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How to start a bookkeeping business? 

Are you considering beginning your own bookkeeping business? You’ve arrived to the right location. Whether you’re transitioning from a corporate job to self-employment or are a first-time entrepreneur, there are several steps you should take to guarantee your new business succeeds.

You’re ready and excited to take the next step and start your own accounting firm, but where do you start? And, maybe most significantly, how? We are certain that the information provided below will be helpful to anybody considering beginning their own accounting firm and putting the pieces together.

What is it, and who is it suited to?

Bookkeeping is the process of manually recording a company’s financial transactions in ledgers or entering them into a computer.

Bookkeeping may be the career for you if you are organized and systematic, enjoy working with records, and appreciate seeing a set of numbers add up correctly. People of all ages are becoming bookkeepers, according to the ICB.

Bookkeeping may be the initial step toward becoming a qualified accountant for young people who have recently graduated from high school or university.

Bookkeeping can be an excellent method for older persons with years of experience to continue working without having to confront the daily grind.

Many bookkeepers are women looking for a well-paying job they can do from home while raising their children.

Bookkeeping Tasks

Bookkeepers are in charge of an organization’s ledgers, which are the most important accounting documents. Transactions such as revenue and outgoings are recorded and posted to various accounts on a daily basis. With exposure to various elements of the accounting function, a Bookkeeper job description should emphasize the requirement for a good sense of time management and organizational abilities. It can also be a stepping stone to a more senior or specialized accounting career.

Setting up a company’s chart of accounts, opening balances, creditors, debtors, bank and loan accounts, transaction accounts, and so on are all examples of bookkeeping chores. This job is usually done in collaboration with an accountant who is familiar with the company’s demands and structure.

Because there was no expectation of professional accounting or taxation knowledge, bookkeeping tasks were often performed by the owner’s wife (for small trades) or a trusted worker in small businesses, but it’s now considered a profession, particularly because it ties in with heavily regulated areas of our financial lives like superannuation.

Since financial performance information is now reported with the ATO more frequently in the form of BAS‘s for GST reporting, bookkeeping is now considered a profession. Because this information is submitted directly to the ATO, the individual conducting the work must understand what they’re doing and sign off on the accuracy of the data.

Steps on How to Start a Bookkeeping Business

A job in bookkeeping can be a good fit for you if you’re organized, appreciate numbers, and enjoy assisting others. By recording revenue and spending, validating receipts, depositing cash, checks, and other payment types, processing payroll, producing invoices, establishing an annual budget, and keeping track of delinquent accounts, bookkeepers assist businesses in maintaining correct and balanced financials. You can work part-time or full-time from home. And getting your firm off the ground doesn’t need a large investment.

Although purchasing a franchise bookkeeping business is an option, there are compelling reasons to go it alone and start one from scratch. Your knowledge of accounting and accounting software applications is the foundation of a bookkeeping firm. If you’re a virtual assistant, your success will also be determined by how well you get along with others and how productive and cost-effective you are.

If you are a people person who works hard, you may discover that word of mouth marketing with your friends is a good way to get your initial customers.

Rules and regulations

If you own a business, you may feel like you’re always juggling many things at once. Although bookkeeping may not always be a top concern, it is critical not to overlook the importance of accurate accounting. You may be focused on launching a new product or ramping up your marketing campaign, but the moment you lose sight of the statistics, your company’s future is jeopardized. Making profits is the key to success, and if you’re not careful with your bookkeeping, this may be a difficult goal to achieve.

Anyone considering beginning their own bookkeeping business in Australia should be aware of the BAS Agents regulations. They are qualified to charge for Business Activity Statement services.

Any bookkeeper who wants to offer BAS services must first become a BAS Agent. A bookkeeper must have 1400 hours of experience and a minimum qualification of a Certificate IV in Bookkeeping or Accounting to become a registered BAS Agent.

Professional Standards for Bookkeepers

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Members of CPA Australia have a duty to act in the public interest. In all of your transactions, you must adhere to the essential values of honesty, objectivity, professional competence, due care, confidentiality, and professional behaviour.

