What Are Bookkeeping Services, Exactly? Let Us Explain

For example, not all services file taxes for nonprofits, so make sure to ask questions and read the fine print before deciding on a company. IgniteSpot offers bookkeeping services that include bill payment and invoicing, plus accounting and CFO services at an additional cost. It didn’t make the list of top online bookkeeping services because it usually only works with companies that have annual revenue of $1,000,000 or more, so it’s not an option for many small businesses. We reviewed multiple accounting software options using a detailed methodology to help you find the 9 best online bookkeeping services for small businesses.

This way you don’t have to rely on the claims they make about what they can do for you. If they are offering advice that others find useful, then you will be able to see that rather than simply taking their word for it. If your prospective virtual bookkeeping service understands the value of adding to the conversation, then it is a good sign that they will be genuinely helpful to your business. All in all, when you sign up for QuickBooks Live, you’ll have access to a certified bookkeeper, as well as a bookkeeping team that can address additional questions. Your bookkeeping team will maintain your books throughout the month and review and close them when the month ends. Additionally, they’ll provide you with a monthly report and be available via phone or video chat to answer questions or walk you through your report.

Compare Bookkeeping Services

Not all online bookkeeping services process invoices, and those that do often limit the number of invoices included with your plan. If you do a lot of invoicing, you’ll need to find a bookkeeping service that can accommodate your invoicing needs, or invest in one of the best invoicing and billing software. Other optional add-on services include payroll coordination, bill pay and financial dashboards.

• If you need other services aside from bookkeeping, such as financial planning, tax advice, and payroll, you should consider Bookkeeper.com.
• Because it’s a Xero Platinum Partner, it’s ideal for small businesses that use Xero bookkeeping software and are looking for more than just a bookkeeping service.
• Many customers state that the QuickBooks Live’s “cleanup” left their books messier than before.
• Allow them to give you the advantage of maximized efficiency of your business income and expenses while holding your employees accountable and minimizing exposure to various financial and audit risks.
• To answer that question, you first need to decide what exactly you need your system to accomplish.
• FreshBooks Premium will cost you $22 per month, and offers unlimited invoicing to unlimited clients, in addition to a host of automation, payment, invoicing, and visualization features.
• This is an expensive time to be running a small business, but there are ways to protect yourself from the effects of inflation.

This is made possible through accounting software that allows you and your bookkeeper to share an account. In this arrangement, the accountant and business must utilize the same accounting software to ensure the proper transfer and communication of files. You should outsource your bookkeeping tasks to a virtual bookkeeper if you don’t have the time for and knowledge of DIY bookkeeping.

Resources for Your Growing Business

At Fundera, Randa specializes in reviewing small business products, software, and services. Randa has written hundreds of reviews across a wide swath of business topics including ecommerce, merchant services, accounting, credit cards, bank accounts, loan products, and payroll and human resources solutions. As part of each of these plans, however, Bench offers professional bookkeepers to get you set up and work on your books. Bench also includes visual reports, a mobile app, automated statement imports, customer support, a dedicated login for your CPA, and tax-ready financial statements. What’s more, Fundera readers can get the first three months for 30% off. Bench offers full-service bookkeeping services for small business—with all of their plans including both a dedicated bookkeeping team and an easy-to-use software system.

You should be able to access a dedicated bookkeeper for any questions or advice and one-on-one assistance. A Live Bookkeeper cannot begin cleaning up your past books until they receive the required supporting documentation, which your bookkeeper will request from you after your first meeting. Once your bookkeeper receives all the necessary documentation, they’ll typically complete your cleanup within 30 days.

Live Bookkeepers you can trust

This means that businesses can monitor their financial performance as it happens – and quickly identify any issues or opportunities for growth. Online bookkeeping services can also automate certain tasks, such as reconciling bank statements, generating financial reports, and tracking expenses. Online bookkeeping services offer several advantages to businesses looking to manage their financial records efficiently.

