Why SMEs Should Use an Outsourced Bookkeeping Service

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The last few years have been tough for small businesses in Australia and New Zealand. One study found that 63% of small businesses in Australia were negatively affected by COVID-19. 

In New Zealand, 43% of small businesses said they either had used or planned to use government wage subsidies to survive. When times are uncertain and cash flow is less reliable, it’s more important than ever to stay on top of bookkeeping to grow your business

Asking small business owners to manage their general ledger and strategise their recovery is a tall order. If you’re running a small- to medium-size enterprise (SME), outsourced bookkeeping service help can keep you on track. 

In this article, we’ll cover everything you need to know about outsourced bookkeeping services, including: 

  • What does an outsourced bookkeeping service do?
  • How an outsourced bookkeeping service can help your SME
  • When to outsource your business bookkeeping
  • How to choose an outsource bookkeeping service

What does an outsourced bookkeeping service do? 

You may be hesitant to start looking for an outsourced bookkeeping service because you’re uncertain of the benefits. Perhaps, you’re unsure how an outsourced bookkeeper will work within your existing business processes. 

Many outsourced bookkeeping solutions handle your day-to-day bookkeeping and back-office tasks. They also provide valuable insights that help you make better business decisions.

An outsourced bookkeeping service can free up time in your back office by tackling:

1. Bookkeeping  

Visory’s outsourced bookkeeping services optimise cloud accounting software usage, with clear workflows and platform integrations to create a connected workspace for you to access. Businesses get a dedicated bookkeeping team with industry-specific experience, to take care of bank reconciliations, journal entries, financial statements, and much more. 

2. Payroll 

With Visory’s payroll services, your staff will always be paid on time. An expert will prepare pay runs for you with clear review structures and automated payments where possible, whilst making sure your business is single touch payroll compliant. As a result, you’ll cut down the time you spend on payroll and free up more time for other parts of your business. 

3. Invoices and accounts receivable

An outsourced bookkeeper also makes sure you get paid. They keep your accounts receivable (AR) updated, so you don’t wind up with bad debts. Also, a bookkeeper will put best practices in place to stay on top of your AR, including:

  • Structured payment terms
  • Automated follow-ups 

4. Bills and accounts payable

Your bookkeeper handles accounts payable to make sure you pay supplier invoices in a timely manner. Staying on top of your accounts payable helps you maintain healthy relationships with vendors. Optimising payment schedules will also improve cash flow and reduce late payment fees.

5. Financial statements 

Quarterly reports and financial statements are time-consuming but they reveal how your company is performing. As a business, you’ll use them to help make informed decisions and monitor the financial health of your company. Also, investors, banks, and partners look over financial statements, so it’s important to have accurate reports. 

Outsourced online bookkeeping services can prepare profit and loss statements, balance sheets, and cash flow reports for you.

6. Ongoing reconciliation

Visory ensures that all transactions are accurately recorded through ongoing reconciliation. An outsourced bookkeeper matches bank statements with financial records to identify discrepancies and correct errors promptly. 

7. Budgeting 

An outsourced bookkeeping service can help you create realistic budgets and track performance against them. Budgeting can help you identify areas of improvement, lower costs, and allocate resources effectively to your business.  

8. Forecasting 

Bookkeeping experts can generate financial forecasts that provide insights into future revenue and expenditure. A bookkeeper will look at past performance or historical data and use that to better predict the future. 

With forecasting, you can anticipate financial challenges and adjust strategies. For example, a short-term cash flow forecast can tell you how much money you’ll have to keep your business running or invest back into it. 

9. Customer analysis 

A bookkeeper can analyse where your biggest sales are coming from. Visory’s bookkeepers can look at sales and revenue data to identify the most valuable clients and customer segments. 

10. Prepare for tax season

You don’t want penalties after lodging your tax returns. At Visory, we ensure compliance with tax regulations, accurate record-keeping, and timely filing. So, you minimise the risk of penalties and audits and focus on growing your business with confidence. 

How an outsourced bookkeeping service can help your SME

There are many benefits that come with outsourcing your bookkeeping and other business finances. For example, Visory can run a financial health check, so you know where your business stands. 

Here are some other benefits of outsourcing bookkeeping: 

  • Save time – Bookkeeping is time-consuming. Taking shortcuts for data entry and report running may lead to mistakes, and accounting mistakes can get costly. Your time is valuable—outsourcing your bookkeeping helps you focus more on running and growing your business.
  • Gain an objective view – You may be too close to your business to admit when one part isn’t working anymore. An outsourced bookkeeper may serve as a reality check by offering a new set of eyes. 
  • Get access to expertise – A company like Visory can match you with a bookkeeping team that knows your industry in and out. As you grow, an expert may be more helpful than a general bookkeeper. 
  • Save money – You may also save money on staffing when you outsource bookkeeping. You can reinvest those funds into research and development, marketing, and other company initiatives.
  • Better understand your cash flow – With an in-depth analysis of your spending, you can better manage your cash flow and stay in the black at the end of each month. 
  • Plan ahead with detailed forecasting – Bookkeeping is more than knowing what’s in your bank account. It’s also about keeping it full. Bookkeepers who are embedded in your business, even remotely, can update you regularly on your financial health. 

When to outsource your business bookkeeping

When your business grows quickly, you have more bookkeeping needs. These are a few signs that an outsource bookkeeping service is right for you

  • Bookkeeping and financial recordkeeping take more time than you can afford
  • Books are always out of date and in need of catching up
  • Your business isn’t taking full advantage of potential tax write-offs
  • You’re struggling to track your cash flow
  • Your accounts receivable and payable processes aren’t running smoothly

This isn’t an exhaustive list of signs that your business could benefit from using a bookkeeping service. Visory’s team helps businesses at all stages streamline their processes so you can stay focused on growth.

How to choose an outsource bookkeeping service

Selecting a competent and reliable outsourced bookkeeping service is key. The right provider will contribute to your company’s success and growth. Here are some qualities to look for when deciding on bookkeeping services: 

  • Qualifications – Ask if the bookkeeping service employs certified professionals with relevant accounting or bookkeeping qualifications and experience. These include CPAs or certified bookkeepers.
  • Industry expertise – Look for bookkeepers with experience in your specific industry They’ll understand the unique financial requirements and regulations that apply to your business.
  • Value – Is the cost worth the money and time you’ll save by outsourcing bookkeeping to an expert? Typically, outsourcing is more cost-effective than hiring in-house. 
  • Communication and support – Make sure the service in question offers clear channels of communication and timely assistance when you need it.
  • Integrations – Check whether the bookkeeping service integrates with your existing accounting software and other business tools, ensuring seamless data exchange and streamlined processes.
  • Flexibility – Will they be able to handle your bookkeeping and other back office needs as your business grows? As your business grows and evolves, your bookkeeping needs change.
  • Other services – What services do they offer outside of bookkeeping? For example, Visory also handles payroll. 

