Among the many decisions that business owners face on a day to day basis, determining the way they manage their business financials is crucial to the long-term success of their business.
One of the most common decisions our clients make is choosing between Bench or their CPA’s in-house bookkeeping services. To help you determine the best option for your business, we’ve rounded up the ins and outs of both here:
Working with Bench
Bench gives your business a team of in-house bookkeepers who handle the bookkeeping, and an intuitive app to track your finances.
Bench saves your business time and delivers accurate monthly financials at an affordable price. With Bench, communication is unlimited. Your dedicated bookkeeping team will get to know your business closely and answer all your questions within one business day.
We work with small to medium size businesses from a wide range of industries that are comfortable with the modified cash basis approach. We do your monthly bookkeeping by using our proprietary software, and prepare your financial statements in app.
At the year end, we compile all your financials into a Year End Financial Package which can be used for tax planning and filing. For tax filing, you can use either Bench Tax or we can coordinate with your CPA. We’ll send them everything they need to file for your smoothest tax season yet.
Working with a CPA
An in-house CPA can be a trusted accredited advisor equipped with deep accounting technical information.
Some individuals prefer working with local CPAs where face-to-face interaction is possible. This way, business owners can establish a very close relationship with their CPAs. They may even be involved in the company’s operations, such as inventory tracking.
With the knowledge CPAs gain through experience and their accreditation, they may be able to provide a wide range of services to act as an all-in-one controller for businesses. Although this all-in-one solution is attractive for many business owners, it comes at a premium price ($1000 - $5000 on average across the US per year).
At the source of all business financial services is bookkeeping. In order to do the tax filing and preparation as well as advisory services, CPAs need the bookkeeping to be completed.
Depending on the firm, a CPA may offer bookkeeping services where they do the bookkeeping themselves, have in-house bookkeepers, or outsource the bookkeeping to a third party. In-house bookkeeping solutions give CPAs complete control over the bookkeeping, whereas third parties may help ease the bookkeeping workload and let them focus on their higher-value services, especially during tax season.
Working with a CPA for both bookkeeping and tax filing may allow more room for customization. The CPA can create different charts of accounts as needed, as well as custom reports in platforms such as QBO and Xero. The frequency of the bookkeeping can also be customized depending on the business needs (monthly, quarterly, or annual).
What option is best for me?
The numerous amount of choices in accounting services may be overwhelming to new entrepreneurs. Similar to running a business, there is no universally sound option. Rather, different options work for different needs.
When tackling your finances you should consider three important aspects of your business: the size and complexity of your business, and your budget. This will help determine what services are available to you and the depth of services you will require. Remember, the larger and more complex the books get, the more services you’ll likely need to keep your finances in order.
Upon its inception, Bench was intended to be an affordable online bookkeeping solution for small to medium sized businesses. Through the development of financial technology and a unique business model, Bench has become highly effective at managing monthly cash basis accounting. The simplicity and efficiency gives business owners access to an affordable financial service that meets their needs.
Although Bench is great for small business owners, it may not be able to meet the needs of larger and more complex companies. As corporations grow they will likely adopt different accounting approaches. They may operate under accrual (GAAP) practices, which most CPAs are well familiar with. CPAs may also be able to provide additional financial services such as advisory, tax planning, or projections. Due to the wider range of services, deeper knowledge, and often continuous involvement in their clients’ businesses, these services will come at premium prices.
As the accounting industry progresses through advancements in technology, the services that are available to business owners are becoming more automated, real-time/online, and affordable. Platforms such as Quickbooks and Xero have emerged to become powerful tools for financial professionals to handle accounting extremely efficiently. Others like Bench, have gone further in an attempt to revolutionize the way traditional bookkeeping and taxes are done.
Consequently, many business owners and professionals have quickly adapted to the changing world and utilize a variety of services. More and more entrepreneurs are using Bench in tandem with their CPAs to get the best of both worlds—while keeping it as pocket-friendly as possible.
With the peace of mind you get having your financials taken care off, you can focus on what you’re good at—growing your business!