Accounting, what is it and why is it so important?
The word accounting evokes certain feelings in every business owner. Sometimes these are positive feelings, but perhaps more often they are negative feelings. But why, really? Accounting is nothing more than processing your financial records. Easy to say, but there’s more to this than meets the eye. For example, it often involves processing or preparing invoices, as well as everything to do with the tax authorities such as filing tax returns. In other words, it’s basically all the (financial) data of your business. It is very important to have your bookkeeping in good order. Apart from the fact that it is mandatory, it can also save you money through tax benefits and it also gives you useful and concrete insights into your business.
Doing bookkeeping yourself
Advantages
One of the biggest advantages to doing your own bookkeeping is that it is cheaper than outsourcing it to an accountant. After all, you don’t have to pay an outside accountant to have it done for you.
Disadvantages
As a beginning entrepreneur, it is understandable that you do not yet know everything and certainly not in the area of bookkeeping. Doing your own bookkeeping then takes quite a lot of time and chances are that you also make quite a few mistakes in the beginning that you have to fix later on. Even though the cost is lower than outsourcing your bookkeeping, this precious time and the mistakes you make can still add quite a bit to your costs. This is because the time you put into bookkeeping can be spent on other work that will take you to higher sales. Moreover, as a novice entrepreneur, you may be forgetting very important deductions. In addition, you may find out later in the year that you would like to outsource your bookkeeping and then you will still incur costs for an external accountant.
Outsourcing
Advantages
Let’s get right to the point; outsourcing your accounting is super nice. It takes a lot of worries and work off your hands. It saves time that you can devote to your business and you can be sure that your bookkeeping is done properly.
Disadvantages
The cost of paying an external accountant can be quite high. This is the biggest disadvantage of outsourcing your bookkeeping. After all, in addition to a bookkeeper, you also pay for the software package. Keep in mind that outsourcing your bookkeeping can easily cost a few hundred euros. Fortunately, we can mitigate this disadvantage a little bit. Schedule a free consultation with one of our tax advisors so we can make a plan that fits for you!