Outsourced bookkeeping keeps robust financial reporting affordable and reliable. Visory can match you with an expert who understands your industry and grants you 24/7 access to your double-entry bookkeeping, tax records, and more. Bookkeeping is a lot easier with a financial expert on your side.

How a Bookkeeping Service Can Help Your Retail Business

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Bookkeeping for retail business involves keeping a record of all your daily financial transactions within an organised accounting system. Maintaining precise records of your expenses, sales, receivables, inventory, and payables ensures that you create accurate financial reports and assess your business performance. Detailed and authentic records are also handy in case of a tax audit.

Before you initiate the bookkeeping process, you must identify the best booking system for your business and decide whether to invest in in-house bookkeeping or outsource the services. 

What Does a Store Bookkeeper Do?

A store bookkeeper records and maintains a business’s financial transactions, including sales revenue, expenses, invoices, payments, and purchases. Their responsibilities mainly involve using numbers, math skills, and accounting principles.

 Typically, bookkeepers handle the initial steps of the accounting cycle, which include:

  • Identifying transactions
  • Recording transactions in a journal 
  • Posting to the general ledger
  • Calculating the total balance for the accounts
  • Looking for errors and adjusting worksheet 
  • Adjusting entries 

Financial reporting requires maximum accuracy and one way of ensuring precision is by communicating with colleagues and clients. Bookkeepers collect purchase and sales documents from coworkers and handle other tasks that require them to engage with other parties. 

Proper communication ensures correct documentation of all transactions and eliminates chances of omission. You can enhance your line of communication by investing in a reliable system of cash distribution, expense account reimbursement, and receipt submission. 

Additionally, a bookkeeper liaises with the heads of departments to make enquiries on inventory needs. For instance, the bookkeeper can order if office supplies and products are less than needed. 

Other primary responsibilities of a bookkeeper include;

  • Processing payroll 
  • Performing banking activities 
  • Reconciling reports 
  • Producing monthly financial reports 
  • Handling accounts receivable 
  • Handling accounts payable

Some bookkeepers have expert knowledge on accounting and may take up advanced duties such as creating budgets and forecasts, tax filing, training staff on the use of software solutions, and end of year reporting, particularly for small businesses. 

How Does Bookkeeping for Retail Business Work?

Retail business bookkeeping involves creating a framework, choosing between double- or single-entry accounting methods, and keeping records.

For single entry accounting, bookkeepers make entries once, either as an income or expense. On the other hand, the double-entry transaction involves recording transactions twice as a credit or debit. Your choice of entry system impacts the accuracy of your transaction records and the efficiency level of your bookkeeping process. Typically bookkeeping for a retail business entails keeping tabs on expenses, sales, inventory, receivables, and payables. 

Inventory Accounting

Bookkeepers use reliable systems to track and record inventory movement daily into and out of the retail business. As a result, you will have a record of the cost and quantities of all supplies you receive, along with the selling price of every product sold. In addition, bookkeepers adjust records regularly to account for damaged, stolen, or spoiled goods – this ensures that the documents show accurate numbers of the available inventory. 

Since your inventory is the most significant asset of your business and probably your biggest investment, it’s only reasonable to ensure that you keep accurate records that you can access when necessary.  

Income

Bookkeepers keep records of all income that flows into the business and compare the figures with bank statements to identify any variation. While you may be generating income via other sources like after-sale service fees or consignment commissions, your sales revenue is your primary driver of income. 

Also, bookkeepers regularly perform audits of the point of sale system records to ensure accuracy. Simply put, bookkeepers keep receipts of all revenue earned and transfer the sum into the business accounting system. 

Expenses

Bookkeeping involves tracking business expenses and comparing the figures with the bank records as often as possible. A good bookkeeping and accounting system automatically records recurring, variable, and one-time capital investment expenses. All these expenses are recorded in separate accounts to make calculating profits and preparing financial reports easier. Typical expenses include rent and lease, labour expenses, taxes, fees, and purchases.

Payable and Receivable

Bookkeepers handle accounts receivable and account payable. Your accounting system should remind you to clear your debts on time and manage debt collection from credit customers. 

Managing payables can raise your credit rating while keeping track of your receivables ensures that you have enough working capital. 

Owners’ Equity and Retained Earnings

Bookkeepers record all owners’ resources added to the business in a different equity account. Although this information might not be relevant in the short term, it will be beneficial in the future when a partner quits.

Additionally, bookkeepers document the amount saved, the amount retrieved, and all interest earned within a retained earnings account. 

What Types of Records Should a Retailer Keep? 

To properly determine your retail store business performance and prepare for tax time, you need to have accurate records of all your sources of income, expenses, purchases, payables, and receivables. Some of the critical documents that you need to keep include:

Journal of Non-Cash Transactions Affecting Accounts Payable

This journal lists the amount of money you owe another business or individuals after purchasing inventory on short-term credit. It includes the actual amount owed, the creditor, payment date, and the date when you cleared the debt. You can’t be charged twice for one service or product with this record.

A Journal of Cash Transactions

A cash transactions journal contains records of all payments you make in the form of cash. Some cash transactions include;

  • Cash refunds after the return of goods sold
  • Payment to creditors
  • Cash payment for rent, insurance, salaries, and other expenses
  • Cash withdrawal

Sales Slips, Invoices, Receipts, Cash Register Receipts, and Other Sales Documents

Sales documents indicate the quantities of products you sell and the revenue your retail store makes daily, weekly, and monthly. In addition, they include the type of goods or services sold and the cost of each sale. Cash register receipts, for instance, show the different forms of payments used by customers, such as credit cards, cash, or checks. On the other hand, an invoice shows the type and cost of the product you have provided to your customer. It serves as a request for payment.

Conclusion

Bookkeeping for retail business is key to business success and growth. Without proper financial reporting, chances of making business decisions based on inaccurate financial statements are high. And most importantly, you are legally required to use correct records when filing taxes. It’s never too late to get started. Learn about Visory’s Bookkeeping Services.

Single-Entry vs. Double-Entry Bookkeeping

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One of the significant decisions you must make when starting a business is whether to use double or single-entry bookkeeping. Your business survival highly depends on your ability to maintain accurate records of all your financial transactions. So, which is the best bookkeeping system for your business? This article discusses single entry vs. double-entry bookkeeping plus the pros and cons of each financial reporting system.

What is Single-Entry Bookkeeping?

Single entry bookkeeping is an accounting system that features one entry for every transaction. It is an excellent choice for small, uncomplicated businesses with minimal activity. 

With a single-entry bookkeeping system, you will record transactions like taxable income, cash, and tax-deductible expenses. Each transaction included in the single column can either be negative or positive. However, you can also add expenses and revenue in a two-column ledger with each transaction on one line. 

