bookkeeping tips
26-Jun-2021 By - team

Bookkeeping is a proud and ancient profession. The earliest accounting records dated back 7,000 years and were found in ancient Babylon, Assyria and Sumeria. These tokens recorded the growth of crops and herds. Later, as kings rose to power, they hired “bookkeepers” to manage their stores and tax collection.

Bookkeeping has come a long way since those days and has seen many changes and innovations. But as more and more accountancy work is being automated, many bookkeepers are looking to the future with trepidation. Is bookkeeping becoming redundant?

Example of ancient Babylonian accounts.

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It is a Truth, Universally Acknowledged, that Desktop Accounting is Becoming Extinct

Just as the ancient token system gave way to more advanced methods, so too are we experiencing a paradigm shift in bookkeeping methodology. More and more business owners are shifting their processes online, especially as smartphones and mobile technology are becoming increasingly intuitive and available. Business owners want to be able to access their accounts anywhere in the world, from any device.

With Xero’s cloud-based accounting software, accounting is becoming increasingly automated. We’re living in the age of the paperless, mobile and global office, and there’s little call for data entry or book-balancing. As a bookkeeper whose business model has revolved around data entry for literally thousands of years, the prospect can be pretty scary.

But it doesn’t have to be.

The Books are Changing, and so are the Bookkeepers

Instead of fearing the impact of cloud technology, bookkeepers should be embracing it. Cloud-based accounting makes bookkeeping much more efficient. It is not the harbinger of doom for your business but a tool you can use to improve your system.

Think about it. You have access to all the information you need, 24 hours a day. Neither you nor the client has to print out screeds of paper or travel across the city to deliver files. You can run your bookkeeping business from any location and work with clients from all corners of the globe.

Xero is free for accountants and bookkeepers, and you don’t have to worry about upgrading your licence every time there is a change – that’s all taken care of for you as part of your subscription. Your software outlay is significantly reduced. For the client, the low monthly subscription fee is manageable. To a large extent, the automated bank feeds and rule-based reconciliation mean a large chunk of a bookkeeper’s time is now freed up. What are you going to do with this time?

Well, you could take on more clients, for one. More clients = more revenue. And that’s always a good thing. As a business (small business) flourishes in the wake of the global recession, more and more people will need bookkeeper’s services. Cloud-based accounting software will never eliminate the need for bookkeepers because a person needs the financial knowledge to understand what is happening with these programs. Most business owners would rather outsource this to someone with the know-how than learn themselves.

Alternatively, cloud-based accounting is opening up opportunities for bookkeepers to expand their role. As long as the bookkeeper doesn’t go outside the parameters placed on their business through the relevant legislation, they can add many new services to their repertoire.

Any part of the business where a sale, payment, or invoice is involved comes under the bookkeeper’s umbrella. Think of additional services you might be able to provide under payroll, accounts payable, accounts receivable, stock, point-of-sale, e-commerce, etc. It’s all about helping your client become more efficient and giving the client advice about the best way to record their information.

The blog BoxFreeIT interviewed Rob Comelli, CEO of the Association of Accounting Technicians, about the future role of bookkeepers in Australia. He had some fascinating insights into the value bookkeepers can add to their businesses without breaking the rules around being a BAS Agent.

Collaboration Opportunities between Bookkeepers and Accountants

There can sometimes be tension between the two camps, as bookkeepers and accountants can occasionally view their services as competitive rather than complementary. By forging a collaborative relationship with an accountancy firm, you can offer your clients the best of both worlds.

Xero published a blog post describing the collaborative relationship between an Australian-based bookkeeper and an accountancy firm. Toni McCulloch from Accounting North explains that the main benefit of working closely with Briohny de Vere of Bees Knees Bookkeeping was that she could trust incoming information to be accurate and fully reconciled. This allows the accounting firm to focus on profit, cash flow and growth for the business.

With the old desktop accounting systems, there was always a gap between the bookkeeper’s and accountant’s work, which often caused friction as each saw their role as separate and didn’t communicate with the other. But if both parties are using Xero, they can access all the information simultaneously, and adding WorkflowMax into the mix means collaboration and job tracks are made even more accessible.

So how should this relationship work? Generally, the day-to-day accounts functions would be overseen by the bookkeeper, who can defer to the accountant if any tricky problems arise. Accountants will typically work on company set up, depreciation, and getting the best result at tax time. Bookkeepers can take care of any overflow work from the accountant and bring up any issues they notice with the accountant before the year ends.

