Virtual accounting and bookkeeping services are gaining popularity with every technological advancement and revolution in information technology. More companies are opting for virtual accounting and bookkeeping services.
What is virtual accounting?
Virtual accountants can remotely access financial transactions from businesses. Virtual accountants have access to the servers and software used to record financial transactions. Businesses can provide this information to virtual accountants remotely. This data will be accessible to the accountant who will analyze it and prepare financial reports.
New businesses and small businesses often have limited funds. Traditional accounting services may be too costly for them. Virtual accounting services are not only less expensive but also more convenient, as they assist your business with key tasks such as payroll and preparing financial statements.
What can virtual accounting services do for your business?
Virtual accountants perform a lot of virtual accounting/bookkeeping functions. These include-
Payroll- This is the compensation businesses pay employees in exchange for their services. Virtual accountants can calculate payroll, after taking into account deductions, adjustments, taxes, and other policies.
Virtual accountants can manage accounts payable and receivables for businesses.
Accounting ledger maintenance – Virtual accountants create general ledgers. These ledgers can then be used to create financial reports or for analysis by chartered accountants.
Prepare invoices – Many accounting firms offer services to prepare invoices for payment due to businesses. They can send invoices or make collection calls for the business.
Preparing financial statements Virtual accountants prepare and verify financial statements in accordance with company policies, relevant laws, and regulations.
Evaluating financial operations – Virtual accountants evaluate financial operations, give guidance on revenue enhancement, and profit maximization, and assess risk.
The benefits of virtual accounting services
- Compliance with laws and regulations – All businesses must follow the law while operating their business. These laws must be followed by businesses. If they don’t, they can face heavy fines or even criminal charges. Compliance with the laws and regulations in accounting is essential for tax preparation and payroll preparation.
This can be a time-consuming task that requires expert knowledge. Because they are compliant with the laws of the land, it is a benefit for businesses to use virtual accounting services for financial records, statements, and reports.
- It is efficient and easy to use virtual accounting services because all data is stored on one server or software. This makes reporting easier, reduces paperwork, and allows the accounting services to have access to past tax returns and financial reports.
- It is not cost-effective to hire an in-house accountant or team of accounting professionals. An in-house accountant can be costly. You have to pay their salaries, insurance, and benefits. You will pay them an agreed-upon sum for virtual accounting services.
Virtual accounting is cost-effective for small businesses because they don’t require the company to purchase expensive software or train staff.
- Access to financial records – Both the business and virtual accounts have access to the financial records anywhere they are located. All financial records can be accessed by anyone who has access to the cloud server.
- Virtual accounting services are more impartial than traditional accounting. There is less chance of fraudulent or biased accounting when you use virtual accounting services. Because a remote bookkeeper has less interest in the company’s affairs, this is why it is so popular.
- Customer support services – Virtual accounting services offer round-the-clock support to their clients. Virtual accounting services often have well-trained customer support representatives who are available via chat, phone, or email to answer any questions.
- It is time-efficient – Traditional bookkeeping and accounting services can be expensive so many small business owners make it their responsibility to record all financial transactions. Accounting can be a tedious task that requires expert knowledge. This also means that the business owner is distracted from more important matters.
Businesses can also save time and money by using virtual accounting, which is much cheaper than traditional accounting services.