Virtual bookkeeping, also known as cloud accounting and online bookkeeping or cloud bookkeeping, is when an accountant or bookkeeper provides their services remotely to customers.
For example, a virtual bookkeeping service can be offered to clients from anywhere in the U.S.
You can now share an account online with your bookkeeper, upload your financial transactions and update your statements. They can also reconcile your accounts and do other bookkeeping tasks.
What is the working principle of virtual bookkeeping?
Your online bookkeeper will first ask you questions about your business and you to help you understand your needs. They will ask about your company’s history, business structure, and current bookkeeping practices.
After you have fully explained your needs to your bookkeeper, it is time for them to set up tools and apps that allow them to communicate with you and manage your books. You must share the same workflow tools with your virtual bookkeeper in order to work seamlessly. Your bookkeeper may recommend a cloud-based accounting program, such as Quickbooks, Xero , or Xero .
Traditional bookkeeping requires that you mail or hand these documents into your bookkeeper. Virtual bookkeeping allows you to simply take a picture of the receipt and upload it to your accounting software.
Your online bookkeeper is now ready to begin working on your books.
What are the tasks that a virtual bookkeeper can handle?
An online bookkeeper’s main task is to accurately and promptly record all financial transactions.
Although they may not be physically present at the office to perform their duties, there are many other services that they can offer their clients. You can also expect a virtual bookkeeper to perform the following tasks:
- Monthly financial reports (income statement and balance sheet, cash flow statement) are provided to you
Keep an eye on your cash flow - Inform you about any financial problems
- Assist with budgeting, analysis
- Account reconciliation
- The Financial health of your company in full-financial view
- Payroll processing
- Follow-up on invoices and invoicing
- Take care of your tax returns/tax filing
- Catch up on bookkeeping.
What are the benefits of virtual bookkeeping for businesses?
Virtual bookkeeping can be a great way to help your business. Outsourcing your bookkeeping can have other benefits than the ones mentioned above.
Keep up-to-date financial data – In order for a business’s survive, its owners must keep an eye on its numbers. This is difficult if your financial information is outdated or incorrect. Bookkeepers can help you reconcile bank accounts quickly so that you can identify potential problems and avoid costly financial mistakes.
You need to identify where your money is going. A professional bookkeeper can help track your expenses and classify them correctly. You will be able to budget and adjust your spending accordingly by having a better understanding.
Pay the correct taxes and file the right returns – Incorrect bookkeeping can land you on the wrong side with the IRS and could result in heavy fines for your business. A bookkeeper is also familiar with the tax treatment for each expense so that you don’t miss any tax deductions.
Payroll help – As your staff grows, it can become a difficult task to process payroll. This task can be handled by a bookkeeper so that you can focus on other areas of the business.
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These are some things you should remember when searching for virtual bookkeeping services.
Here are some things to keep in mind when you hire virtual bookkeeping services for a company.
Remote services may mean your bookkeeper doesn’t have the same time zone. Ask the bookkeeper if they are available during your working hours, or if they will be willing to work around your schedule.
Expertise in your industry – If you work in construction, you will need a unique type of bookkeeping. Look for bookkeeping companies that are specialized in your business.
Communication is essential for a productive working relationship with your bookkeeper. Do you prefer to communicate via email or video conferencing? Tell your virtual bookkeeper which communication style you prefer.
Access to your accounts – Having 24/7 access to all your records wherever and whenever you are mean that your books can be transferred to the cloud.
Pricing – A low price does not necessarily mean the best option. However, the most expensive service doesn’t always guarantee the best. Consider which virtual bookkeeping service will offer the best value for money. Bookkeeping companies can charge hourly, per project or monthly. Some firms offer customized plans that can be tailored to your specific bookkeeping needs.
Reputation – This is one of the most important factors when selecting an online bookkeeping service. Because they will have access to sensitive information, you want them to be reliable and trustworthy. You can confirm this by looking online at reviews and finding out how long they’ve been in business. Also, check if they have an online presence.