Accountants and bookkeepers can also pool resources when generating leads, find new business, and refer clients to each other, increasing wealth for all concerned.

Xero takes a proactive approach in encouraging accountants and bookkeepers to work together through training, webinars and the Xerocon conference.

But What If I Don’t Want To Change?

Well, you don’t have to. Nobody is forcing bookkeepers to embrace cloud-based accounting.

The truth is, not all bookkeepers are keen to embrace cloud-based technology. And there are plenty of clients out there who feel the same way. Many business owners will resist change even more than you and want to keep using the same systems they’ve used for decades. If you’re not keen on learning new technology, then focus on providing bookkeeping solutions for these clients.

Just be aware that these cloud non-adopters are a rapidly shrinking market, and their business profits are often shrinking as well.

Perhaps it’s time you thought about your reasons behind resisting change? Is it that you feel too old to reshape your business? Are you scared because you’re being taken out of your comfort zone? Do you feel overwhelmed by the technology? Perhaps if you educate yourself more on what cloud-based accounting software can do, you might change your mind? There’s only one way to find out …

understanding-bookkeeping

Positioning Yourself As A Consultant

So what do you do if your client wants to cut overhead by doing their books themselves? With the economic recession still at the forefront of many business decisions, clients and business owners take a hard look at their expenses, and cutting back on professional services such as bookkeeping is their first cost-saving strategy. With cloud-based accounting, a client can automate so much of the process; they may come to believe you are replaceable. This is the biggest concern of bookkeepers in the changing environment.

But it’s important not to write that client off immediately. We all know that bookkeepers provide value beyond simple data entry, but the client might not understand that. By listening to their problems, you might be able to come up with a solution that could benefit you both.

You could demonstrate that by looking at their time at an hourly rate, it is more cost-effective for them to hire you than it is for them to do the books themselves. You might, for instance, be able to use their financial reports to show them where they can trim fat from their business in another area.

If they are truly set on doing their books themselves, they will probably need some training to understand how the system works and what they need to do month-to-month with their accounts. After the workout, they may need ongoing support as they learn the intricacies of the system. And who better to provide this training than you?

Show them ways of improving their efficiencies in other areas, perhaps by using workflow management software like WorkflowMax, saving them money and increasing their productivity. A bookkeeper can be particularly effective in the area of business-based technology. Demonstrate your value through the extra advice you provide.

Offer a pared-back service where you only perform some of your usual tasks, and they conduct the rest. For example, you could do the bank reconciliation each month or offer a quarterly review of the books. This will help your client identify problems before end-of-year but won’t be as expensive as your full bookkeeping service. This type of work alone could satisfy a freelance bookkeeper’s workload.

This type of arrangement is suitable for your bottom line, too, because your fee as a trainer and consultant should be at a higher rate than what you’re charging for essential monthly bookkeeping services.

Action Steps for Bookkeepers

So what can you do right now to help facilitate change within your business? Here are some simple steps that bookkeepers should be thinking about right now if they want to grow and flourish in the future.

  • Get familiar with the technology. This means learning all the features of Xero and learning about the add-ons, such as WorkflowMax, and the value they can provide to your clients. This means using the different available technology yourself, attending all your local training sessions, utilising online training tools, and attending events such as Xerocon.
  • Learn from Thought-Leaders in the Accounting/Bookkeeping Space. One of the best ways to figure out your accounting business’s future direction is to see what others have done and learn how they did it. You can do this by attending industry conferences, such as The Bookkeepers Summit and Xerocon, and reading case studies and blog posts online. The Pure Bookkeeping Blog, The Freelance Bookkeeper Blog, and Xero blog are great places to start.
  • Figure out your new offerings. The role of the bookkeeper is shifting from data entry to data management. Brainstorm the types of services and packages you might offer to clients. Think about where your skills and interests lie and talk to your clients about where they’re feeling stuck in business. You might be able to add value by offering software solutions to help clients manage payroll, e-commerce and point-of-sale, or assist clients who want to do their accounts with monitoring services.
  • Learn new skills. Look for gaps in your skillset that might prevent you from providing your new offerings (as decided in 3). Now is the time to start training yourself to give business advice and build on your IT skills. Learning more about solutions-focus, networking and marketing your business could also be highly beneficial at this crucial stage of your business.
  • Think about how you might rebrand your business. Are you moving from a bookkeeping model to one of an indispensable business consultant? Remember, “consultants” get paid more than bookkeepers, so you might want to alter your branding to reflect your business model’s changes. For this stage, you might need the advice of a branding agency, graphic designer or copywriter.
  • Forge new collaborative business relationships. Many people and companies offer complementary services, such as accountants, tax agents and cloud-computing business advisors. Team up with these people to share resources, offer referrals and advise each other. A strong network will help your business thrive.
  • Work together with the technology providers. Ensure they continue to provide the best software solutions for your clients. You are often the people closest to the day-to-day business and provide valuable insight into what they need.

