Choosing how best to invest your money as a small business owner isn’t always easy, and knowing whether you can save money by just hiring a bookkeeper and not an accountant, may not be immediately apparent.
While both roles are critical for any business, big or small, understanding their areas of expertise and their responsibilities should help determine whether you can manage with one or the other – if your budget is tight – or whether you would benefit more from having both onboard.
This short guide will help you understand the role of bookkeeping services in Miami, and accounting services in Miami:
What does a bookkeeper do?
Responsible for handling a businesses day-to-day financial transactions, bookkeepers record income and expenses, track cashflow, document transactions, maintain general ledgers, and manage invoices. They may also process payroll, keep financial records updated, and reconcile bank statements, all of which provide a sound basis for financial analysis.
They will use accounting software to generate financial reports, helping business owners understand more about where their company’s is going, and where it’s coming from.
Bookkeepers are also responsible for preparing the necessary documentation for accountants, and when it’s time to file taxes, they will organize all financial transactions to minimize errors and ultimately, make things less stressful for business owners.
What does an accountant do?
Building their work on the information provided to them by a bookkeeper, accountants are responsible for providing tax advice, preparing financial statements, and helping with financial planning.
Accountants employed by small businesses, shift their focus to the types of challenges typically faced by smaller organisations, and are used to dealing with cashflow management for seasonal businesses, making the most of limited resources, and other diverse challenges. They also offer tax strategies applicable only to smaller businesses.
Additionally, accountants analyze data and offer insights to aid businesses in growth, and create key financial reports to help businesses understand their performance and areas for improvement.
Aside from all of this, they also help with tax strategies to minimize liability and maximize deductions, and financial forecasting and budgeting; all of which can help business owners save money, and ultimately, make money.
Does your business need a bookkeeper?
If the financial needs of your business are relatively straightforward, then hiring a bookkeeper will help keep you organized and tax-compliant.
Does your business need an accountant?
If you’re finding yourself making significant financial decisions involving such things as investing in new equipment, expanding, or seeking funding from external sources, an accountant could help you make sound decisions based upon accurate financial data and analysis.
They are also essential for helping small businesses manage debt, minimize risk, and grow in a sustainable manner.
Do you need both?
If your business is growing and has more complex financial needs, working with both bookkeepers and accountants in Coral Springs is likely a smart move for the future of the business. Having guidance and support from both professionals ensures that no stone is left unturned when it comes to the financial health and longevity of your business, and most who hire both, find it to have been a wise investment.
While bookkeepers organize your financial records and make sure daily transactions are recorded properly, accountants adopt an approach that’s more strategic, with analysis, tax compliance and guidance for future growth. Armed with the right information, you should be able to make the best choice for your needs.
