Bookkeeping and Taxation Services all at the one Firm

When considering hiring the services of a bookkeeper and an accountant, there are many advantages to having them operate from the same firm.  The services they provide are complimentary which gives the benefits of increased support to the business owner, saving them time, and reducing the risk of errors.

COMPLIMENTARY SERVICES:
Bookkeepers and accountants have very different roles when providing financial services to a business, but the functions they perform are closely linked. Bookkeepers handle the day to day activities of a business’s finances: recording transactions, purchases, receipts and payments.  The accountant, conversely, uses these recordings to analyse the overall financial situation for the business.  This includes performing roles like taxation services, audits, financial forecasting and reporting.

These functions are like two sides of one coin. They equally rely on the other to perform their services well to be able to fulfil their own. D’Arcy Becker, chair and professor of accounting at the University of Wisconsin Whitewater Department of Accounting describes their roles,

‘Bookkeeping is designed to generate data about the activities of an organization… Accounting is designed to turn [that] data into information.’1

In his book, Accounting for Dummies, John Tracey expands on these differences saying,

“Accountants look at the big picture… [They] step and back and say, ‘We handle a lot of rebates, we handle a lot of coupons – how should we record these transactions? Do I record just the net amount of the sale or do I record the gross sale amount too?’ Once the accountant decides how to handle these transactions, the bookkeeper carries them out.”2

As they work so closely on the same information, having both services at the one firm ensures that they have a good relationship and communicate well to be able to perform these functions better than if they were operating separately.

 

TIME SAVING:
Having both services at the one firm saves time for everyone.  For the business owner, this is done by being removed as the middle man between the two.  When the services are performed separately, the business owner has to recruit and facilitate the services between the bookkeeper and accountant, whereas if they are at the one firm they can coordinate together themselves.  This in turn makes the accountant and bookkeeper more efficient, being able to converse directly when looking for information, rather than going through the business owner causing delays in communication.

 

BETTER SUPPORT:
One of the advantages of having a bookkeeper and accountant under one umbrella like this is that it provides better support to the business owner.  For example, when a business owner is looking for details on finances and the accountant is not available, the bookkeeper can step in and go through their records, or vice versa.  This means when one is out of the office, on holidays, or unavailable, there is still support available from the other that has access to all the files, transactions and details that are on record.

 

REDUCTION IN ERRORS:
Two eyes are better than one when it comes to finances. The more people working together provides increased checks and better protection against errors.  By having accounting and bookkeeping services at the one firm, a business owner gets this added benefit, as well as the protection that comes from the removal of disconnects in the communication between the two.  Accounting author, Brian Tankersley, describes it as the relationship between a doctor and a nurse.  By having the doctor work directly with the nurse in the same room, the risk of communication breakdown and errors is dramatically reduced.  He describes the working relationship saying,

“The doctor sees you for a short period of time and is involved in big decisions, but the nurse is there, day in and day out, making sure things happen the way they are supposed to… The bookkeeper makes the accountant’s work possible by getting the transactions recorded in the ledgers. The accountant analyzes, adjusts, summarizes, and reports the data in the ledgers.”3

In the medical sphere it is estimated that 25-40% of hospital errors are made from poor handover communication, when there are breakdowns between shifts and doctors and nurses not working together4.  This reflects the importance of having roles that are so closely linked working together under the same roof, like that of an accountant and bookkeeper working at the same firm.

 

These benefits are crucial to promoting the success of any business’s financial dealings.  If you’d like to know more about the benefits you can receive by having your accounting, bookkeeping and taxation services all at the one firm, contact us today.

 

REFERENCES & FURTHER READING:

1 Business News Daily: Accountant vs. Bookkeeper: What Do They Do for a Business?

2 John A. Tracy: Accounting for Dummies 

3 Fundera: Accountants, Bookkeepers, and Why You Need Both 

4 Journal of Public Health Research: Communication in Clinical Handover 

Firm of the Future: Better in Pairs: How Bookkeepers and Accountants Serve Businesses in Canada