Why Every Growing Business Needs a Bookkeeper

If you’re at the helm of a growing business, chances are keeping track of your finances is getting much more difficult. While many entrepreneurs start off by handling their accounting themselves, there comes a point when a scaling business needs a professional bookkeeper.

At its core, bookkeeping creates order from chaos. In fact, cash control forms the foundation of sound business finances. “One of the main reasons you go into business is to generate cash. Whether it’s to pay it out, or reinvest it to grow your business,” says Danielle Angle, Treasury Management Officer at First Utah Bank. “When you lose track of your cash flow, you’re essentially losing track of your business.”

3 Ways Professional Bookkeepers Save Growing Businesses Money

Professional bookkeepers bring organization to your cash flow management, and what they do goes far beyond basic data entry. They establish processes that ensure accuracy, compliance and meaningful financial insights, creating a foundation upon which you can make strategic business decisions.

1. Discover Which Parts of Your Business Are Actually Losing Money

Have you ever thought a part of your business was doing great, only to discover it was actually losing money? This happens more often than you might think. Without proper financial tracking, it’s surprisingly easy to unknowingly subsidize one area of your business with another.

It’s common for business owners to operate on what they see in their bank accounts – if there’s money there, things must be good, right? Not necessarily. Commingling funds between different parts of your business can create a mirage of profitability. You might think your new product line or service is thriving when it’s actually draining resources from your core business.

Proper bookkeeping pulls back the curtain on what’s really going on in your accounts. By accurately tracking income and expenses for each part of your business, you can see exactly which elements are truly profitable and which are costing you money. This clear financial picture gives you the information you need to make decisions about where to invest your time and resources.

2. Stop Fraudulent Charges Before They Drain Your Business Account

Without someone regularly checking your accounts, you’re basically leaving your financial doors unlocked. Many business owners don’t realize how vulnerable their accounts can be once their banking information enters circulation.

“All it takes is the wrong person getting a hold of your account and routing number, and suddenly, they’re paying their bills with your hard-earned money,” says Angle.

Your routing and account numbers aren’t as protected as you might think. Without regular reconciliation of your accounts, fraudulent charges can continue for months before detection. By then, recovering your money becomes extremely difficult.

For businesses, the window to dispute fraudulent ACH transactions can be as short as 24 hours. After that, the transactions have aged, the trail has gone cold, and you’re often left with little recourse. By reconciling transactions promptly, professional bookkeepers spot unauthorized activity before it becomes a sustained drain on your resources.

3. Eliminate Duplicate Payments and Missed Billing Opportunities

Bookkeepers don’t just record what happened in the past – they help build better systems for the future. Beyond tracking transactions, skilled bookkeepers analyze your financial workflows and identify problematic patterns and inefficiencies.

Many companies face issues like duplicate payments, missed billing opportunities, and procedural gaps. These kinds of problems can create financial leakage that grows over time, and they happen more often than you might think. Temporary workarounds can quickly turn into permanent fixtures, and before you know it you’re wrestling with outdated systems that no longer work.

An accountant can bring fresh eyes to these processes, implementing streamlined systems that prevent errors before they happen. They bring a proactive approach that can transform your financial operations from reactive damage control to preventative care, which in turn saves time, reduces stress and maintains your bottom line.

How To Know When Your Business Has Outgrown DIY Bookkeeping

So, how do you know when it’s time to bring in a professional bookkeeper? Think about your time as your most valuable asset. When you find yourself spending hours on bookkeeping instead of tasks that directly grow your business, you might need to delegate your accounting to an expert.

The type of business you run matters too. If you’re selling services like consulting or legal advice, your accounting needs are relatively straightforward. But if you’re dealing with inventory, manufacturing or multiple business locations, your financial tracking gets complicated fast.

How Professional Bookkeeping Pays for Itself (And Saves You Money)

One of the reasons business owners put off hiring a bookkeeper is because they see it as an unnecessary expense. But that’s like viewing an oil change as an unnecessary car expense – skip it, and you’ll end up with much bigger problems down the road.

Good bookkeeping actually pays for itself with:

• Lower tax preparation costs. When your records are organized year-round, your accountant doesn’t have to spend lengthy hours sorting through receipts and bank statements. Many business owners are shocked to discover how much they’ve been paying their CPA to essentially do basic bookkeeping work during tax season.
• Better business financing options. Financial institutions base their lending decisions on the perceived risk of your business. Disorganized or late financial reporting gives lenders a negative impression of your company, resulting in higher interest rates or even denied financing. Consistent, accurate bookkeeping demonstrates your company’s financial discipline, and it typically translates into more favorable loan terms.
• More time for money-making activities. Those hours you’re spending on your accounts could be used to land new clients, develop new products, or improve customer relationships. When calculating the cost of bookkeeping services, don’t forget to factor in the value of your reclaimed time.
• Discovering profit losses. Proper accounting often reveals which products or services are actually costing you money (rather than making it). These insights allow you to refocus resources on your best money-making ideas, which could potentially transform your business performance.

Focus on Growing Your Business While Experts Handle Your Books

Perhaps the best reason to hire a bookkeeper is simply that most entrepreneurs aren’t wired to enjoy financial record-keeping. Different personality types gravitate toward different aspects of the business. Those traits that make excellent entrepreneurs – creativity, big-picture thinking, comfort with risk – often differ from those that make a meticulous bookkeeper, such as attention to detail, methodical thinking and pattern recognition.

By bringing in someone who genuinely enjoys creating financial order, you can free yourself up to focus on what you do best. When you build a business that focuses on your strengths, your level of stress decreases, your productivity increases, and your business benefits from specialized expertise in every area, including its financial foundation.