Should You Do Your Own Bookkeeping
Bottom Line: You should hire a competent bookkeeper to manage your financial records, if you can afford it.
Summary
Determining the correct time to hire a bookkeeper can be a challenge for business owners. It is appropriate for entrepreneurs to do their own bookkeeping initially, prior to generating revenue and achieving profitability. However, it is possible for entrepreneurs to hinder business growth by spending too much time on tasks that should be outsourced. Bookkeeping and accounting are critical to business success, but they are likely not the reason that the business exists. Further, bookkeeping probably isn’t a core competency of the entrepreneur that started the business.
When to Hire a Bookkeeper
Trail Basis developed the following decision thresholds for entrepreneurs to use when deciding hire a bookkeeper, or not.
If do-it-yourself bookkeeping is competing for your capacity with more important tasks, hire a bookkeeper.
If you are unable to keep track of who you owe (accounts payable) or who owes you (accounts receivable), hire a bookkeeper.
If you unable to manage tax compliance, hire a bookkeeper.
If you want to implement data-driven decision making, hire a bookkeeper. Bookkeeping (financial record keeping) is the foundation of data analytics and is the first step to understanding and leveraging the data that your business creates.
If your business will need audited financial statements, hire a bookkeeper.
If you intend to pursue grants that have compliance requirements, hire a bookkeeper.
If you have decided to hire a bookkeeper and would like to work with Trail Basis, reach out.