• A vast majority of the bookkeeping services on our list are large, well established companies, sometimes with the support of millions in venture capital.
• Although the monthly cost of QuickBooks Live may seem high at first glance, it actually falls in-line with many of the other bookkeeping services on this list.
• If you already use or are planning to use QuickBooks Online for your business accounting, then it makes good sense to use QuickBooks Live for your bookkeeping needs.
• With the Premium package, you’ll also get unlimited, year-round tax advisory services, and Bench will file your income taxes for you.
• They don’t mention their initial cleanup fee (which is variable based on the work needed to clean your books) so if your books need significant cleanup, be sure to inquire as to what that will cost before you commit.
• Pricing for revenue-generating companies is customized and starts at $1,500 per month.

Some companies on our list specialize in startups, with strategic cash-burn analysis, Series A-C funding guidance, and tax strategies to boot. Other companies offer attractive budget bookkeeping support, but little in the way of CFO guidance, while yet others cater to businesses that utilize a wide-variety of payment and payroll software integrations. Unlike QuickBooks Live Bookkeeping, Bench also offers historical bookkeeping services beyond the last filed tax return as well as tax filing and advisory services. And if you need accounts receivable or accounts payable, Bench offers specialized bookkeeping for an additional fee.

Our Top Picks for Best Online Bookkeeping Services

Providers of bookkeeping services also often invoice clients’ customers, pay their bills, and process their payroll. A particularly skilled bookkeeper will also offer services like cash flow forecasting and management to their small business clients. How often are you looking at your total current income and total current expenses? Leveraging bookkeeping services allows you to look at your income and expenses in real-time frequently.

Many of the operations are automated in the software, making it easy to get accurate debits and credits entered. So, while it appears that Finally offers some powerful software, it comes with a series of separate subscriptions, as opposed to an easily digestible upfront cost. As a side note, Finally is rolling out some intriguing corporate card and finance services, so be sure to check it out while browsing their bookkeeping and invoicing plans. Start by deciding on the system you want to use, whether it’s an online program, paid software or a spreadsheet.

Best for Small Businesses

Next, set aside a dedicated time either weekly or biweekly to review your bookkeeping, reconcile transactions and complete necessary data entry. Finally, you’ll want to decide how all receipts and documents will be stored. You can either keep hard copies or opt for electronic files by scanning paperwork.

• It also offers full-service bookkeeping, meaning that its team will do the bookkeeping for you.
• Bookkeepers reconcile bank accounts for all of a company’s transactions, ensuring there is agreement and balance.
• When bookkeepers use the cash-basis method, they record transactions as money is paid out or received by the business.
• When she’s not trying out the latest tech or travel blogging with her family, you can find her curling up with a good novel.
• Customer satisfaction with Merritt Bookkeeping is consistently high, with customers reporting fast service, responsive and helpful customer support and an easy-to-use platform.
• When it comes to business bookkeeping, there are a variety of sources you can turn to in order to keep your finances organized, reconcile your books, and manage your accounting software.

9 Best Online Bookkeeping Services 2024

If you’re behind on your tax payments or have past years where you didn’t even file a return, you probably feel the pressure mounting. They can help ensure that each of these tasks are completed correctly, in a timely manner, and that they are accurate enough to be truly useful. Laura is a freelance writer specializing in ecommerce, lifestyle, and SMB content.

Small businesses often schedule video appointments once or twice per month to discuss questions and to review results. You’re limited to one scheduled appointment at a time and appointments have to work within your bookkeeper’s schedule. Communications that are available any time include document sharing and live chat with a member of your bookkeeper’s extended team. For additional features, these were elements that fell into the “nice-to-have” category that not all software providers offered, either as part of their regular plan or as a paid add-on. Bookkeeper360 is best for businesses that occasionally need bookkeeping services as well as those that want integrations with third-party tools.

How does QuickBooks Live Bookkeeping work?

Leaving taxes to the last second causes businesses to lose out on opportunities that come with frequent expense and revenue tracking, accurate balance sheets, accrual accounting, financial reports, and much more. Choosing the right bookkeeping services for your small business will also free up time for you to focus on your company, easing a lot of stress. Online bookkeeping is a good solution for many businesses that can’t afford or don’t need an in-house bookkeeper.

If you only have a handful of clients, a basic bookkeeping service may provide all the assistance you need to keep your books in order. If your business has a large customer base, however, you might need to consider a more expensive plan that offers advanced services, like accounts receivable tracking or invoice processing. It’s a way of recording in which every transaction is logged in two accounts, as both a credit and a debit. If all entries are made correctly, the company’s credits and debits will be equal, and the books will balance. Double-entry bookkeeping has become the industry standard and is used by almost all online bookkeeping and accounting services. Whether you use in-house or outsourced bookkeeping, these services will help you understand your company’s financial health and ensure your records are in order for tax time.

