August 19

0 comments

What to do When You’re Drowning in Bookkeeping Catchup

Bookkeeping can seem like a monumental task looming over your shoulder when you leave it for too long. Sometimes business development or external circumstances can cause you to fall behind in the upkeep. When this happens, it can cause a ripple effect, making it harder and harder to get back on track. All of a sudden, it’s this mountain of work that you just don’t want to tackle.

Recognize When You’re at Your Limit

1. Your books are months behind. Every once in a while, it’s ok to let your books take a backseat. Being a month or two behind isn’t the end of the world. The problem arises once you are further behind than that. Three months or more becomes a massive project. You need to gather the receipts from those months, balance out the expenses, and reconcile the books. Which sounds easy, but is it? That depends on how good you are at keeping your documents organized.

2. You don’t have enough time in the day. More than ever, mental health needs to be emphasized. If you can barely manage to tackle everything you need to do in a day with business development, how can you do anything else? This will lead to being stretched too thin. Which leads to our next point.

3. Other areas of the business are suffering. You can’t be everywhere at once. If your books are falling behind, and you don’t have the time to do it yourself, this will result in shortcomings in other areas. While you struggle to keep everything up to date, you may be noticing that other areas are slipping. Maybe your sales outreach hasn’t been as on track as past months. Or that your team isn’t getting the necessary support from you. These are results that you can’t allow to happen.

If this sounds like you, you have a few options on how to bring that pile of stress back down to a tidy, manageable task.

DIY: the Good, the Bad, and the Ugly

Let’s start with the solution that you’re going to try first; doing it yourself. While this is admirable, this should only be done under certain circumstances. 

  • The other areas of your business are self-sufficient
  • You have a solid bookkeeping background
  • You have an intuitive bookkeeping software to help you – which you know how to use
  • You have someone to peer edit what you have done

What we would like to advise against is going the DIY route when you have little bookkeeping experience. It will end up costing you more to try the DIY, not have it up to par, and then choosing a third-party solution. If you can do it, that’s great. If not, leave it to the professional bookkeeping firms.

The In-House Employee Route

Companies used to hire “all-in-one” positions called a Controller. This mixed in the high-level accounting work with the low-level administrative work. While this was a decent option, employees would often be disgruntled with tasks that were so high-level that they didn’t enjoy doing them or didn’t have the experience. Or they had too high a level of experience and didn’t like doing the clerical work. It is much more prudent to separate these into two positions. One of them being an in-house bookkeeper.

The benefit of this option for your bookkeeping help is that they know your business. It’s not like having a third party bookkeeping service come in and do the monthly work, they get integrated into the company and the goals it’s trying to achieve.

A key factor that we want to make sure you consider, is do you have the budget? You shouldn’t be spending the time and money on finding and onboarding an in-house bookkeeper unless you can sustain the position. So take a look at your current financial situation. 

Furthermore, you need to make sure that you have the capacity to manage the new employee, monitor their work, and oversee the tasks. Peer editing is a crucial part of good bookkeeping. To err is human after all. So even though you have an in-house employee, a certain amount of checking in is important to make sure there are no huge messes to clean up come year-end.

Hiring a Bookkeeping Firm

Finally, let’s talk about hiring a bookkeeping firm to come in and do the work. We find this to be the most versatile option because it takes the best points from In-House and DIY, while leaving out the negatives. Also, there are some great benefits to finding a bookkeeper near you.

• You only have to pay them for the tasks you lay out. Unlike an in-house bookkeeper where you may or may not have the work to fill their days. The bookkeeping firm choice lets you set out a proposal with them, dictating what they will be in charge of, and the payment is allocated accordingly. This also means you don’t have to do as much monitoring of their work, freeing up time in your day.

• They have a professional background. When choosing your bookkeeping firm, they display their credentials so you can see how apt they are at what they do. Certifications in Quickbooks and Xero are some base requirements that we suggest you look for. We also encourage you to take a look at their testimonials to get a better idea of how they are received by clients.

• You get to pick which firm you want to work with, similar to how you’d pick who you want to hire. But you aren’t paying a full employee salary. You can do as much or as little research as you’d like (or as time permits) to find a great bookkeeping firm for the job.

• This is the best option for internal controls. If you have some bad seeds in the company, this won’t impact the books. They won’t be trying to cover up their mistakes to save face. You get honest, straightforward work back.

• It’s also the best option for investor relations and corporate governance – 3rd party score-keeper

• It’s always good to learn new things. Bringing in a third-party bookkeeper often means they bring their own pre-defined procedures so you don’t have to invent them. They can also recommend accounting and/or fintech software to expedite your process that you may not have known about.

In the end, what we want for you is to have that mountain of work disappear. And we trust that you will make an informed decision on which option best matches your current business situation. If you are looking for a bookkeeper near you, get to know our team. We’d be happy to set up a call and see if our services can benefit you.


Tags


You may also like

Get our Juicy Tips for Business Growth

Delivered to your inbox on a regular basis.