You can manage your single-entry bookkeeping system in accounting software or use a spreadsheet or paper. A typical single entry journal contains details like;

  • Date 
  • Transaction description
  • The value of the transaction; can either be an expense or an income
  • Balance

The last row on your single-entry table should highlight the monthly or yearly ending balance. There is also no harm in adding another column for notes.

Advantages of Single-Entry Bookkeeping

Straightforward

Single-entry bookkeeping is simple and easy to manage, making it an ideal choice for business owners who don’t have adequate accounting knowledge. In addition, it doesn’t feature complex rules and principles of financial recording. 

Cost-Effective

You don’t have to hire a professional bookkeeper or accountant to manage your single-entry bookkeeping system; hence the cost is low compared to the double-entry system. 

In addition, a single-entry system involves recording a few transactions. It, therefore, doesn’t require an expensive software program. 

Easy to Determine Profit

A single-entry system allows you to calculate the profits or losses of your business. As a result, you can understand your business’s financial health and areas you need to reduce costs. 

Ideal for Service-Based Businesses

If you run a small service-based business, a single-entry system is an economical choice. You don’t need to invest in an expensive accounting system since you won’t be dealing with inventory complications. 

Disadvantages of Single-Entry Bookkeeping

Unsystematic and Unscientific

The single-entry system is an unsystematic method of recording and keeping business financial transactions since it doesn’t feature any fixed rules or principles for updating the records.

Hard to Track Assets and Liabilities

While this drawback wouldn’t be an issue for small businesses, it would matter for larger businesses with many assets like buildings and cars. In addition, it’s almost impossible to track the effects of liabilities with a single-entry system.  

It’s an Incomplete Accounting System 

The single-entry accounting system is considered incomplete since it doesn’t include critical accounts like inventory, payable, and receivable. Meaning it’s almost impossible to create an income statement or balance sheet.

 Generally, a single-entry system doesn’t reflect the actual financial health of the business.

Hard to Detect Errors or Fraud 

The rule of thumb in a double-entry booking system is that the credits and debits figures must match in the final report- a mismatch indicates inaccurate entries. On the other hand, the single-entry system doesn’t follow this rule; hence mistakes can be compounded without noticing. 

What is Double-Entry Bookkeeping?

A double-entry bookkeeping system involves recording financial transactions in two accounts- debit and credit accounts. It relies on the rule of duality; every transaction affects both accounts simultaneously. One account is therefore credited while the other is debited. At the end of the financial period, the total credits must equal total debits. 

It’s easier to detect errors with a double-entry accounting system due to the equation it is based on:

Assets = Liabilities + Equity 

Liabilities, in this case, represent everything you owe including payroll, and assets are what your business owns. Equity is the shareholder’s stake in the business.

Advantages of Double-Entry Bookkeeping

Ensures Accuracy and Detects Fraud 

With a double-entry system, bookkeepers can notice and correct errors quickly. All transactions are recorded on two accounts -the debits and credits must balance. Therefore, there is minimal to zero chance of mistakes, misappropriation, and fraud.

Complete Accounting System

The double-entry system features personal, real, and nominal accounts. Therefore, you can quickly generate financial reports straight from the accounts since all the relevant information is available. 

 Scientific and Systematic System 

You must follow specific rules and principles of recording financial transactions when using the double-entry system-this is why it’s classified as a scientific system. 

Generate a Trial Balance 

A double-entry system allows you to generate an income statement and balance sheet that make up the trial balance. You can monitor your business growth and assess revenue and expenditures using data on an income statement. 

As a result, it becomes easier to decide what areas need more investment and how you can cut costs to boost profits. 

Disadvantages of Double-Entry Bookkeeping

More Expensive

The double-entry accounting system requires numerous accounting books like cash books, ledgers, and journals. In addition, you might need to hire a bookkeeper or invest in bookkeeping software. It’s, therefore, costlier than the single-entry system.

Complex 

The double-entry accounting system is complex since it follows certain accounting principles and standards. You must therefore have expert knowledge and experience to manage the books. 

What Is the Difference Between Single Entry and Double-Entry?

Number of Entries

With a double-entry system, a single transaction has two entries, one in the debit account and the second in the credit account. On the other hand, a single-entry system features one entry for each transaction. 

What Is Recorded 

A single-entry system records cash flowing in and out of business- revenue and expenses. The cash can be physical cash, electronic fund transfers, or credit card payments. 

The double-entry system includes expenses, assets, revenue, equities, and liabilities. 

How Transactions are Recorded 

Bookkeepers that use a single-entry system document revenue when it flows in and record an expense when it flows out. In contrast, businesses that use the double-entry system document revenue when earned and document expenses before making payments. 

Conclusion

Maintaining correct financial records can help you prepare for the tax period, create a budget, and evaluate your business’s financial health. 

The best bookkeeping system depends on the size of your business and requirements. A double-entry system is arguably the best since it can offer a 360-degree view of all your financial transactions. As a result, it makes financial reporting more manageable and helps you make informed financial decisions. 

Learn about Visory’s bookkeeping services.

 

Should Your Bookkeeper Have Access to Your Bank Account?

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Bookkeeping is a vital part of any business. As a growth-focused entity, you should have an accountant that can help guide your bookkeeping needs and keep you on track with the best practices in the industry. Like any other professional or employee in your organisation, the accountant deserves respect and trust.

But what should be the limit for that respect and trust, especially when it touches your business finances? For instance, should your bookkeeper have access to your bank account? The short answer is, it’s a personal choice, so there’s no right or wrong decision.

Let’s face it, though; surrendering your bank details to another party isn’t the easiest decision to make. That’s why we’ve prepared this comprehensive resource to discuss the top factors to consider before giving account access to your bookkeeper. We’ll also look at other options to explore and highlight the importance of your bookkeeper accessing your accounts. So let’s get started!

Should Your Bookkeeper Have Access to Your Bank Account?

As we hinted above, giving a bookkeeper access to your bank account is a personal choice. But before you make that decision, here are some things to think about:

What Is Your Bookkeeper’s Experience Level?

The first thing to consider is whether you’re comfortable handing over control of your financial information to someone who has less experience than yourself. If you’re unsure how much experience they have, it might be worth checking their credentials and references.

How Much Do You Trust Them?

The next step is gauging how much you trust them. You need to feel confident that they won’t use your information inappropriately. That means having an open line of communication between you and your bookkeeper. It also means making sure they understand the terms of service for your bank accounts.

Are They Responsible for Managing Your Accounts?

If you choose to share your banking information with your bookkeeper, you must also consider whether they will be responsible for managing your accounts. That means being able to log into your online banking platform and monitor transactions.

Will They Be Able To Provide You With Financial Reports?

If you want regular reporting of your business finances, you’ll need to provide your bookkeeper with login credentials. And while many accounting software packages allow for remote access, you may find it easier to meet with your bookkeeper regularly to review your financial statements.