It’s a brave new world for bookkeepers out there, but that doesn’t mean the bookkeeper’s role has ended. On the contrary, bookkeepers are more critical than ever, but technology is changing their role from data entry to data management.

By exploiting the new cloud-based technology available through Xero and WorkflowMax, bookkeepers can increase their efficiency and become more productive and profitable than ever. The information bookkeepers can impart to business owners make them a valuable source of advice, which is always worth paying for.

Bookkeepers with an entrepreneurial spirit expand their services to include broader consultancy and are collaborating with accountants and other B2B services to get better results for everyone.

Bookkeeping is far from dead – it’s just evolving. The bookkeeper who collaborates and progresses will always find work.

How is your bookkeeping business changing with technology?

Bookkeeping is not a dying profession.

They enter financial transactions, track credits and debits, and manage numerical information to create financial reports. 

You can’t just start a business and wait for clients to begin working with you. Will, your clients, use the same system, or will you support a variety of them?

Here are ten essential questions to ask yourself before becoming an online bookkeeper to help you make the decision. 

Another place you can check for at-home bookkeeping work is Upwork. 

The jobs on Upwork are typically thought of as freelancers’ work, but the truth is that you might find exactly what you’re looking for there, especially if you’re open to a contract position. It might not be the place where you focus your job search attention, but it’s at least worth checking out. It might be worth applying for a few bookkeeping jobs in your area and seeing about converting the position to a remote one.

You might have prior professional experience to serve as a springboard to gaining new clients and helping them well. I work part-time outside the home as a bookkeeper and wonder if the skills I already have (or a little extra training) would help me find a work from home job. Hi…I’m the controller for a bustling business in Long Island and have been doing bookkeeping for 30 years. I’ve had some unfortunate events happen recently and need a second job to help supplement my current income. Since I’ve been in the bookkeeping field for many years, I was interested in exploring this option.

There are many different accounting software types, and you need to decide what you will work with. Not every part of online bookkeeping requires this much focus, however. These include marketing, answering emails, and working on networking retained earnings with others. But, when it comes time to do the actual bookkeeping, you should have a distraction-free environment. Since many businesses and entrepreneurs need help with their books, this can be a profitable work-from-home opportunity.

I also spend some time working on increasing my knowledge of bookkeeping skills and how to improve the processes for my clients so that we can make things run more smoothly. I had always enjoyed math while I was in school and enjoyed my banking industry job, where I analysed tax returns and made loans to local businesses and individuals. To get the real scoop for this Bookkeeper Business Launch review, I wanted to interview a student that went through the program. Some virtual bookkeepers are even reported to earn up to $151,000 per year.

Get the Right Accounting Software

Even if you’re an entirely virtual bookkeeper, you still need to inspire your clients’ confidence that their private and personal information is handled with the utmost security and confidentiality. When you’re working from your home, you must reassure your clients that you’re actively and carefully securing their data. 

Having a virtual home office with a locking door (controlled access) is the best way to do this. If you don’t have the space for this, aim to have a desk with locking drawers where physical paperwork can be kept. Also, make sure your computer is password-protected and that no one but you signs into it.

Virtual Bookkeeping Defined

virtual bookkeeping

Besides applying to work for a bookkeeping company, you can look for an at-home bookkeeping job the same way you might look for a more traditional bookkeeping job. This is a unique job in that it’s something that can be done from home more often than not. Sometimes finding the perfect at-home job starts with finding a tremendous traditional position and then transitioning it to being home-based. 

If you decide to work for a company that contracts with other organisations to provide bookkeeping services, you’ll still be working from home, but you might have several different clients. To be a successful online bookkeeper, you need to be able to make a connection with your clients.

