The Actual Return on Investment (ROI) of Hiring a Professional Bookkeeper vs. Hiring an Employee

Do you know the cost of bookkeeping in Chesterfield VA?  Let’s walk through some thoughts on how to objectively look at the situation and assess the return on investment that outsourcing your accounting/bookkeeping provides. So, how much does bookkeeping cost for most small businesses assuming you need only six hours of bookkeeping per month?

Hiring a Bookkeeper/Accountant:

Cost:

  • Most bookkeeping firms charge $40-$90 per hour
  • Average cost of bookkeeping in Chesterfield VA is between $240-$540 per month based on 6 hours per month of bookkeeping services

Pros:

  • The bookkeeping firm will have a vested interest in doing a good job for that is their livelihood and they will not want to jeopardize it.
  • You will have easy access to your financial records to give you up-to-date insight into the financial viability of your business venture at the touch of your fingertips.
  • They provide quality assurance and accuracy.
  • They are certified in the bookkeeping software and can resolve any issues that may come up in the software.
  • Having accurate and up-to-date books will cut down the time it will take a tax accountant/CPA/Enrolled Agent to do your taxes which will you save you money, time, and stress at tax time.
  • They can provide expert financial/business advice to help in the profitability of your business.

Cons:

  • May cost a little more than hiring an employee or it may not; however, with the lower cost, comes greater risks as mentioned below.

Hiring “Someone on the Side” or Using the Office Admin to Do the Bookkeeping:

Cost:

  • Most employers pay their bookkeeping employees an average of $15-$35 per hour
  • Average cost is between $90-$210 per month based on 6 hours per month of dedicated bookkeeping; however, you will need to take into account that you will be paying additional costs for payroll and unemployment taxes, worker’s compensation, benefits, office equipment, cost of hiring, etc.

Pros:

  • May be less expensive or may cost the same or more depending on what other employee costs you would have.

Cons:

  • How long will the person stay in the position? If not very long, your costs will be greater because you will then have to advertise or pay a temporary service in order to find another employee. You would also have some amount of training for the new employee which costs time which costs additional funds.
  • How would you validate their credentials and accuracy of their bookkeeping skills? Perhaps this is just a side gig for them and maybe they “just don’t know what they don’t know.” Mistakes could cost a lot of money down the road.
  • Will they just be a “Yes Man (or Woman)” and not give the business owner good accounting advice?
  • Do they have the commitment to help your business succeed for the long-haul on your road ahead?
  • It is a known fact that most fraud in small businesses is done by the “internal” office manager/bookkeeper/family member of the business owner. The more “hats” the internal employee doing the books “wears,” the more likely it is for fraud not to be detected until it is too late and the business experiences a financial setback that it may not be able to recover from.