Can They Manage Your Payroll, Taxes, and Wages?

Finally, you’ll want to ask yourself if your bookkeeper can manage these critical areas of your business as well. While most accountants specialise in tax preparation and payroll services, they often offer additional support such as bookkeeping, general ledger management, and even payroll processing.

What Other Options Should You Explore If You Don’t Want to Give the Bookkeeper Your Bank Account Login Credentials?

If you’re not comfortable sharing your bank account login credentials with your bookkeeper, there are still other ways to go about it. Here are a few ideas:

Give Your Bookkeeper Read-Only Access to Your Accounts

Giving ‘Read-Only Access’ allows your bookkeeper to view your transaction history but doesn’t require them to have access to your bank account login credentials. That means they can view transaction statements and see images, but can’t complete transactions, move money, or pay bills.

Use Barriers

Several top-tier software programs enable companies to allow their bookkeepers to view financial details without being able to make changes or adjustments. This comes in handy if you only want your bookkeeper to have a level of access to your business finances that you’re comfortable with. 

Share PDF Statements

If you don’t trust your bookkeeper with your bank account details, you have the option of providing them with regular copies of your financial statements in PDF format. That way, they can effortlessly download the information and feed it into the online accounting software or print out a copy for themselves.

Why Give Account Access to Your Bookkeeper?

The benefits of giving your bookkeeper access to your bank account can outweigh the risks, and industry experts generally recommend it. If you’re still sceptical, you may change your mind after discovering what your business stands to gain should your bookkeeper have access to your bank account. Here’s a highlight of the top benefits:

Better Financial Reporting

When you give your bookkeeper access to all of your accounts, they will be able to better prepare reports for you. These reports include balance sheets, income statements, cash flow statements, and profit and loss statements. They also provide valuable insights into how your business is performing.

More Effective Budgeting

Your bookkeeper can help you create a budget and track spending. They can also implement strategies to manage your expenses better, helping you know exactly where your money goes.

Faster Payroll Processing

When you share your bank account login credentials, your bookkeeper can process payroll faster than ever before. They can easily import data from your bank statement and send out invoices to your employees.

Efficient Cash Flow Management

Your bookkeeper can quickly identify any problems in your cash flow management system. By having access to your bank account, they can spot potential issues such as overdrafts or insufficient funds.

Easier Tax Preparation

By sharing your bank account login credentials with your bookkeeper, you can save yourself some time during tax preparation. You no longer need to go back over each transaction one by one to ensure everything is correct. Instead, your bookkeeper can simply log in to your online banking portal and pull up your transactions.

Conclusion: Visory is Your Go-To Bookkeeping Service!

Visory is a top-rated service provider that offers excellent bookkeeping services at competitive prices. Our team of highly trained professionals is ready to take care of all your business-specific bookkeeping needs. We offer a wide range of services, including bookkeeping, reporting & insights, accounts payable & receivable, payroll processing, and taxes.

Our purpose is to help business owners and SMEs realise their growth goals through effective bookkeeping solutions. So don’t get left behind. We invite you to learn more about Visory’s bookkeeping services, so you can take advantage of our expertise today!

How Does Bookkeeping Help a Business?

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Finding the right bookkeeper, who can smoothly apply themselves in the role they’ve been hired to do, gives your business an edge. You need to be able to trust your bookkeeper to competently handle the important financial and accounting tasks such as reconciliation, invoicing, payroll, and preparing financial statements.

When you’re a small business owner, you may prefer to be your own bookkeeper, likely because you’re still dealing with a few transactions and want to avoid the hiring cost. However, in the future, as you expand and acquire more customers, you may struggle to catch up with your books as you will not just be handling income and expenses. You will have to track factors such as assets, employees, and taxes that require an extra hand to document consistently.

Further, bookkeepers are increasingly becoming invaluable to businesses as they advance into consultancy, training, implementation, and maintenance of business systems. Growing your brand means you are wearing many hats, which limits your ability to achieve your vision. A bookkeeper will help make the transition less stressful, as they will fill in the role of sustaining your business’s lifeline.

How a Bookkeeper Can Help Your Business

A bookkeeper essentially keeps your books in order. They undertake the mundane but vital tasks that help your business stay afloat. A growing business needs good decision-making, strategizing, and planning. Maybe you need to add another line item, develop a marketing campaign, or hire new employees; bookkeepers are tasked to prepare reports such as the cash flow, profit and loss, and balance sheet, which reveals if you have the money to do all that.

A well-rounded bookkeeper will also offer you solid professional advice and be a good problem solver to rely on when going through a rough patch in the business. In the coming decade, bookkeepers, along with other financial professionals, will largely help boost the revenue and growth of many businesses by leveraging digital tools and their professional skills.

Regardless of the size of your business, a bookkeeper is important to help ease the daily pressures of being an entrepreneur.

You’ll Have More Time to Focus On Your Business Functions

Businesses spend on average 12 hours in daily meetings, making cold calls, negotiating terms with vendors, and training their staff. If this is what your day looks like, you still have to prepare a payroll, generate invoices, and file taxes, which could take endless hours of gathering and reviewing your reports. This allows room to make costly errors with your finances and taxation.

A bookkeeper could halve or completely save the time you spend collecting, analysing, and reporting on financial documentation. This frees up your time to fully take up your leadership role and come up with ways of getting your business to the next level in your industry. Most successful organisations have not reached where they are without at most delegating work to their teams.

Save Money With an Outsourced Bookkeeping Service

Cost reduction is a leading factor when organisations outsource services, according to the Deloitte Global Outsourcing survey. This trend will likely carry on into the future as more workers and organisations embrace working online and remotely, opening spaces for third-party services.

Thinking that you’re saving money by doing your own books could potentially open your business to grievous financial consequences. One of the mistakes you can make is failing to be consistent in following up on your invoices, leading to cash flow problems. Another mistake is inaccurate tracking of your payments, which will prevent you from claiming the correct GST and tax deductions to reduce your tax bill. Outsourcing to a bookkeeper may cost you upfront in fees, but in exchange, you potentially insure your business against losing money and facing a huge tax burden.

Find Business Opportunities and Optimisations With Improved Reporting

Working with a bookkeeper who is knowledgeable about accounting systems makes sure you get reports like clockwork. Your financial reports show a big picture of whether your business is failing or succeeding. A bookkeeper handles thousands of financial transactions, which need to be captured and be analysed in detail and summarised into reports that influence your decision-making. For example, when doing a market analysis to determine if you can set up a new store in a different location, a cash flow projection will inform you if it makes business sense. Your bookkeeper is best suited in preparing a cash flow projection as they are deeply involved in the operations of your business.

Reports also enable you to identify areas needing improvement to boost your business’s revenues and market position. Also, taking advantage of automation in your reporting helps your bookkeeper to give you value for your money.

