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Why are accounting and book-keeping firms necessary?

1. What are accounting and bookkeeping services?

2. Differences between accounting and bookkeeping services

3. Advantages of having an accounting and book-keeping services firm

If you are running a business of any type or size, then you have definitely realized the importance of tracking the transactions of your business. This helps the business to ensure the proper flow of accurate financial information so that transparency in business operations is maintained. Efficient tracking of transactions and maintaining clear accounts can be critical to the success of the business, but, at the same time, incorrect calculations/inaccuracies in this work can put the business in financial difficulties.

Businesses realize the importance of keeping financial records accurate and up to date. But, as has been noticed, the owner / top management must put almost all their efforts into ‘creating’ the business and creating opportunities. Naturally, the task of keeping proper records of invoices, paying taxes and other compliance etc. often lags behind because the owners do not get enough time to look at these aspects of the business on a regular basis.

This is where the Alliance Tax Experts who provide accounting services come from. With our knowledge and skills, we are helping the business stay up to date with its financial records and stay on the right side of all compliance and obligations. This allows the business owner to spend more time in the main business activities while ensuring that the accounting book-keeping functions will be handled by experienced professionals.

The difference between Book Keeping and accounting

Some of the important differences between Book Keeping and accounting are mentioned below-

1. Bookkeeping is primarily concerned with the exercise of identifying, recording, measuring, and classifying financial transactions in a business.

Accounting, on the other hand, involves summarizing and communicating financial transactions grouped into a ledger account during the accounting process. This is a basic point when it comes to accounting vs. accounting.

2. The goal of keeping a book is to systematically maintain accurate records of financial transactions.

The purpose of accounting is to assess the financial condition of the organization from time to time and to inform this information to the management.

3. Another important point, when we look at bookkeeping vs. accounts, is that keeping a book does not involve preparing financial statements.

Accounting, on the other hand, involves the preparation of financial statements based on the records obtained from the ledger.

4. The management of the organization cannot make decisions based solely on bookkeeping.

Management can make financial decisions based on information received from the accounting team.

5. Another important difference between bookkeeping and accounting is that the book-keeping phase comes at an early stage and forms the basis for business accounting activities.

Accounting begins with the completion of the point bookkeeping activity.

6. Bookkeeping is somewhat technical and does not always require analytical skills.

In contrast, accounting is somewhat complicated and analytical. Therefore, it requires certain skills.

Advantages of having an accounting bookkeeping services firm

Your business can reap some significant benefits by outsourcing its bookkeeping and accounting activities to the firm providing such services. These are -

1.     Processes can be simplified

By outsourcing your bookkeeping and accounting activities, you can simplify the internal financial process and thereby save a great deal of time and resources. An outsourced firm working in accounting and bookkeeping services will manage all such activities from start to finish and update management as required. This will allow the business owner / top management to spend more time in core business operations that have a direct impact on business growth.

2.     Costs operating costs can be reduced

Hiring an outsourcing accounting book-keeping firm can significantly reduce the operating costs of a business. When you hire staff for your internal bookkeeping and accounting team, you must give them a pay package with basic pay, health insurance, travel allowance and other applicable factors. In addition, you will need to reduce additional costs such as profit sharing, bonuses, desks, computers, and other operational equipment. Hiring an outsourced firm for an accounting bookkeeping service can save you a lot of money. You do not need to spend on the recruitment and training of such manpower. Due to the firm outsourcing each month, you have to take care of the retainer payment.

3.     You can access modern technology without any capital expense

Sometimes, you don't want to spend money on hardware and software products needed for your business accounting activities. You will not have the skills to use the modern technology required to carry out such activities more efficiently. Outsourcing such work to a firm that provides quality accounting and bookkeeping services can make a better world for you in such a situation. You can access the latest accounting software, DBMS and the updated methods followed in this area. You can take advantage of state-of-the-art data security and privacy solutions provided by companies dealing with accounting and bookkeeping services.

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