When you've kept your own books since the first invoice, handing them to someone else is hard. Yet, at a certain point, outsourcing becomes a necessity: month-end takes a weekend, receipts pile up in a drawer, and the reports arrive too late to guide a decision. Done well, it gives you current numbers and your evenings back.
Key Takeaways
- Decide which tasks to hand over before you contact anyone: bank reconciliation, bills, invoices, payroll entries and monthly reports.
- Compare three routes: a freelancer, a bookkeeping firm and a remote assistant you hire directly.
- Call two references and give each finalist a sample task.
- Write the scope, the turnaround times, the confidentiality terms and the notice period into the contract.
- Plan the first month: hand over records securely, limit access and check the first two sets of reports against your own numbers.
Benefits of Outsourcing Bookkeeping
Done well, outsourcing gives you a profit and loss statement, a balance sheet and a cash flow statement for each month, ready by a date you agree. It also gives you hours back. An owner who spends a weekend a month on reconciliations (matching your records to the bank statement) and receipts can spend that time with customers instead.
Two benefits that are often claimed need a closer look. Compliance stays with you, because filing deadlines and penalties land on the business, whoever keeps the records. Data security depends on how the bookkeeper works, so ask about personal logins and two-step sign-in before you grant any access.
Assessing Your Bookkeeping Needs
Make a list of every bookkeeping task in your business, whether it happens daily, weekly or monthly. Don't skip anything. It might help to keep a simple log for two weeks, just to be sure nothing is missing. The list usually falls into five groups:
- Cash flow. Invoices you send, bills you pay and the customers who still owe you money.
- Payroll. Employee pay, tax withholding and payroll reports, which carry their own deadlines.
- Software. The accounting system you use and the apps that feed it, such as your bank, card processor and payroll service.
- Taxes. Whether the bookkeeper only keeps records for your tax preparer or also prepares returns. Anyone paid to prepare federal returns needs an IRS preparer tax identification number (PTIN).
- Reporting. The profit and loss statement, balance sheet and cash flow statement you want, and the date you want them.
Researching Reputable Bookkeeping Service Providers
You have three places to look: a freelancer, a bookkeeping firm or a remote assistant you hire directly. A firm brings a team and a process, and its monthly fee covers both. A freelancer can cost less and depends on one person. A remote assistant works for you directly, in your software and under your rules. We recruit those assistants, usually based in South Africa or the Philippines. You pay a one-time $1,997 recruitment fee and then the assistant's monthly salary directly.
Our guide on how to choose an outsourced accounting firm covers what to ask a firm. Whichever route you pick, ask how the person protects your data: personal logins, two-step sign-in and who can see which files.
Evaluating Potential Service Providers
If you want a good result from outsourcing, you need a process you stick to for every candidate. That means:
- Calling two references from clients with a business like yours.
- Setting a paid sample task, such as reconciling one month.
- Asking what happens when the bookkeeper is away or your volume doubles.
- Confirming that the person already works in your accounting software.
Testimonials on a provider's own website are chosen by the provider, so ask for references you can call. Our list of common mistakes in outsourcing accounting is worth a read before you decide.
Negotiating and Signing the Contract
Read the payment structure and the service level agreement (the written targets for turnaround and reply times) line by line. Before you sign, confirm that the contract names the scope of work, the due date of each report, who can access which files, how either side can end the arrangement, and who covers the work when the bookkeeper is away.
If you hire a remote assistant through us, we replace unsuccessful hires in the first 3 months at no extra cost. For typical pricing models, from hourly rates to monthly packages, see our small business bookkeeping outsourcing guide.
Transitioning to the Outsourced Bookkeeping Service
As with any new hire, always write the steps down. Just because a task is obvious to you doesn't mean it will be obvious to a new bookkeeper. Show an example to avoid guesswork.
Once the contract is signed, the first month sets the pattern:
- Hand over the records. Give the bookkeeper last year's financial statements, recent bank and card statements, the list of categories you use, payroll reports and a list of recurring bills. Use the accounting software's upload or a secure shared folder instead of email attachments.
- Set up access. Create a login for the bookkeeper with limited permissions, and write down who approves payments.
- Compare the first reports. Check the cash balance against your bank and the unpaid bills against your own list, and if possible keep your old process running for one month-end close.
- Keep in touch. Hold a short weekly call during the first month, and say what you want changed.
Final Thought
If you are satisfied that your task list is complete, your next step is to book a free 30-minute consultation, detailing the work you want handed over, the software you use and the hours you need covered.