Get the Most Out of Your Existing Bookkeeping Software

Many bookkeepers are going a step beyond their normal roles, like training staff on how to use accounting software. They are also helping in choosing the right software that is customised to a business’s needs.

Most cloud-based accounting software like Xero helps bookkeepers to smoothly perform expense tracking, financial reporting, billing, invoicing, and budgeting, so your business stays on a growth trajectory. However, bookkeeping software is only useful if it’s fed with relevant and accurate information, which a bookkeeper can handle without a challenge.

Outsourced Bookkeeping Is More Affordable Than Hiring a Full-Time Employee

Many growing businesses prefer to outsource to third-party providers rather than have an employee on payroll to save costs. A full-time employee can cost you thousands of dollars in training and benefits. In comparing costs, the annual salary of an in-house bookkeeper is an average of $67,500, while outsourced bookkeeping services will cost you from $500 to $5,000 per month, which is $60,000 per year if you’re a small to medium-sized business. The difference in service charges is $7,500, which is significant. 

In addition, outsourced bookkeepers have the tools and capacity that your business may lack, which translates to better tracking of spending and generating more revenue. They can also act as your trusted advisor as there’s no conflict of interest, unlike with an employee, which could expose your business to fraud.

Working With a Bookkeeper Is the Right Move for Your Business

Your team is one of the best investments for your business. Having a bookkeeper as part of this team means your accounting and financial needs will be met with the utmost professionalism and integrity. Ultimately, you have to get the right person for the work to avoid paying for messy accounting work in the future. Aside from having the right training and experience, finding a bookkeeper who is dedicated and strategic with your vision is impactful to your success.

If you’re looking for a reliable and trusted bookkeeping solutions provider, Visory is here for you. Our bookkeeping experts will help fix any issues with your books of accounts that are stopping your business from scaling up. Go ahead and get in touch with us today to learn about Visory’s bookkeeping services.

What Should You Look for in a Bookkeeper?

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As a business owner, you have a lot of tasks on your plate. When you’re first starting out with your business, you’re likely going to do everything by yourself or with a few trusted colleagues so that you can save money and get your business going. But once it’s up and running, you’ll want to start hiring out certain tasks so that you can focus on what you love: pouring into your customers and your business. 

One of the first things you’ll want to hire is a bookkeeper to help you manage your finances. You’re likely not a bookkeeper yourself, so you may not know exactly what to look for when it comes to picking the right bookkeeper. Let’s take a look at the most important things to look for in a bookkeeper so that you can find the right one for your team.

What Should You Look for in a Bookkeeper?

When looking for a bookkeeper, the main thing to find is someone who is professional and trustworthy. A bookkeeper handles your finances and spends time working in your bank accounts–if they don’t know what they’re doing or if they’re planning to steal from you, you’ll be in a heap of trouble. Here are some essentials to look for in a bookkeeper before you hire:

  1. Experience in your industry
  2. Knowledge of your bookkeeping software
  3. Knowledge of Accounting Policies and Procedures
  4. Regular reporting and financial updates
  5. Tax preparation knowledge
  6. Client and customer relationship skills

Experience in Your Industry

There are a lot of bookkeepers out there, and they all likely have general bookkeeping experience. However, for your business to thrive, you need a bookkeeper who knows your industry like the back of their hand. That way, they can assist you through the most complicated and niche of transactions and financial questions.

Find a bookkeeper who has worked in your industry before and understands any specifications to your industry that must be maintained for your success.

Knowledge of Your Bookkeeping Software

When hiring a bookkeeper, you don’t want to have to start the process of collecting your financials all over again. If you already have bookkeeping software dedicated to handling your accounts and managing your transactions, ensure that your bookkeeper knows how to use the software before you hire them.

Check if they have knowledge of Xero, Myob, Quickbooks, or whatever other resources you currently use to manage your books. It’s crucial that they can seamlessly integrate with your software and start managing your financials from there. 

Knowledge of Accounting Policies and Procedures

When running a business, it’s essential that you have a set of policies and procedures around your accounting and financial practices. Your bookkeeper should know how to manage policies and procedures, both those that you have set and those set by governing agencies such as the Australian Accounting Standards Board (AASB).

Government laws dictate financial reporting requirements, standards for non-profit and for-profit businesses, important disclosures, etc. Your financial policies should detail policies for who has access to your financials, how you hire employees, how you manage payroll, how you handle insurance, and similar topics.

Ensure that a bookkeeper has a good understanding of Australian national policies as well as your personal policies so that they can effectively run your books without breaking the laws and causing problems.

Regular Reporting and Financial Updates

If you’re going to hire a bookkeeper, a lot of your financial management will likely be taking place outside your business and knowledge. However, it’s still important that you know what’s going on in your finances so that you can make wise business decisions. When hiring a bookkeeper, you want someone who can provide you with regular reporting and updates about your finances.

With regular reports, you can keep track of what’s going on with your money. An exceptional bookkeeper may even give you advice on the financial decisions you can and should make based on their reports. Plus, it’s crucial to have regular reports ready so that when the government requires one, you don’t have to spend frantic weeks trying to put something together. 

Tax Preparation Knowledge

Managing taxes for a business can be excruciating for someone who doesn’t know a lot about taxes. Before you hire a bookkeeper, make sure they understand all the ins and outs of tax preparation, including:

  • Lodging or filing sales tax
  • Managing deductions
  • Preparing employee tax forms
  • Meeting due dates
  • Lodging income tax returns

Client and Customer Relationship Skills

While financials may be the most important aspect of a bookkeeper’s job, you don’t want to hire someone who can’t handle relationships with clients and customers. You want a bookkeeper who is willing and able to reach out to you with any questions or concerns. You want someone who can ask questions if there are financial discrepancies and who provides you with a detailed explanation of any financial issues they run into.

Plus, you want someone able to talk to you anytime, anywhere, with answers to your financial and tax-related questions. You don’t want to have to wait days for an answer to an important question! Find a bookkeeper who values communication and will keep in touch with you and your team in an empathetic, friendly, and honest manner.

Questions to Ask Before You Hire a Bookkeeper

As you’re searching for the perfect bookkeeper, there are a few questions you can ask each prospect to determine that you’ve found the right person. The questions you should focus on include:

  • What is the scope of the bookkeeping work and your needs? You should be able to thoroughly explain your needs and find a bookkeeper who understands your needs. They should know how to manage the scope of work that your business requires, no matter how big or small that scope may be. 
  • Are you registered with the Tax Practitioner Board? Ensure that the bookkeeper has met the education and registration requirements set by the Tax Practitioners Board of Australia. They must be registered as a BAS agent with the board before they can provide you with financial assistance.
  • How do you communicate with clients? Again, you don’t want a bookkeeper who’s going to ignore issues, hide financial difficulties, or leave you out of the loop. Ask beforehand how and when they will communicate with you and ensure that they meet your needs. 

