What Accounting Services Do Small Businesses Need?
As the owner of a small business, you have to be a jack-of-all-trades. It’s your vision that drives the business, and your know-how that keeps it running on a daily basis. It’s more than just a full-time job. It’s a passion. And unfortunately, along with that passion you get a lot of administrative tasks. When you add in things like accounting, the list of daily tasks for a small business owner gets pretty intimidating.
There’s plenty of opportunity for small business owners to outsource their accounting services. In short, outsourcing means using another business or person—someone who is not employed by your company—to perform a basic function for your business. And there are few functions that are more important and more appropriate to outsource than accounting.
When you’re looking to outsource, it is important to understand the range of potential services that are available. Let’s look at a list of accounting services for small businesses, and how you can get the best quality accounting by outsourcing.
Bookkeeping and Accounting Services for Small Businesses
Many small business owners use the terms bookkeeping and accounting interchangeably. There are subtle but important differences you should understand as you consider the list of accounting and bookkeeping services for a small business. A good outsourced accounting firm will be able to cover a wide spectrum of accounting services for small businesses and be able to offer customized solutions that fit your needs and your budget.
Let’s look at just a few basic services commonly offered below and the value they provide to a small business.
Bookkeeping is the most basic of accounting functions for a small business. In simple terms, bookkeeping means keeping track of a business’s financial records, like accounts receivable and accounts payable, credit card transactions, payroll entries, and more.
Good bookkeeping is essential to a well run business and provides the foundation for accurate and timely financial reporting. Without good bookkeeping, a business owner is steering blind when it comes to making good decisions.
In order to understand how a business is performing and in order to assess the overall financial health of the organization, an accountant must prepare financial statements on a monthly basis. Monthly accounting is the process of closing out the books by reconciling balance sheet accounts, reviewing operating results and preparing reports for management. It is performed by an experienced accountant or Controller. While bookkeeping records the transactions and provides a foundation of good record keeping, monthly accounting delivers the information and the insights necessary for good decision making.
Cash Flow Forecasting
Cash flow forecasting is a common need for most small businesses. In good times and in bad, the ability to forecast cash flow is an essential ingredient to a well run company. Combining historical trends with projected estimates, a good accountant can forecast the inflows and outflows of the business in order to avoid surprises and plan for the future.
Unless, as a small business owner, you already have high-level CFO experience, it’s not always an option to have a CFO in-house. When you’re looking at accounting services for small businesses, you’ll find that some offer an outsourced CFO or fractional CFO. This means you can effectively buy a portion of a CFO’s time to help you make thoughtful decisions about the finances of your business, and provide sound strategic guidance. In some cases, they may even meet with stakeholders, or actually help run day-to-day operations.
You’re not just hiring an accounting services provider—you’re getting a team of people who will know and understand your business in-depth. As that relationship grows and matures, so will their knowledge of your organization. A good outsourced accounting firm will not only be able to help you keep your financials on track, they will also be able to help you identify and implement new technology solutions or enhanced processes that can drive efficiency and improve the flow of information in your company. Ultimately, they are there to help you grow and reach your goals.
At Milestone, we believe every business, no matter their size, should have access to quality accounting support and expert guidance to help them reach their goals. We combine the latest cloud based technology with experienced accountants to deliver solutions that make a real difference. Contact us today for a free consultation.
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