What is a Bookkeeper and How Much Do Bookkeepers Charge?
A Bookkeeper is an accounting professional who is responsible to keep a complete list of sales, purchases as well as any other transactions in the financial realm. The type of transactions that are accounted for and the way they are recorded may differ greatly based on the needs and procedures of various organizations or individuals.
Responsibilities of a Bookkeeper
Bookkeepers are accountable for giving accurate and up-to-date financial information regarding a company. They're constantly monitoring the health of a company's finances. Most of the time, the reports they provide go to managers and owners of businesses to aid them in making decisions. However, some bookkeepers actually participate in the development of strategies. Bookkeepers can also share jobs with accountants, as they create annual financial statements as well as tax returns.
Bookkeeping Duties
Two of the most fundamental tasks of small-business bookkeeping is data entry and bank reconciliation. Without these, all other bookkeeping tasks fall over. Let's look at the primary tasks of a bookkeeper.
Data entry: Recording financial transactions as well as keeping the books balanced.
Bank reconciliation: The books should be cross-referenced against bank statements as well as other sources to confirm the accuracy.
Monthly reports: Providing a summary of the company's financial standing.
Accounts payable: Ensure that the invoices of suppliers are correct and are paid promptly.
Payroll: Calculating salary and deductions.
The cost of Part-Time Bookkeeping for Small and Medium Sized Businesses
The bookkeeping rates for part-time workers charged by bookkeepers differ according to the location and the scope of work. The majority of bookkeepers who are part-time charge approximately £25 per hour to perform the general bookkeeping functions and their work is usually supervised by the company hierarchy. It is a good idea to supplement your accounting activities with a part-time bookkeeping worker if you have a basic working knowledge of accounting as it helps in alleviating some of the mundane tasks of data entry into accounting ledgers, recording business transactions, processing vendors' invoices, and collecting payments from customers. The managers will also need to oversee the bookkeeper part-time to ensure the quality and consistency of accounting tasks.
In the majority of cases, companies would prefer to educate and assign bookkeeping duties to an employee already working within the organization in order to reduce costs. Although this might appear as a viable alternative to employing an in-house bookkeeper on a part-time basis, it could backfire in the event that the bookkeeping done by the employee does not meet the standards that are required under accounting regulations. This could have negative financial consequences for the entire business over the long term.
The Cost of Hiring a full-time Bookkeeper for a Small or Medium Sized Company
On average, based on the experience and location an average full-time bookkeeper is expected to get between £25,00 and £45,00 per month from an organization. Recent data released by the job search website, Glassdoor.com, revealed that full-time bookkeepers earn an attractive salary that can reach £70,000 per year.
If making sure that your business is in good condition and is regularly up-to-date is essential to the financial viability of your company, then hiring a full-time bookkeeping expert could turn out to be a smart decision. The bookkeeper who is full-time will handle day-to-day accounting, making payments, sending invoices out, managing accounts payable, processing payroll, and creating the monthly statements of financials. But, just as with a bookkeeper who is part-time, the manager of the company must supervise the full-time bookkeeper in order to make sure that the quality of the accounting services delivered meets the highest standards.
The Cost of Outsource Bookkeeping Services for a Small to Medium-Sized Business
If you've determined that outsourcing your company's bookkeeping tasks makes the most economic sense for your business, you should examine the costs of hiring an outside bookkeeper. The cost you will need to pay for a full-time bookkeeping outsourcing service is contingent on the number of business transactions the firm conducts and the variety of accounting services is, however prices could vary from £500 or even an amount that is as high as £2,500 per month. The outsourcing of your bookkeeping functions allows you to customize your accounting service to fit the financial requirements of your business.
With an outsourced bookkeeping service, the company will be able to use an advanced management accounting system. This will raise the cost of your bookkeeping each month however the added cost will be completely justifiable when your company moves into the next phase of growth for business. As you grow the business should adopt an accrual-based system of accounting that is fully fledged since it will allow your business to grow through its production of sophisticated financial reports and management.
The outsourcing of your bookkeeping task could be a viable option for your business in the event that you determine that internal bookkeeping or full-time/part-time is not the best choice for your company. Many businesses are aware of reservations about outsourcing bookkeeping operations because they aren't sure how to outsource bookkeeping work. However, in the present day, particularly with modern and advanced technology, accessible outsourcing bookkeeping services can provide an advanced and cost-effective option for businesses.
Benefits of Outsourcing Bookkeeping Services
There are many advantages to outsourcing bookkeeping services as it is a feature that isn't available with an internal bookkeeper employed by the company. With a variety of outsourced clerical, administrative, and auxiliary bookkeeping support options available on the market, companies can avail of every service on an hourly, per-month basis, and then tailor an accounting service plan that is in line with the financial needs of the company. Implementing a full-service management accounting system, by employing an outside bookkeeper is an advantage for the business because the operation of this accounting system could aid in the growth of your business during the development phase.
The outsourcing of your bookkeeping task implies that the person who was initially in charge of overseeing your company's accounting for a short period of time, will be relieved of the bookkeeping duties and be transferred into a more important business development job, creating more revenue for the business. This will encourage career advancement for your most successful employees and provide them with the incentive to contribute more effectively to the company's business culture and overall performance.
Need Help?
Make Pro Tax Accountant the one-stop shop for all your accounting and bookkeeping needs. We will help you with your business's growth by enhancing the cash flow of your business and its bottom line through our bookkeeping skills. If you're interested in financial advice more broadly than bookkeeping, you can contact us.