Conclusion

Hiring a bookkeeper is crucial to running an effective business. You want to spend your time on what matters most, so you need help from a financial professional to take some of the pressure of running finances off your shoulders. Find a bookkeeper who is professional, communicates well, and can be trusted to take care of your money.

If you’re looking for a bookkeeper for your business, come and see what Visory has to offer. We ensure that our agents can work with your software and have expertise in your industry before we hire them out to you. And with our handy chat services, you can talk to your bookkeeper or our whole financial team at any time. 

Get in touch with us today to find out more about our services and how we can meet your bookkeeping needs to help your business thrive.

How to Run a Financial Health Check for Your Business

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Your accountant will scold you for not keeping a balance sheet or income statement. Yes, maintaining accurate reports is important for any business. But what do you do with your financial documents once they’re in your hands? Analysing your financial data is just as important as collecting it.

You should run a business financial health check periodically. An annual report is prudent for the success of your business, but you may run a check more often if you are growing quickly.

Not sure where to begin? Let’s talk about the steps to taking your financial reporting and turning it into meaningful insights about the direction of your business.

Steps to determine your business’s financial health

A financial health check helps you determine if your business is meeting its financial performance expectations. Fair warning: To do the job thoroughly, you need to analyse multiple documents and compare many financial ratios. In other words, you can’t simply look at your bank statement to determine if you’re doing well.

To run a complete financial health check for a business, you should look at your balance sheet and income statement, analyse your current cash flow, and look at common financial ratios related to your debt and equity.

Analyse your balance sheet

A balance sheet is an important bookkeeping document. This report reveals the financial liquidity of your business at any given moment in time (how quickly could you pay off your current debts?). It also reveals the state of your working capital, or whether or not you have the cash to complete day-to-day operations.

Your business’s balance sheet lists assets on one side and debts and stakeholder equity on the other side. In short: Assets = Liabilities + Equity. The two sides of a balance sheet should even out. If you are doing well, your assets will be in the positive and continue to grow over time.

A balance sheet with errors, or a series of balance sheets that trend toward more liabilities than assets, may be red flags about your financial health.

Analyse your income statement

An income statement is a bit more specific than your balance sheet. It narrows its focus to your earnings and expenditures during a certain period of time, often a financial quarter.

This report reveals whether you have experienced profit or loss during the time period covered in the document. In fact, the report is often called a profit and loss statement. Your gross profit is determined by taking your revenue and subtracting the cost of goods sold.

If your income statements have an upward trend, you are likely in good shape. However, an income statement may also reveal that your expenses continue to outpace your revenue — not a good sign.

Analyse your cash flow statement

A cash flow statement measures the money or money equivalents that are coming in and out of your business. It doesn’t look at revenue like your income statement does, but rather answers the question: Where is our money going?

You can use a cash flow statement to identify seasonal trends. For instance, you may notice that costs are higher during certain periods of time. The sale of your goods and services may also wax and wane over the course of a year. Comparing cash flow statements can help you identify when to buy materials and when to market certain products. 

There are several main components that should go into your cash flow analysis:

  1. Opening balance. How much cash and cash equivalent do you have on hand at the start of the analysed period?
  2. Cash incoming. How much money came in from sales, grants, tax rebates, and other sources? You should calculate your total cash incoming. 
  3. Cash outgoing. What did you spend on purchases, rents, marketing, payroll, and other expenditures? Calculate your total outgoing cash. 
  4. Closing balance. When you subtract the total cash outgoing from cash incoming, are you left with a positive or negative number? 

Look at financial ratios

There are several key ratios often used during a business financial health check. 

  • Profit Margins: Your business has a gross profit margin and a net profit margin. Your gross profit margin measures your profits per sale before expenses. Your net profit margin reveals that percentage of each sale that counts as profit after expenses. 
  • Coverage Ratio: Broadly, a coverage ratio measures whether your business can pay its debts. But coverage ratios are often broken down into more specific expenses. For instance, the earned interest ratio tells you whether you can make interest payments. The formula is: earnings before income and taxes/interest expenses. You should aim for an interest coverage ratio of at least 2:1.
  • Current Ratio: This figure tells you whether you can pay your debts that are due in the short term. Divide your total current liabilities by your total current liabilities. A healthy ratio is at least 2:1. 
  • Debt-to-equity ratio: Your debt-to-equity measures how many of your assets are being funded by liabilities, or borrowed money. The lower the percentage, the better. 
  • Return on equity (ROE): This formula measures how efficient you are at generating profits. ROE is determined by dividing net income by average shareholders’ equity. 
  • Return on assets (ROA): Similarly, ROA determines how well you use assets to create income. Net income is divided by total assets. 

Need help determining your business’s financial help?

As a burgeoning business, running your own financial health check can lead to honest mistakes. And, well, even an established organisation can use a lot of help. As income streams evolve and the expenses of your business change, it can be hard to make heads or tails of whether you’re on the right track. 

A trained professional can do everything from keep your payroll to offering CFO-level insights into your financial habits. An outsourced bookkeeper can keep your accounting expenses low while offering meaningful analysis and keep your documents in order. Sign up for Visory’s free financial health check to see if your business is headed in the right direction.

How Outsourced Bookkeeping Services Can Help Not-For-Profits

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Australia has a large and diverse not-for-profit (NFP) landscape. In all, there are about 600,000 nonprofit organisations throughout the country. NFP groups need to maintain accurate financial records just like for-profit companies, and they often have unique complications. Nonprofits, for instance, are often responsible for mandatory audits and report to more governing bodies than for-profit businesses. 

Having a bookkeeper on your side who is well-versed in NFP finances can be a real lifesaver. As an organisation that may not have a lot of money to spend, outsourcing your bookkeeping is probably the most cost efficient option. Outsourced bookkeeping for nonprofits allows you to tap into expertise without hiring a full-time accountant. 

Read on to learn more about how outsourced bookkeeping for nonprofits can keep your organisation’s reports on track. 

Save time to focus on your nonprofit’s mission

NFPs are bound by a variety of rules laid out by the Australian Charities and Not-for-profit Commission (ACNC). And that’s on top of the standard accounting needed to keep any organisation from going broke. Between daily accounting and payroll and annual reports — you could spend hours per month on your books. 

Outsourcing your bookkeeping needs means your back office staff suddenly have more time for what matters: your organisation’s mission. If your executives are getting stressed out about filing their own reports, it’s time to call in some assistance. You can still receive and review your necessary reports without being responsible for creating them. This means staff are still knowledgeable about your financial position, they just don’t have to labour over the number crunching. 

