So WHEN do you hire a bookkeeper? And WHEN do you hire an accountant? Aren’t they the same?
Entrepreneurs are by their very nature do-it-yourselfers. They tend to wear many hats…webdesign, marketing, branding, answering phones, social media management, appointment setting, providing services, bookkeeping and accounting. And the list goes on. It never stops. Add to the mix that most startups are bootstrapped, meaning that the business owner invests their own money to the venture, outsourcing becomes a harder proposition.
So what do you do when there just aren’t enough hours in the day? When you have doing too much yourself? When you can’t see straight? When you’ve forgotten why you started this business in the first place? You make plans to hire someone… anyone to shoulder some of the never-ending work with you! You hire your first employee or you outsource…
First, you need to determine this – Do you need a bookkeeper or an accountant? Most business owners think that they are the same but they really aren’t. The lines can be a little blurry because most people don’t really make the distinction between the “job titles”. I’m not much for titles but I’m going to help you out and define them anyway.
Simplistically, an accountant is an analyst… they look at the big picture by reviewing your financial statements (profit & loss, balance sheet, cash flow). Whereas, a bookkeeper is your details person…they are your day to day task master. They make sure that deadlines are met, bills are paid on time and customer are paying you. Just a minor difference.
So do you need a bookkeeper or an accountant? The answer is… you need both. It was kind of a trick question. The tasks and skills are different for each job… or hat 🙂
Now that you know you need both, the question remains – When do you hire a bookkeeper? My answer is it depends. As user-friendly as software packages like QuickBooks are, they do take some time to learn. So ultimately, It depends on you. It depends if you are willing and able to learn a new skill and it depends on the time you have available to dedicate to doing the day to day bookkeeping tasks. If you’re not going to learn the software and set aside time to be your business’ financial task master…then the time to hire a bookkeeper is yesterday!
When do you hire an accountant? Here again, it depends. But this time, it depends on how you look at the work of the accountant. For small businesses, an accountant can be somewhat of a coach for the business’ finances. Someone to help you interpret the financial statements and really pull of them what the numbers really mean. This is a skill that takes experience and expertise and not every accountant (or CPA) is accustomed to working with small businesses but having a “money coach” on your team of advisers can help you grow your business faster than going it alone. So depending on your view… the time to hire an accountant, in an advisory capacity… is now.
If you really want to blow your growth projections out of the water. If you really want to build a business. If you really want to work on your business, not in your business. If you really want to get back to what you started your business to do in the first place… you need a team of professionals around you to support you and support the growth of your dream. You need a task master (bookkeeper) and you need a money coach (accountant).
Being a solopreneur doesn’t have to mean going it solo!
Have questions? Have comments? Would love to hear them.