APESB is a nationwide, autonomous organization that was founded in 2006. It establishes the ethical and professional standards that CPA Australia, Chartered Accountants Australia and New Zealand (CA ANZ), and the Institute of Public Accountants (IPA) members must follow.

If you are admitted into National Bookkeepers, you must sign the National Bookkeeping Code of Professional Conduct and furnish a Professional Services Agreement for the work you provide for small businesses.

You’ll have a greater knowledge of what it takes to run a successful bookkeeping firm without incurring the expenditures of a franchise.

These professional standards are also important for our licensees, as it is expected that their invoices will be paid on time and that they will be well-regarded as small business contractors

Training and Quality

When you join National Bookkeeping, you’ll go through our training and orientation programs to ensure that you’re up to speed on accounting software and the business.

Your membership gives you access to ongoing education on a variety of topics related to bookkeeping, accounting, and taxation, as well as business and marketing assistance and introductions to practicing bookkeepers and BAS Agents.

Hundreds of different RTOs (Registered Training Organisations) provide bookkeeping certificates in Australia, and these abilities are crucial for all bookkeepers to stay current in their skills and legislation. Still, they want to expand the services they provide and the rates they get as a result.

The Small Business StartUp and Admin Course is presented to new National Bookkeeping Licencees, and it includes a bookkeeping business plan produced by our BAS Agent Jacci to utilize as a template in their studies. This training not only assists licensees in running their own businesses effectively, but it also allows them to pass on their skills to their small company clients.

We believe in providing education to both our members and their clients, therefore as a member, you’ll have access to digital marketing and course material support, as well as special discounts for your clients.

Your Bookkeeping Business Plan

Management of spending, income, tax returns, and payroll are among the professional activities required by the accounting firm. To run a profitable accounting firm, you’ll need to plan ahead for all of these services and more. So, what are the most significant requirements to consider while creating a plan?

A business strategy is made up of several distinct phases. The procedures and features needed to establish a business plan for your new accounting firm are outlined here.

If you want to advance as a bookkeeper and be more helpful to your clients, you must prioritize learning about the accounting profession as well as small business technologies and expectations.

Examine the contents of the current business plan (prepared by our Registered BAS Agent), make any required adjustments to fit your own circumstances and goals, and then implement it in your own corporation to achieve success.

Sales and Marketing for Bookkeepers

Because the two positions are nearly irreconcilable, many bookkeepers fear the possibility of selling. Even yet, just like any other business, marketing and selling your bookkeeping services is critical.

The internet has changed the way businesses use accounting software and find bookkeepers and other service providers to help them manage and expand their operations.

We provide bespoke support packages if you require more targeted help marketing your services or closing sales with new clients.

Your regional licensee manager is committed to helping you develop all of your business abilities, including the confidence to establish a successful sales and marketing strategy to expand your company. You don’t have to be harsh and brassy to promote your own bookkeeping services; simply be yourself. However, the more you learn about the complexities of selling, the simpler it will be to incorporate it into your daily encounters.

Directory Listing and Exposure

Licensees receive a legal package (including template agreements), a unique directory listing, and a phone number to demonstrate the need for their services.

The majority of your learning will be completed in the first year, so your ongoing fees will be minimal.

A great element of a National Bookkeeping license is that it is built on upskilling and being rewarded in your early years of business, and then providing a framework where all members profit from group-level marketing.

Starting a Bookkeeping Business: Pros and Cons

The Pros of Starting a Bookkeeping Business

If you possess those qualities, consider the following advantages of beginning an accounting business:

  • An accounting firm has very low startup costs.
  • For greater marketability, you can specialize in one accounting program.
  • It’s consistent work that usually happens on a regular basis.
  • You can work from anywhere and reach a larger audience.
  • There are no official prerequisites for credentials or training (but becoming certified is always a good idea).