Minimize your nonprofit’s financial risk

Even a well-intentioned staff member can mismanage your money. And, some not-for-profits rely heavily on volunteers and temporary workers, which can make trusting people with your books more complicated. You may have a rotating carousel of workers at your NFP who are responsible for your reporting. What happens when they depart from their role and the next person doesn’t know where to pick things up?

Outsourcing your bookkeeping gives you a reliable contact who will never abandon your books. And experts are less likely to make a mistake than a part-time staff member who is already overwhelmed. 

Risks with mismanaged funds are significant for not-for-profits. A missed audit report or improperly lodged taxes can lead to serious penalties and fines. Outsourced bookkeepers are also impartial. They can do an objective risk assessment and tell you honestly where you need better financial safeguards or reporting in place. 

It’s important to keep in mind that financial errors snowball. If you lodge an incorrect 2020 tax return, some of the data on your return for 2021 may also be wrong. A bookkeeper can look over historical documents to make sure you’re not working with erroneous reports. This mitigates your long-term risks as well as correcting your current reports. 

Stay compliant with all relevant filings

Your nonprofit may be responsible for a variety of reporting. An outsourced bookkeeper can help you stay up-to-date on all necessary filings. Reports you may be responsible for include:

  • ACNC statements. If your not-for-profit charity is registered with the ANCN and has an annual revenue of more than $250,000, you must supply them with annual financial statements. The reporting must be sent within six months of the end of your financial year. NFPs who generate less than $250,000 per year still need to send an Annual Information Statement. 
  • Constitutional requirements. Most not-for-profits have a constitution which guides the organisation’s rules and regulations. This often includes how often you need to create financial reports and to whom they need to be supplied. 
  • Local regulator reports. Depending on the state where your nonprofit is located, you may also have to submit financial records to a local regulator. In New South Wales, for instance, you must lodge a Summary of Financial Affairs with NSW Fair Trading. The statement must be submitted within one month of your annual general meeting, or within seven months of the end of your fiscal year.
  • Audits. Many not-for-profits are also required to lodge a full audit of their finances to a local entity. In Queensland, your financial statements must be audited by a registered company auditor. 
  • Reviews. Some small nonprofits may not be required to submit to a full audit, but rather a review. Think of this process as Audit Lite. A certified member of the Chartered Accountants Australia and New Zealand, CPA Australia, or the Institute of Public Accountants will go over your financial statements to test for accuracy and completeness.

The intricacies of a nonprofit’s financial reporting are evolving and complicated. It’s a lot for your staff to handle when they are also tackling other responsibilities. An outsourced bookkeeper who knows a lot about your not-for-profit industry will stay current with your organisation’s legal requirements. 

Take advantage of experience and top accounting software

A not-for-profit organisation may not have access to the latest accounting software. It’s understandable for you to spend your precious resources elsewhere. But what happens when the tax codes change or your state alters the required reporting? You may be lost. 

A dedicated, outsourced bookkeeper has not only the expertise to understand the needs of a not-for-profit, but also has the newest version of important accounting software. The top accounting tools can make it easier to create and send everything from a balance sheet to accounts payable reports. With an outsourced professional at the helm, your NFP can tap into the newest ways to expedite financial reports and catch mistakes. 

Is outsourced bookkeeping right for your organisation?

Is your not-for-profit growing? It may be time to turn over your books to a professional. An outsourced bookkeeper can do everything from record your donations to lodge your annual reviews and audits. You will be kept informed every step of the way without having to put in your own elbow grease. 

To find out how bookkeeping professionals can make your organisation run more smoothly, learn about how Visory’s bookkeeping service can help your nonprofit.

Are Bookkeeping Fees Tax Deductible?

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It costs a lot of money to run a business. Thankfully, many of your organisation’s essential expenses can be deducted from your tax returns. Deductions lower your tax liability and can help keep your books in the black. 

What can be deducted on your tax returns? This is the million dollar question. 

Businesses can deduct a variety of regular business costs. This includes many of the vendors you use to keep your operation running. Electricity, land taxes, and even your bookkeeping costs can be claimed when you lodge your year-end taxes. 

Can you deduct bookkeeping fees from your taxes?

Are bookkeeping fees tax deductible? The short answer is yes. The Australian Taxation Office (ATO) allows you to deduct certain bookkeeping fees from business taxes. If you hire an outside vendor to handle your tax preparation and reporting, the expenses are eligible for deduction as long as they meet the three golden rules of the ATO. 

All business deductions must meet the following criteria:

  1. The expense must have been related to your business. If you use a bookkeeper for personal expenses, the fees can’t be deducted on your taxes. 
  2. Expenses that are both business and personal must be appropriately divided. In other words: If you use the same bookkeeper for both business and personal use, you can only deduct the portion of the fees that relate to your business accounting. 
  3. You must provide supporting documents. Be prepared to show the ATO exactly what you paid in bookkeeping fees related to lodging your taxes.

Which bookkeeping fees are eligible for deductions?

The Australian government specifically states: “You can claim a deduction for expenses you incur in managing your own tax affairs, such as the cost to lodge through a registered agent.” The fees and expenses that you might incur include anything you spend on tax reference materials, tax return preparation courses, tax agent costs for lodging your return, costs related to tax advice from a registered agent, tax return software, and any fees associated with negotiating your tax affairs with the government. 

You can also deduct any travel expenses associated with getting your taxes done. Your tax interest charges are also deductible, as are credit and debit card fees you incur when you pay taxes using a card. 

Australia also allows you to deduct some salary and wages from your business taxes. In many cases, the wages paid to a contractor (like a regular bookkeeper) who completes a service are tax deductible. Payroll tax considerations and deduction laws may depend on the state where your business is located. 

How much do bookkeeping services cost?

Bookkeeping fees depend on a variety of factors. These can include:

  • The experience of your bookkeeper. A bookkeeper who is well versed in your particular industry will likely charge more than someone who is just starting out. 
  • The needs of your organisation. If you want complex reporting and insights, you can expect to pay more for a bookkeeper than if you use outside help for payroll and basic record keeping.  
  • The nature of your relationship with the bookkeeper. If you hire someone full-time, you are responsible for annual and sick leave and superannuation. These costs add up. Contractors may charge more per hour, but you are not responsible for benefits. 
  • Where you live. Some states have higher average per-hour rates for bookkeepers than others. If you’re sourcing someone from a major city, you may pay them more. 

All of this being said, there are some average figures to keep in mind. According to the Institute of Certified Bookkeepers, a contract bookkeeper in Australia usually charges at least $55 per hour to make the equivalent of a salary plus benefits. 

Not all bookkeepers charge per hour. You may also choose to pay per project or service. With Visory, for instance, you are charged based on the services and outcomes you require. This allows you to enjoy consistent charges and a personalised bill. You can learn more about Visory’s pricing if you prefer project pricing versus hourly costs. 

What exactly is a tax deduction?