One-on-one expert support

So while their low price may be attractive, it’s caveat emptor when it comes to Accountant’s bookkeeping services. FinancePal has its roots in the 2010 online tax service, Community Tax. After merging with Jordan CPA in 2020, FinancePal is a large, stable company, but one that apparently is experiencing some communications difficulties. When compared to competitors, Bookkeeper’s Lite CFO and advisory services come at a bargain.

• FinancePal provides an all-in-one bookkeeping solution that includes features, such as transaction reconciliation, bill pay, business projections, guidance, catch-up bookkeeping, financial statements and tax filing.
• You can communicate with your bookkeeping team through Pilot’s customer portal.
• IgniteSpot Accounting boasts a more personalized approach to outsourced accounting services.
• Some additional services you may have access to include inventory tracking, BillPay, CFO services, and tax services.

You can use its monthly financial reports to assist with filing taxes, and it provides a simplified issuance and electronic filing of 1099s for your contractors at an additional fee. The cost of bookkeeping services can vary depending on the size of your business and the features you need. Some bookkeeping services charge a monthly fee while others charge by the hour. You can find services for as little as $20 per month while others run thousands per month.

Quickbooks Online Accountant Review 2024

QuickBooks Online is one of the most feature-rich, but easy-to-use accounting solutions on the market, and can help to make the process infinitely smoother. Tax season arrives for everyone, and your business should be prepared ahead of time. Find out which tax deadlines are relevant, depending on the federal, state, and local regulations that may apply to your operation. If you’re using QuickBooks Payroll, it has the tax reporting functionality needed to walk you through this process, although you’ll still need your federal and state ID numbers. It’s important to note that FreshBooks is the most competitively priced software solution we found.

The practical implication of this is that you’ll end up typing custom descriptions for every invoice you issue. QuickBooks Online has four pricing plans to choose from, each with its own set of features and allowed users. See below for more information about the features included with each plan. Check out our guide to the leading small business accounting software for more ideas. The items list is flexible enough to accommodate both simple and complex product catalogs.

Setting up accounts and importing data

It is designed to make their accounting a seamless process with your firm, not to track calls and communications. This means that some data may be displayed but not always in the most efficient way. It has a simpler user interface than QuickBooks Online, with fewer options and features, and an intuitive navigation. It provides step-by-step guides and in-app prompts to help users navigate the software and complete tasks. QuickBooks Self-Employed is designed specifically for self-employed individuals, freelancers, and independent contractors.

• Meanwhile, QuickBooks Desktop is an on-premise software that needs to be installed on the computer where you use it and is available as an annual subscription.
• Small businesses often schedule video appointments once or twice per month to discuss questions and to review results.
• You have the option of contacting QuickBooks customer support directly for any help you may need too.
• Once you have a handle on day-to-day use of the QuickBooks Online accounting software, try adding a few more tips and tricks to help you get the most out of the experience.
• The second problem is how the line-item descriptions, called product or service items, are managed.

It has a thorough set of ready-to-go reports, along with the ability to create new reports. Still, QuickBooks isn’t as powerful as other enterprise accounting tools, so large businesses may prefer a more scalable alternative instead. Accountants have complete access to a company’s books when using QuickBooks Online Accountant.

QuickBooks Online vs Self-Employed: Customer Support

You have easy access to all the common financial statements like balance sheet, profit and loss (P&L) statement, cash flow statements and taxes filed. You can take a printout of these statements for your accountant and send it across to them at the time of filing or invite them to view these statements without needing a login ID or password. As a business owner, you know how important it is to manage a regular positive cash flow. QuickBooks Payments makes it easier for you to accept online payments when you send invoices from within the app. While there are many options available, you do not need to sign up for all of the QuickBooks services all at once. You can start with a single app, such as the accounting or payroll software, and add others as you expand.

