Your financial support will of course depend entirely on the size of your business and the level of financial activity which occurs.
At the small end of the business scale, such as a sole trader, doing your own bookkeeping can be feasible but a visit to an accountant twice a year is a smart business move. Establish a relationship with your accountant, as they get to know your business, the more they can assist and if your business grows they can grow with you.
In a small business you may not be able to employ a full time bookkeeper, so outsource the task, it is also a smart business move and if your business grows to the extent you need the expertise in-house, make your bookkeeper an offer they can’t refuse. Still make the visit to an accountant at least twice a year.
A medium business could have an accounts receivable function with all the skills in-house, or maybe an administration function which looks after day to day activities with a bookkeeper outsourced to do monthly tasks. This business should have an accountant with more regular visits.
Larger businesses need this type of resource, knowledge and expertise in-house with a fully functional accounts receivable section.
So what are the differences?
A bookkeeper is generally an administrative role taking care of day to day activities, recording transactions such as internal purchasing, receipting, tracking expenses and the sales and invoicing. Then the regular reconciliations of all these transactions. A bookkeeper should know the basics about taxation matters, which taxes apply, when they should be paid and how to pay them.
An accountant will take what the bookkeeper has managed and will verify and analyse the numbers and provide advice on the businesses future such as forecasts, business trends, opportunities for growth or when to slow down.
An accountant will also perform audits, do the yearly financial returns and reporting including profit and loss and balance sheets.
While accountants are all about detail like a bookkeeper, an accountant will also look at the big picture and be involved in defining the business strategy and goals.
Where you are in the lifecycle of your business will determine your accounting requirements. Regardless of how you do it, your financials should always be up to date and accurate, otherwise nasty shocks can occur and incur large fees. Don’t think you are OK, just because you have accounting software and the numbers are being entered as they should. Yes, many packages can produce the necessary BAS reports, even do electronic transfers when required but someone still needs to input the necessary data to get the correct output.
Know when you need to make the step up to more assistance, when you are not keeping up with the daily transactions is one very good clue to reassess the situation.
If you are someone who simply struggles with numbers no matter how small the task, mostly the “right brainers” out there, then don’t mess around, get someone to do it for you. You may think it a headache to deal with under normal circumstances but the fallout for not doing it regularly or correctly will produce a severe migraine.
Factoring is also a good way to outsource accounts receivable tasks and for maintaining a regular cash flow, critical for any size business.