This may be a big question that entrepreneurs face in their career. They think “Sure, I can do it myself with Quickbooks, there’s nothing to it.” This is absolutely feasible when the business is small but could prove to be difficult when the business grows and the owner has to scale accordingly. During these times, any entrepreneur should focus on the growth of their business and not so much the record keeping.
When to hire a Bookkeeper
The Fresh Diet CEO Zalmi Duchman went five years without a bookkeeper. Once hired, he cleaned up records that incorrectly mingled expenses and assets, reviewed employee purchases for duplicates, and took over the mundane but critical task of paying bills. Duchman estimates that he is saving $500 to $1,000 in late fees every quarter. “I definitely have been able to make better and more educated decisions,” he says.
Serial entrepreneur Aaron Sylvan hires a bookkeeper within a few months after the start of a new venture. He’s usually too busy to focus on recordkeeping so the bookkeeper will just spend a few hours a month to help track his spending. “When things begin to stabilize, you can see the trends and you can start to think strategically about where your money is going and where you can save.”
When to hire an Accountant
Many small entrepreneurs hire an accountant come tax time and continue to outsource them afterwards. Accountants will help with tax planning and tax filing which would take the headache away from you. After tax season is over, they can act as an outsourced CFO advising the entrepreneur on financial strategies. They help analyze the big picture of your financial position and can offer strategic advice. They also produce key financial statements to help with important decision making.
Whether you’re just starting out or you’ve already established yourself, think about the role that you play in your venture. Could your time be better spent growing your business? Whether it’s tax planning or bookkeeping, it may be advantageous to outsource your accounting functions. If anyone has any questions about this or if you need help deciding whether or not you should hire an accountant, feel free to contact me at any time!