As a small business, you must use your budget in ways that provide the most bang for your buck without breaking the bank. And while many small business owners would love to be able to hire a bookkeeping service and have accountants to do all the work and help protect your business against fraud and embezzlement, it's not always possible.
But does that mean a bookkeeping service can't provide help? No, and here are five ways to still achieve this.
1. Assign Certain Tasks to a Bookkeeper
The biggest risk for embezzlement and fraud by those who work with your books is when they know no one else is looking into the books. Therefore, if you can't outsource all bookkeeping work, break up one or more sections of it and assign it to an outside party. Have them do payroll or handle receivable accounts, for instance, as these carry more potential for fraud.
2. Have an Accountant Do Your Taxes
The preparation of monthly, quarterly, and year-end taxes offer another opportunity to involve an impartial party in your books. Hiring out the tax work allows an accountant to look over all your books, where they can be alert for signs of impropriety. It also ensures that employee misdeeds don't involve some of the most sensitive accounts, such as your tax obligations.
3. Ask for Auditing Services
An audit of your books can select a certain group of transactions to review for accuracy and proper procedure. It can be done randomly or at scheduled intervals and is a one-time project. The auditing party not only looks for signs of wrongdoing and errors, they can also make sure your in-house bookkeeper is following correct GAAP procedures and standards.
4. Use Outside Bookkeeping for Vacations
A common red flag for employee fraud is an employee who never takes time off so that no one sees what they're doing. Insist that all accounting staff uses their vacation days and takes sick days. Then, arrange for an outside service to handle the books while people are on scheduled time off.
5. Learn More About Accounting
By educating yourself as a business owner, you'll know more about what's going on with your money. Work with a professional accountant and/or bookkeeper to learn the basics of business bookkeeping, financial statement analysis, taxes, and GAAP. You'll have more confidence in overseeing your own books and you'll know the right questions to ask.
Where to Start
Could you use outside help with any of these cost-effective services? Then learn more about them by meeting with an accountant who provides small business bookkeeping services in your state today.