing with invoices and reviewing which ones have been paid and which are overdue. Then, put a plan in place for dealing with overdue payments so that you can collect this missing income.

Most entrepreneurs start a new business because they have high aspirations of running with their idea and experiencing huge success. Despite no one thinking their business will flop, the reality is more than 50% of businesses fail within the first year. While crunching numbers and balancing the books may not be a top priority for most, failing to plan out strong accounting and bookkeeping practices can be a huge red flag.

Cash flow: Want to know the quickest way to go out of business? Try running out of money. A bookkeeper can help you take the guesswork out of cash flow by providing up-to-date financial information that shows you exactly what’s outstanding, and what’s upcoming.

Accounting records: If you don’t have a paper trail of your receipts, invoices, and bills, you run the risk of getting into trouble with the CRA and facing a hefty fine. The CRA could come calling at any time, which his why it’s important that you have all of your accounting records and supporting documents organized and accessible at all times. A bookkeeper takes the panic out of tax season, but can also give you peace of mind all year round by worrying about the details.

Manage profit margins: Most businesses have thin profit margins to start with, leaving little room for wasting money on unnecessary expenses. While offering insight into how to generate larger returns, a bookkeeper can also manage your transactions, take care of payroll, ensure bills are paid on time and provide up-to-date financial data that will help you grow your business.

Being an entrepreneur may seem glamorous, but in reality it can be one of the most challenging paths. It can be stressful, exhausting and frustrating, but entrepreneurship can also be incredibly rewarding when done right. It is your responsibility to be in control of your business. It shouldn’t control you. If you don’t have a firm grasp on your numbers, you are far more likely to become one of the 8 out of 10 entrepreneurs whose businesses fail within the first 18 months.

The bottom line: What’s the bottom line? The expression refers to profit, also known as net income. Your net income is what is left after you’ve paid out all of your expenses. If you want to know how your business is doing, start by looking here. If you business isn’t profitable, or isn’t profitable enough, be open to making some changes and stay focused on increasing your bottom line.

Cash flow: Do you know how much money is coming in and out of your business at any given time? Ensuring you have a healthy cash flow is critical to your business’s success. You’ll want to come up with strategies for narrowing and closing cash flow gaps as quickly as possible. Some of the important components that affect your cash inflows and outflows are as follows: accounts receivable, credit terms, credit policy, inventory, and accounts payable.

Profit per project: When you look at your products, services, and clients, are you aware of the profitability of each? It’s particularly important to know your profit per client or project. This number will help guide you in your marketing efforts. You’ll want to focus on the projects that earn you the most money and require the least amount of time.

Whether you are a solopreneur, or an established business leader with a large company, it is crucial that your finances are up to date and accurate. If you don’t know the differences between a bookkeeper and an accountant, it can be easy to lump us all into the same pile. However, having the right team of trusted professionals supporting you makes all the difference in your success.

•Bookkeepers manage day-to-day finances.
•Accountants look at the big picture.
•Bookkeepers are in charge of record keeping and data entry.
•Accountants are in charge of analyzing the financial records.
•Bookkeepers lay the groundwork for accountants.
•Accountants prepare financial statements, tax returns and meaningful reports from the financial data.
•Bookkeepers are responsible for the financial information infrastructure of a business.
•Accountants are responsible for the financial reports based on the bookkeeping process.
•Bookkeepers are qualified to record and organize financial transactions.
•Accountants are qualified to handle the entire accounting process.

Taxes. They’re probably one of the least glamorous parts of running a business, but whether you’re a one-person business, have a small team of helpers, or run a sizable company, taxes should be high on your priority list. Taxes are one of those things that may seem tedious and inconsequential, but if you don’t take care of them the CRA will definitely notice and that could mean the end of your business.

Register: The CRA defines a business as an entity that engages in activities that are expected to earn a profit. There should also be evidence of the intention to earn a profit. All businesses, no matter how small, have an obligation to register with the CRA. You can choose the structure (sole proprietorship, partnership or corporation) based on your needs and goals.

File and pay on time: Once you’ve registered your business, you are then responsible for correctly filing and paying your taxes on time. It’s in your best interest to pay on time if at all possible. If you don’t, interest fees will start piling up and you’ll pay over and above what you owe.

One more thing: You have to determine the specifics of your provincial and federal tax responsibilities based on the type of business you own. In addition to sales tax (GST/HST), you also need to file and pay payroll taxes if applicable and of course your own income taxes. Other taxes may also apply. Finally, you need to comply with all tax filing requirements, including having the relevant documentation on hand (receipts, bills, invoices, etc.).