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Do You Need an Accountant or a Bookkeeper?

Posted on by Rob

Do You Need an Accountant or a Bookkeeper

You’re a business owner with a growing organisation. Your product or service is selling well, your team is expanding, but you’re finding the administrative needs of your company are growing even faster. What do you do?

 

As you reach this exciting point in your business’ development, it’s vital that you ensure you have the right support. Poor planning at this junction can lead to the administrative tasks overtaking your other duties, leaving you with little time to develop new products and services and do what originally drove you to found the company. Choosing to outsource some of your financial administrative tasks to an accountant or a bookkeeper can give you back that time, allowing you to give your growing company the attention it deserves. 

 

But which to choose? While it may be clear that you need an accountant or a bookkeeper, how do you know which one is right for you? In this blog, MP Bookkeeping drills down into what separates the two, helping you make an informed choice about your business’ future. 

What’s the difference?

 

While many people use ‘bookkeeper’ and ‘accountant’ interchangeably, they are actually separate roles each with their own utility. Both assist in the preparation of tax returns, the recording of transactions and the creation of documents, but beyond this they differ in some fairly significant ways. 

 

A bookkeeper’s job revolves around the maintenance of the general ledger. This is the master document that records all financial transactions the business participates in – both sales and expenses. Their role also involves the creation of invoices and the completion of payroll – all the minutia that keeps a business running. 

 

On the other hand, an accountant takes a broader view that encompasses the entire business and its future goals. Their role is more analytical, often involving scrutiny of the operational costs of the business to ensure optimum performance at minimal cost. They will also frequently act as an advisor, helping business-owners understand the financial costs and potential repercussions of pursuing certain courses of action. 

 

What’s right for my business? 

 

It’s difficult to conclusively recommend one over the other. While many business-owners appreciate the comprehensive support and advice of a certified practising accountant, others may simply be looking for someone to manage time-consuming but necessary payroll and compliance functions. The decision will largely come down to your own managerial style and preferences. 

 

Regardless of your specific needs, MP Bookkeeping can help. For more than 30 years, we’ve been helping Australian business-owners make the most of their time, giving them more hours in the day to pursue exciting initiatives that could help them grow their business. Whether you’re looking for a comprehensive accountancy service or are simply looking for a reliable and accurate payroll service, we can assist you. 

 

Start a conversation with us today by calling 03 9523 2277 or sending us an email at vicken@mpbookkeepers.com.au. 

5 Bookkeeping Tips for Small Business

Posted on by Rob

 

5 Bookkeeping Tips for Small Business

 

If you’re a small business owner who’s just starting out, there are a million and one things you need to be across. While it can be tempting to see administrative functions like bookkeeping as something that can be put off, it can lead to costly and time-consuming situations. 

 

To help you ensure that your business is in top financial form, we’ve put together this short list of tips for small business owners. Stay on top of your books and your business with the help of MP Bookkeepers. 

 

  1. Know the law 

First things first, understand what you’re required to do. Your bookkeeping requirements are determined by a range of factors including what industry your business operates in, where it’s based, how many people it employs and what kind of employment agreements it’s party to. Even if you’re intent on doing your books yourself, taking the time to work with a professional to gain an overview of your responsibilities under payroll legislation. 

 

  1. Keep your documents in order 

Having a complete paper trail of payments made by and to your business is absolutely essential. Not only does it provide crucial data to help inform business decisions – are we overspending on a certain service, do we need to change product suppliers, do we need more staff, etc – it also helps protect you against legal repercussions. It’s not something business owners like to think about, but should you ever be audited by the Australian Taxation Office it’s vital that you be able to account for every transaction and every dollar spent and received. 

 

  1. Be proactive about putting aside money for taxes

Similarly, you’d be making a mistake not to be constantly preparing for your annual tax return. Always ensuring that you’re allocating the correct percentage of each dollar spent to a separate tax account is absolutely vital. If you are required to pay taxes quarterly, make sure you have a healthy amount in your bank account for when that activity statement or instalment notice arrives. 

 

  1. Make time every day for your finances 

Bookkeeping isn’t something that can be done all at once. Good record-keeping practice – which is the majority of bookkeeping – requires constant, diligent attention, so ensure that you’re making it part of your daily practices. Checking deposits every day and carefully documenting each transaction is key to a smooth time at end of financial year. If your company is growing, stress the importance to new hires of proper reporting as part of workflows. 

 

  1. Budget for major expenses 

When it does come time to buy that new piece of plant or equipment, or to locate to a new and more spacious office, you want to know that you can do it without hurting your bottom line. This takes planning and forethought – every major purchase must be thoroughly costed as part of the decision process and an achievable timeframe set. As part of this process, you’ll be able to figure out how much of your weekly revenue needs to be diverted to this particular purchase. 

For all small business bookkeeping services, speak to the team at MP Bookkeeping. Contact us at our Melbourne offices on 03 9523 2277 or via email at vicken@mpbookkeepers.com.au and we’ll be happy to answer any question you may have.