QuickBooks Enterprise Review 2023: Features, Pricing, Pros & Cons

It’s also a better option for businesses requiring complex inventory accounting features. Meanwhile, QuickBooks Premier has two payroll options with prices that start at $50 per month plus $5 per employee. If you can file taxes confidently on your own, Enhanced Payroll might be suitable. If you want QuickBooks to file your taxes for you, then you must upgrade to QuickBooks Desktop Assisted Payroll for $109 per month plus $2 per employee. Learn how else the two products differ in our QuickBooks Desktop Payroll Enhanced vs Assisted Payroll comparison. Both QuickBooks Online and Desktop are on our list of the best small business accounting software.

How To Convert QuickBooks Desktop to Online in 5 Steps

Once it’s connected, you’ll be able to see all of the accounts you hold with this bank, so select your business account, and then select the transactions you want to transfer over to your QuickBooks account. Most banks will show transactions from the past 90 days, although some banks will let you go back as far as 24 months. It’s quick and easy to automatically import your business economic efficiency data to your QuickBooks Online app, so you don’t have to start from scratch. You can import information such as your bank transactions, your Chart of Accounts, supplier bills, employees, budgets and customer or vendor data. QuickBooks Desktop is an annual subscription, starting at $549.99 per year, which may be cost-prohibitive for small businesses or cash-strapped startups.

Customize Your Expense Classifications With a Chart of Accounts

In this guide, we’ll break down QuickBooks Online pricing, including plans, key features, and alternative platform costs so you can decide which option is best for you. One user noted that it’s easy to add vendors and customers and share files with their bookkeepers, while another commented that the bank account reconciliation and invoicing features are excellent. However, some complained that QuickBooks Online can’t manage multiple companies in a single account and that it lacks assembly management features.

Its mobile app will use the GPS in your phone to sense every time you’re in a moving vehicle automatically. Then, you can review your trips, classify them as personal or business, and mark them as billable to a customer. Billable mileage expenses will then be available to add to the next invoice you create for that customer automatically. Currently, QuickBooks is offering two different specials; you can either try it free for 30 days or sign up and get a 50% discount on your first three months. In addition to QuickBooks Online, Intuit offers a desktop product called QuickBooks Desktop, which is locally installed rather than cloud-based.

QuickBooks Pricing

Learn which is right for you in our QuickBooks Online versions comparison guide. QuickBooks comes in both a cloud-based online platform and a traditional desktop program. You can read about the pros and cons of each in our comparison of QuickBooks Online vs Desktop.

What Is QuickBooks & How Does It Work?

Danielle Bauter is a writer for the Accounting division of Fit Small Business. She has owned Check Yourself, a bookkeeping and payroll service that specializes in small business, for over twenty years. She holds a Bachelor’s degree from UCLA and has served on the Board of the National Association of Women Business Owners. She also regularly writes about business for various consumer publications. If you’re a startup with plans of expanding your workforce, QuickBooks Self-Employed won’t be the best fit as it cannot be upgraded to other QuickBooks versions. QuickBooks Self-Employed is ideal for freelancers, real estate agents, and independent contractors, like Uber and Lyft drivers.

• Information is backed up into the cloud automatically, so you don’t need to think about what data recovery will look like if your system gets hacked or has a problem.
• These plans are priced based on the features included and number of users.
• QuickBooks Online will save you time and effort – but it works best when you keep it up to date.
• Once your bookkeeper receives all the necessary documentation, they’ll typically complete your cleanup within 30 days.

While QuickBooks Online is only 50 cents more than Xero, note that that is the introductory cost for the first three months. QuickBooks Online goes to $30 per month after that and is easily our most expensive option. Even for payroll, which has a huge tax liability, taxes are calculated automatically every cycle. If you operate in multiple international locations QuickBooks allows you to accept payment in local currencies. Of course, it is safer to first check if QuickBooks accepts payment in the currency you deal with.

QuickBooks Desktop

We encourage you to research and compare multiple accounting software products before choosing one. Even without those higher-level plans, you can create custom tags and run reports to show where you make and spend the most money. These features can help you organize your finances and provide insights such as cost-cutting opportunities or sales trends that you can use to improve and grow your business. One thing that customers have complained about is the use of QuickBooks ads on the dashboard.