The Cons of Starting a Bookkeeping Business

If you establish an accounting business, you may face the following difficulties:

  • There could be serious liability concerns.
  • You must take steps to guarantee that all client information is maintained safely.
  • Purchasing and updating multiple accounting software can be costly.
  • You must be familiar with technology in order to gain access to a client’s computer if necessary.

FAQs in starting a bookkeeping business

However, there are a couple of questions that should be on your mind. And you must have the answers before diving into the bookkeeping company.

How Long Will It Take Me To Get My Bookkeeping Business Off The Ground?

Bookkeeper Launch, a comprehensive bookkeeping business course, is designed to be completed in ten (10) weeks. Some students even land their first client throughout the course!

While Bookkeeper Launch is designed to assist you in starting a bookkeeping firm in ten weeks, the final decision is yours. If you can commit your full focus to your bookkeeping business, it will take much less time to grow.

Bookkeeping is a straightforward business. However, this does not imply that it is simple. Nothing worthwhile in life comes easily. Again, it’s a short-term cost for a long-term reward.

The bottom line is that you can be up and running in ten weeks. It’s entirely up to you, my friend! You have complete control over your life.

How Much Are The Start-up Costs?

Starting a bookkeeping firm is much less expensive than you might think.

Also, keep in mind that bookkeeping is the most profitable business. Because this is a virtual bookkeeping firm, you’ll need:

  • To start a bookkeeping firm, you’ll need a computer with high-speed internet connectivity and cloud-based bookkeeping software (and run it.)

Other initial expenditures to expect when starting a bookkeeping business, in addition to these three essential items:

  • company cards (even though you hand them out on rare occasions), Office supplies for $20 (ask Dwight Schrute for a discount, although they could cost $100)
  • $50 for a domain name and hosting account to get started.
  • Around $100 for a do-it-yourself website…
  • It’s primarily a matter of your time and work. This estimate includes stock photographs as well as the platform itself, such as Wix or Square Space. If you require more freedom, you may alternatively utilize WordPress.
  • Xero certification to prove to your clients that you’re a badass bookkeeper. It costs $249. However, I can get that fee waived. This will be discussed further later.
  • A $200 deposit is required for mistakes and omissions insurance. What precisely is mistakes and omissions insurance? If anything goes wrong, you make a mistake, or you forget to do something, this is your saving grace. You hope to never need it, just like any other sort of insurance. However, just in case, you should get this insurance. Without it, you should not start a bookkeeping business!
  • Computer security software (such as disk encryption and password management)…
  • This cost around $185.
  • Creating a bookkeeping organization, obtaining a company license, and paying some additional often encountered taxes. This varies a LOT from state to state and county to county. But I’m going to set the bar at $300. You don’t have to form a corporation or a limited liability company to start your business (LLC). However, I emphasize the significance of obtaining it, just as I do with errors and omissions insurance.

There are various flavours to choose from when forming a corporate corporation.

So, assuming my math is correct, your expected launch costs are around $1,404.

If you’re a frugal person, I’m sure you can save some money. You can also put off acquiring some of the products I mentioned above.

The majority of businesses spend tens of thousands of dollars to start.

But not your accounting firm! For little than $1,500, you can get started in the world’s most profitable business.

What Equipment, Technology, And Certifications Will I Require To Start A Bookkeeping Business?

Every craftsman requires his or her tools. Why?

To assist him in completing the job to the best of his ability in the shortest amount of time possible so that a high-quality finished product can be delivered.

There is a vital mentality you must acquire before diving into your research of the EXACT tools, technology, and professional certification you need to start a bookkeeping firm.

Bookkeeping is a respectable and well-established PROFESSION. While there are now no rules or regulations requiring you to be licensed in the United States, you still must adhere to this truth:

“AS A BOOKKEEPER, I AM A PROFESSIONAL. AS A BOOKKEEPING PROFESSIONAL, I MUST CONTINUE TO DEVELOP MY CHOSEN CRAFT AND EACH DAY STRIVE TO BECOME BETTER THAN THE PREVIOUS.”

