Should Hire an Accounting Firm Instead of Freelancers

You Should Hire an Accounting Firm over Freelancers Philippines is one of the best countries in the world to outsource your accounting and bookkeeping services because the talents are hardworking, dedicated, trustworthy and loyal professionals. However, in outsourcing your services for a long term and sustainable support it is recommended to contract with the accounting firms instead 0f the freelancers. 8 Practical Reasons why you should contract an accounting firm over the freelancers in the Philippines 1 Expertise and specialization Accounting firms often have a team of professionals with diverse expertise and specialized knowledge in different areas of accounting. This means that you can access a wider range of skills and experience compared to a single freelancer who may have limitations in certain areas. 2 Scalability and capacity Accounting firms typically have the resources to handle multiple clients simultaneously. They can easily scale their operations and allocate more staff to your project if needed. This flexibility is particularly valuable for businesses with changing needs or growth aspirations. 3 Guaranteed availability of support Working with an accounting firm ensures that your financial records and processes are not dependent on a single individual. If a freelancer becomes unavailable due to illness, vacation, or other circumstances, it can disrupt your accounting operations. In contrast, accounting firms can provide backup and ensure continuity of service. 4 Quality control and peer review Accounting firms often have established quality control processes and procedures in place. They enforce strict standards to maintain accuracy, consistency, and compliance. Additionally, the work of individual accountants within the firm can be reviewed by their peers, minimizing the risk of errors or omissions. 5 Compliant with GAAP Accounting firms are managed by highly competent professionals and mostly are Certified Public Accountants (CPA). Hence, it follows their understanding of full accounting cycles following the Generally Accepted Accounting Principles (GAAP) locally and internationally. Freelancers, especially none accountants may not have this proficiency. 6 Infrastructure and technology Accounting firms generally have access to advanced accounting software, tools, and infrastructure to streamline their processes. They can leverage technology to improve efficiency, accuracy, and data security. Furthermore, some have equipped themselves with power supplies and internet connection for service continuity in times of natural calamities. Freelancers may not always have the same level of technological and viable resources at their disposal. 7 Diverse Services on Accounting and Bookkeeping Accounting firms often offer a broader range of services beyond basic bookkeeping, such as tax planning, financial analysis, budgeting, and forecasting. They can provide comprehensive financial insights and advice tailored to your specific business needs. 8 Reputation and accountability Established accounting firms often have a reputation to uphold and are more likely to prioritize customer satisfaction. They are accountable for their work and have a vested interest in maintaining long-term client relationships. While freelancers can also be reliable, accounting firms generally have a stronger track record and more established brand presence. For the above practical reasons, it’s important to note that these points may not apply universally to all accounting firms and freelancers in the Philippines. Each case should be evaluated based on the specific needs of your business and the capabilities and reputation of the professionals or firms you are considering. LOOKING FOR A PROFESSIONAL BOOKKEEPER? Connect with us and get your FREE Quote Contact Us

The 5 Very Common Bookkeeping Mistakes and How To Avoid Them

The 5 Very Common Bookkeeping Mistakes and How To Avoid Them Bookkeeping is an essential aspect of every business, big or small. It involves recording all financial transactions accurately and systematically. However, even the most experienced bookkeepers can make mistakes that can have serious consequences for the business. Read the following common mistakes and how to avoid it. 1 Failure To Keep Accurate Records Problem: This is one of the most common bookkeeping mistakes. It’s essential to keep all financial records, including receipts, invoices, and bank statements, organized and up-to-date. Not keeping accurate records can lead to financial discrepancies and potential legal issues. Solution: Use accounting software like QuickBooks to automate the process and make it easier to keep accurate records. Otherwise, outsource to a professional bookkeeper or bookkeeping firm to the job. Check Bookkeeping Accountant and seek help. 2 Misclassifying expenses Problem: Misclassifying expenses is a common bookkeeping error that can lead to inaccurate financial statements. For instance, classifying a capital expenditure as an operating expense can result in an overstatement of the business’s profitability. Solution: Ensure that expenses are accurately classified to avoid any errors. 3 Not tracking expenses regularly Problem: It’s essential to track expenses regularly to have a clear picture of the business’s financial health. Failing to do so can result in missed opportunities to save money or make informed financial decisions. Solution: Implement a system for tracking expenses regularly to avoid this mistake. 4 No Back Up Data Plan Problem: Failure to back up financial data is another common bookkeeping mistake. Data loss can happen due to system failure, cyber-attacks, or natural disasters. Solution: Back up financial data regularly to avoid potential data loss. It is recommended to have the files save in a cloud system with security features for data protection. 5 Unreconciled bank statements and the potential consequences Problem: Failing to reconcile bank statements with accounting records is another common bookkeeping mistake. Reconciliation involves checking that all transactions recorded in the accounting system match those on the bank statement. Therefore, unreconciled bank statements can lead to a range of negative consequences, including financial loss, inaccuracies in financial reporting, and damage to your reputation. It is important to reconcile your bank statements regularly to ensure the accuracy of your financial recordsPotential Problems and Risks of an Unreconciled Bank Statements ⦁ Overdraft FeesIf there are outstanding transactions that have not been recorded in your books, you may not have an accurate picture of your cash balance. This can lead to overdrafts, which can result in overdraft fees from your bank.⦁ Inaccurate Financial StatementsFailure to reconcile your bank statements can lead to inaccuracies in your financial statements. This can make it difficult to make informed financial decisions and can lead to errors in tax reporting.⦁ Fraud and Errors If you don’t reconcile your bank statements, you may not catch fraudulent transactions or errors in your bank records. This can lead to financial loss and can also make it difficult to identify and correct problems. ⦁ Loss of CredibilityIf your financial records are not accurate, it can damage your reputation with investors, lenders, and other stakeholders. This can make it harder to secure financing or attract new business.⦁ Difficulty in AuditingFailure to reconcile your bank statements can make it difficult to audit your financial records. This can lead to additional audit fees and can also make it harder to demonstrate compliance with regulatory requirements. Solution: It’s essential to reconcile bank statements regularly to identify and correct errors early on. It’s better to perform weekly or monthly reconciliation otherwise. LOOKING FOR A PROFESSIONAL BOOKKEEPER? Connect with us and get your FREE Quote Contact Us