With five plans, each at different price points, users can choose the plan that best meets their business needs without paying for additional features that they don’t want. As a business grows, users can easily upgrade to a more advanced plan with additional features seamlessly. QuickBooks is the platform most used by professional accountants so if you plan to work with an accountant, they will likely be very familiar with the platform, its features and capabilities. QuickBooks Desktop is more traditional accounting software that you download and install on your computer, while QuickBooks Online is cloud-based accounting software you access through the internet. For the Desktop version, you pay an annual fee starting at $549.99 per year, and the cloud-based option starts at $15 per month.

Import business data

Likewise, a non-profit can save time by using nine tailored reports ― like contribution summaries ― instead of setting those up manually. And the professional services edition lets you analyze profitability by customer, geography and other factors, helping you make informed business decisions. It also eliminates the need amend your tax return with sprintax for other software by allowing you to track customer prepayments and create customizable proposals. For QuickBooks Online users, assisted bookkeeping is available in the form of QuickBooks Live. They are also available for telephone or one-way video calls, to answer questions and troubleshoot any bookkeeping issues.

How QuickBooks Online keeps your information secure in our Bank Feeds

However, access to add-on services to the QuickBooks Desktop for Windows 2019 was discontinued after May 31, 2022. You’ll get the most value out of QuickBooks Online if you understand how to use its transaction tags and reporting capabilities. If you’re not sure whether you’re getting the most of these features, consider asking your accountant to review your chart of accounts and how you’re categorizing transactions. Our partners cannot pay us to guarantee favorable reviews of their products or services.

How much does QuickBooks Online cost?

If you report income on Schedule C of your personal income tax return, this cost-effective option might be best for you. Every business is unique, and there may be instances where QuickBooks Desktop may be a better fit. For example, it may be more suitable for businesses with complex inventory management needs or those wanting offline access to their financial data. However, QuickBooks Online is the better choice for most companies, especially those with remote accountants and multiple employees.

Best Free Accounting Software for Small Businesses

If you run a small business, you’ve likely heard of QuickBooks Online, the smart accounting software that helps you keep on top of everything from taxes to payroll. But if you’re new to QuickBooks (or perhaps you’ve switched from QuickBooks desktop version), you might be wondering just how to use it. Access your account via the cloud for up to 25 users with the Online version, and pay an additional fee per user, up to 40 users, for cloud access with Desktop. What used to be a huge bulk of QuickBooks business is no longer so—it focuses mostly on its cloud version and actively encourages users to make the switch from Desktop to Online.

A popular add-on is the payroll feature where you can run payroll and access benefits in one convenient place. It does cost more to access this, which is approximately $22.50 more per month plus $5 per employee, per month. When subscribing to this service, you’ll get a 1099 e-file of forms and a next-day direct deposit. Moving up to the Essentials Plan, you’ll pay $16.50 per month for the first three months, $45 per month. This plan adds up to three users to the account so that the right people have access to data at their fingertips. It also gives you bill management and collects employee time for invoices to add them for proper billing.

What’s the difference between QuickBooks Online and QuickBooks Online Accountant?

QuickBooks Online Simple Start costs $30 per month, includes only one account user (plus access for two accountants) and does not offer billable hours tracking, bill pay or inventory management. For multiple users, bill pay and the ability to add billable hours to invoices, you’ll need to upgrade to the Essentials plan, which costs $60 per month. For inventory management, you’ll need to opt for the Plus plan at $90 per month. With the desktop version, you’ll need to access the latest version with new features and security patches via downloaded updates, making this a less secure version than the QuickBooks Online version.

Tax credits and deductions for individuals Internal Revenue Service

Both revenue and net income are useful in determining the financial strength of a company, but they are not interchangeable. Revenue only indicates how effective a company is at generating sales and revenue and does not take into consideration operating efficiencies which could have a dramatic impact on the bottom line. Knowing the difference between both is very beneficial when it comes to making decisions regarding the pricing of products or services, budgeting, and planning for the future of the business. There are several ways to calculate income, but generally, it equals total revenue minus total cost in producing a product or service. Income refers to earnings after all expenses have been accounted for.

• Remember, net income is a smaller number than revenue because net income is the result of total revenue minus all of the costs or expenses for the period.
• It’s akin to understanding both the breadth and depth of a firm’s financial ecosystem.
• Earnings and revenue are two of the most reviewed numbers in a company’s financial statements.
• This type of revenue is generally less consistent than operating revenue.