A tax deduction reduces your business’ taxable income. In turn, this mitigates your tax liability to the government. More specifically, deductions are business expenses you incurred during the tax year that can be applied against your tax burden. By deducting things like travel to see your tax accountant or bookkeeper’s fees from your total income, you can reduce your tax bill at the end of the year. 

You can deduct many business operating expenses related to payroll, retirement funds, and accounting software expenses.  Be sure to comply with requirements related to deductions before you try to apply them. For instance, to deduct regular employee wages, you typically have to comply with PAYGW (pay as you go withholding) and reporting. If you don’t meet the requirements, you will end up paying more than you expected, including potential penalties. 

How bookkeeping can help you stay on top of deductions

Asking “Are bookkeeping fees tax deductible?” is just the tip of the iceberg. You should also ask “How can my bookkeeper maximise all my deductions?”  Your bookkeeper can not only identify the deductions that mitigate their own fees, but also seek out creative ways to earn credits and deductions for other expenses. 

A good bookkeeper can:

  • Stay on top of changing tax laws. New deductions could save you thousands but only if your bookkeeper knows which new deductions and credits are available for businesses this year. 
  • File on time. You can lose a lot of money in penalties and fees for filing late or improperly. An experienced bookkeeper is working on taxes well in advance so they are never lodged late. 
  • Have all necessary records on hand. You need proof such as receipts and invoices to get approved for many deductions. A bookkeeper will collect these throughout the year and have them organised come tax time. 

Are you ready to get some help with taxes? Visory can do that and so much more. Connect with us about bookkeeping tax deductions, payroll help, and other financial services to see how you can minimise your tax liability next year.

How Bookkeeping Services Can Help Your Medical Practice

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Doctors and other privatised medical professionals have a lot on their plate already. So why add doing taxes to the list? If you’re running a medical office, you need a bookkeeper on hand. Whether you have someone on staff full-time or you use a contractor to fill in as needed, bookkeeping services for doctors are crucial to managing revenue and staying compliant with government regulations.

If you’re currently asking your front desk staff to handle the books, keep reading. Let’s talk about how a dedicated bookkeeping service for a medical practice can be a game changer.

What is the purpose of bookkeeping in a medical practice?

The benefits of bookkeeping in the medical office can’t be overstated. In order to continue offering the best possible care for patients, your practice must be able to afford top equipment and a full staff. And that’s not easy to do if you’re financially underwater.

Any financial adviser would recommend that you keep your books in order. Having a reliable bookkeeper helps your medical practice:

Improve Your Revenue Cycle Management

Tracking your revenue per hour is crucial for any practice. When you know who and what is bringing in the revenue, you can maximise your practice’s profits. For example: you may realise that you make the most money during midday hours. This piece of knowledge will allow you to schedule staff accordingly to have ample appointments available during your most profitable hours.

A bookkeeper can also figure out which practitioners are bringing in the most revenue in your practice. Access to granular information like revenue per hour by practitioner allows you to identify the source of money troubles. How can you improve the revenue for doctors with lower-than-average billables? Compare what they’re doing to the highest billing doctors to see if there are obvious differences. 

Better revenue management requires better revenue analysis. A bookkeeper can break down your revenue in creative ways and allow you to make more informed decisions for your practice. 

Outsource Your Payroll Process

On top of tracking your accounts receivable from patients, handling overhead bills like utilities, and ordering supplies, you also need to keep your people paid. A bookkeeper can also take over your payroll process. For every 25 employees your practice has, you will spend about 100 hours per year manually managing payroll. That’s a lot of time not spent interacting with patients. 

Could your front desk staff have more time for patient follow up if they weren’t also processing payroll? Consider outsourcing your entire payroll operation to a trusted bookkeeper to free up your staff to better serve your patients. 

Streamline Your Accounts Receivable and Accounts Payable

Essential bookkeeping for medical practices also includes tackling everyday cash flow. You need a bookkeeping expert to track every bill you pay (accounts payable) and every incoming payment (accounts receivable). This type of tracking lets you create accurate balance sheets and have every receipt necessary on hand to lodge your taxes properly. 

A bookkeeper will know how to code, record, and analyse your accounts receivable and accounts payable. They can even create regular reporting with notes. You’ll learn if you’re overpaying for medical supplies, which patients still haven’t paid, and other important information. 

Identify New Opportunities Using Financial Reports

A good bookkeeper can balance your books. A great bookkeeper will also offer meaningful suggestions. Medical practices should be looking for ways to grow and evolve. Industry-specific bookkeepers will be able to suggest opportunities for growth, such as adding new services or renting out patient rooms to holistic health practitioners. You want to scale up at a responsible pace, not a break-neck speed that will lead to failure. 

How bookkeeping services can improve your medical billing process

Unpaid medical bills can quickly spell trouble for your medical practice. A bookkeeper can streamline your billing processes to create a better accounts receivable record. Your bookkeeping service may institute improved policies like:

  • Automatic follow-up for unpaid bills. Are you contacting patients on a routine basis if they have a balance with your practice? A good medical billing process will send out automatic reminders to patients who need to pay their bill. 
  • Better payment processes. Increasing the number of payment methods can increase the chances that you will be paid promptly. Your bookkeeper will be able to set up new credit card and online payment systems that are easy for patients and great for cash flow. 
  • Coordinate with medical billers. If you’re one of the many Australian medical practices who work with an approved medical biller, a bookkeeper can work with your biller as needed. Using an outside medical biller can free up a part-time bookkeeper to focus on your other internal financial needs. 

Bookkeepers can improve your medical business’ financial health

Keeping track of bookkeeping in the medical office is not a job for someone without financial expertise. Even a medical practice with a small staff should consider outside help to manage billables and brainstorm new revenue streams. Bookkeepers can improve overall financial health in several ways.

  1. Getting paid on time improves your cash flow. A bookkeeper who makes sure you get paid is going to immediately improve your financial picture. 
  2. Looking for unnecessary spending can eliminate waste. An experienced bookkeeper may be able to spot redundancies in your spending or identify high-cost expenditures with a more affordable alternative. For instance, you may be able to bundle telecommunication services to bring down your overhead costs. 
  3. Breaking down revenue can reveal successes. Smart bookkeeping isn’t just about eliminating bad spending. It’s also important to spot areas where you are succeeding. If you have a particular service or set of operating hours that bring in the most success, you’ll want to make sure you’re prepared to grow those parts of your practice. 
  4. Changing bookkeeping methods helps you grow. Small operations may begin with a cash method. This means you’ll count cash as it enters your bank account. Larger practices may want to switch to accrual accounting, which is when you count revenue once the service is complete. Switching to an accrual method allows you to better forecast the short and medium-term financial future of your practice. 
  5. If you need help with medical billing and healthcare bookkeeping, consider calling in industry experts. Visory can connect you with a team of healthcare bookkeepers who know how to manage patient billing, payroll, and more with confidentiality in mind.