  • One effective way to do this is to volunteer for a local non-profit and get to know more people in your community.
  • I would argue that the role of a bookkeeper is changing even more than that.
  • These jobs primarily are seasonal but can be full-time or part-time, and some of these seasonal workers will be made permanent.
  • Watch for webinars, online courses, books and training sessions relevant to the bookkeeping, finance and accounting industries.
  • The best things about a virtual bookkeeping job are the income potential and positive job outlook.
  • I have over 20 years of experience in bookkeeping and management and have decided to start working for myself and control my destiny and success!

Launched in 2010, this Virtual Assistance company includes virtual bookkeepers as part of their talent pool. Freelance bookkeepers who have multiple clients usually charge by the hour. This type of delegation is how huge accounting firms can cater to numerous clients at any given time. 

Bookkeepers perform various accounting tasks without any problems, but they often have to submit sensitive documents to licensed accountants for approval. A bookkeeper is someone with advanced accounting skills and knowledge of preparing financial statements in the traditional economy.

Of course, having this much flexibility means that you’re going to work harder than traditional bookkeepers, especially if you decide to go the freelance route and seek clients on your own. Home to many freelancers, FlexJobs has an entire category dedicated to home-based bookkeeping jobs. 

Not much is posted about the virtual bookkeeper job, but the company accepts resumes all year round. It is home to many part-time and full-time licensed accountants, bookkeepers and other finance professionals. Belay is always on the lookout for people with at least five years of accounting or bookkeeping experience and advanced skills in QuickBooks.

I stumbled across this site in search of opportunities offered to virtual bookkeepers. I’m glad I found it in the early stages of my searching instead of having to learn from my own mistakes. 

Note that the $2k capital I stated only includes you as the primary bookkeeper who would offer clients services, so you’re practically investing in your skills. The best things about a virtual bookkeeping job are the income potential and positive job outlook.

No amount of technology or outsourcing will replace the need for financial understanding among those who make financial decisions and run businesses.

 The role of the ubiquitous bookkeeping software is to organise and process the data. Still, the decision making based on all that data will ultimately remain with skilled and intelligent humans. Despite the slowing or declining trends in Oregon intuit payroll and the nation, those with a passion for numbers and books will be able to find suitable employment prospects. 

A certain level of bookkeeping skills may be included in other job descriptions and is particularly crucial for managers and business owners. It is common for small businesses to require bookkeepers to process payroll and perform other office related duties as needed.

You can also get access to the Bookkeeper Business Launch student community called the Rockin’ BBL Students Community. There are also case studies as well as interviews from people sharing their Bookkeeper Business Launch success stories. 

After intuit payroll enrolling in the Bookkeeper Business Launch program, you will receive the following. Currently, the premier course + coaching for Bookkeeper Business Launch price is $2,997. Or, if that is tight on your budget, you can make 12 payments of $299.

And this has paved the way for old-fashioned jobs like bookkeeping to survive globalisation. Bookkeeper Business Launch doesn’t provide mentoring, but the group (fellow students and those answering the emails) can help you with a large variety of situations to help you learn and grow. 

There is a team of great people who are available to support you via email – they are all existing bookkeepers with years of experience who can help you through most problems. And if they can’t help you, they will point you in the right direction to help you get the help you need. I was provided with the necessary tools to find clients, work with clients, get paid on time, and grow my business.

What are the best ways to go about starting an at-home bookkeeping business? Holly Reisem Hanna is the publisher and founder of The Work at Home Woman, helping individuals find remote careers and businesses that feed their souls since 2009.

To protect their income, bookkeepers should consider value pricing and pricing models using fixed retained rates, he advises. Most of the established companies that hire virtual bookkeepers require a BA as a minimum. 

I am new to the retained earnings world but am determined to create a stake in this for myself and become successful. I have over 20 years of experience in bookkeeping and management and have decided to start working for myself and control my destiny and success!

Through her unconventional career path of holding over 30 jobs and obtaining two college degrees, she’s been able to figure out how to find a career path that you’re genuinely passionate about. 

Working as a bookkeeper is an excellent way to make good money and gain the flexibility and freedom you crave. There’s not much set-up or equipment required, aside from a computer, an internet connection, and bookkeeping software. 

While learning the ropes of bookkeeping can take some time, almost anyone with a head for numbers and a propensity for data entry can know with practice.

Guest post by : team Form -

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