Our team of reviewers are established professionals with decades of experience in areas of personal finance and hold many advanced degrees and certifications. The most important distinction between income and revenue is knowing what they can be used for and when they should be used. A sales allowance is an amount subtracted from revenue which are refunds for damaged, defective, or incorrectly shipped items. Simon Property Group (SPG) and Brookfield Asset Management (BAM) rescued JCPenney out of bankruptcy in the fall of 2020.

Nonoperating Revenue

If a company sells a product to a customer and the customer goes bankrupt, the company technically still reports that sale as revenue. Therefore, revenue is only useful in determining cash flow when considering the company’s ability to turnover its inventory and collect its receivables. Gross sales are calculated by adding all sales receipts before discounts, returns, and allowances. For smaller companies, this may be as easy as calculating the number of products sold by the sales price.

• In general, income can never be higher than revenue because income is derived from revenue after subtracting all costs.
• Indirect costs are expenses that aren’t directly related to manufacturing or buying goods for resale.
• Examples include salaries and benefits, factory equipment (depreciation and maintenance), rent, and certain utilities.
• Grasping these concepts is vital, especially when delving into financial statements, an investor’s primary tool for gauging a company’s worthiness as an investment.
• Income refers to profit or earnings after expenses have been deducted from the gross revenue.

Revenue is the most basic yet important indicator of a company’s profitability and its overall financial performance. It is a critical measure of financial performance that reveals how well a company can generate money from its primary cash flow statement indirect method business operations. Generally, analysts and investors carefully assess the company’s revenues from different periods to identify their growth trends. Net profit is calculated from the final section of an income statement.

What is Revenue vs Income?

Regularly evaluate your pricing strategies and compare them to industry benchmarks. Consider factors such as production costs, market demand, competitor pricing, and perceived value to determine optimal pricing levels. Get instant access to lessons taught by experienced private equity pros and bulge bracket investment bankers including financial statement modeling, DCF, M&A, LBO, Comps and Excel Modeling.

An Illustrative Dive: Revenue vs. Earnings

For an individual, income is the total money earned, including salaries, tips, interest, dividends, and others. Earnings are perhaps the single most important and most studied number in a company’s financial statements. It shows profitability compared to analyst estimates, the company’s own historical performance, and relative to its competitors and industry peers.

As of late 2022, it had about 670 stores while reporting low debt levels largely as a result of the restructuring. Technically, net sales refer to revenue minus any returns of purchased merchandise. Pete Rathburn is a copy editor and fact-checker with expertise in economics and personal finance and over twenty years of experience in the classroom. These are similar to net income, except they exclude a few cost items. As an example, consider a hypothetical business — a grocery store with $100,000 in sales per year. Harold Averkamp (CPA, MBA) has worked as a university accounting instructor, accountant, and consultant for more than 25 years.

Treatment of expenses and deductions

Earnings, also known as profit or net income, refer to the amount of money left over after deducting expenses from revenue. Unlike revenue, earnings reflect the financial performance of a company after all costs, including operating expenses, taxes, interest payments, and other deductions, have been accounted for. Revenue provides managers and stakeholders with a metric for evaluating the success of a company in terms of demand for its product.

The Difference between Revenue and Earnings

Revenue is calculated by multiplying the unit price of goods or services by the number of units sold (quantity produced). Direct costs are expenses specifically related to the cost of producing goods and services—things like parts, raw materials, utility bills, direct labor, and commissions or professional fees. Indirect costs are expenses that aren’t directly related to manufacturing or buying goods for resale. Examples include salaries and benefits, factory equipment (depreciation and maintenance), rent, and certain utilities. For discerning investors, juxtaposing the two metrics can yield invaluable insights, ensuring informed and judicious investment decisions. Remember, a holistic examination of a company’s financials is always the bedrock of a sound investment strategy.

Note that the tax regulations regarding income types may vary among tax jurisdictions. You might want to bolster revenue recognition policies and keep with accounting standards to ensure accurate and compliant financial reporting. Following recognized standards like GAAP or IFRS helps businesses maintain consistency, transparency, and comparability in financial statements. Calculating earnings, in very general, involves deducting all expenses from the revenue.