Let us now change our focus to the specific tools, technology, and certifications you require, while maintaining this professional mindset.

We addressed some of the specific pieces of technology and resources you’ll need to start a bookkeeping firm in the “how much does it cost to start” section above.

Right now, I’d want to talk about the most critical thing you’ll need: a good bookkeeping program.

The hammer is a carpenter’s go-to tool. Alternatively, the nail-gun.

The bookkeeping application is your go-to tool as a great bookkeeper. (I’ll refer to it as your bookkeeping app from now on.)

To begin, I’d want to provide some prerequisites for ANY software you use to provide bookkeeping services to your clients:

  • You will run a virtual bookkeeping firm via the cloud. That means you can serve your customers no matter where you or they are. Never rely on location-based applications. This restricts your ability to assist others.
  • You’re dealing with a lot of sensitive financial data, therefore you need military-grade protection. As a result, it’s only natural that the cloud-based bookkeeping tools you use safeguard that information.

Let’s talk about the workhorse application, which I adore, now that you know the criteria by which to grade bookkeeping and peripheral programs.

If Cloud-based Bookkeeping Apps Are So Great, Why Do Small Businesses Need A Bookkeeper?

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Yes, bookkeeping software for small businesses is fantastic. These programs handle the daily data entering and number crunching, but that’s all they do.

Apps for bookkeeping cannot take your place. You’re an amazing person who uses the financial transaction reporting given by bookkeeping software to help your clients grow their businesses.

It’s a win-win situation for both you and your client. They receive better service, and you profit more.

Bookkeeping apps take care of a lot of the tedious labour that bookkeepers had to do even five years ago, allowing you to focus on providing premium service at premium rates.

You can do the following with bookkeeping software:

  • Be efficient so you can serve more clients and do so more quickly…which means more money and less effort for you!
  • Make more money in a shorter period of time
  • Maintain your optimal work-life balance.
  • If you want to become a great bookkeeper and make a good living, you’ll need to be able to do more than just crunch numbers.

“People won’t care how much you know until they know how much you care,” stated the late Zig Ziglar, one of the most brilliant men on motivation and human connections.

That care will never be replaced by a machine or an app. This is entirely up to you as a fantastic bookkeeper!

Remember that being personable and kind was the most important character trait.

The bookkeeping tools can run the numbers, but only a smart bookkeeper can read the information and put it into plain English for the client. And do so in a personal and compassionate manner.

How Do I Get Clients And Make Money While I’m Starting A Bookkeeping Business?

Let’s speak about how to MAKE money now that we’ve discussed how to spend money…

Because without clients, your bookkeeping firm is little more than a hobby.

Clients can be acquired in a variety of methods. What works for you may not work for someone else, but there is ONE killer method that works for everyone!

It is the simplest and quickest method of obtaining excellent clientele. The best part is that it’s practically free!

Make contact with others! Please inform your family, friends, acquaintances, business owners, and anybody else you know. You won’t believe how productive this is!

What Accounting And Bookkeeping Services Can I Provide To Small Business Owners?

You need a bookkeeper who can handle more than simply the paperwork that comes with owning a small business. You want someone on your side when it comes to one of the most critical aspects of your company: financing.

Bookkeeping services guarantee that your financial records are kept up to date, that payments and receipts are made on time, and that your submissions are complete cheval. They should also send you a monthly report that explains what it implies for your company. This service should take up very little of your time.

The monthly preparation of the three main financial statements is at the heart of small business accounting:

  • a financial statement
  • Statement of Income
  • Cash Flow Statement

You can also provide add-on services in addition to the preparation of these three basic financial statements, such as:

  • Management of accounts payable
  • Management of accounts receivable
  • Prepare tax returns and paperwork for self-employment.
  • Make invoices.
  • Payroll processing
  • Additional financial reports, such as a budget
  • assisting in the tracking of long-term assets such as machinery and equipment

To provide these services to your clients, you must understand accounting and bookkeeping fundamentals, such as:

  • Double-entry bookkeeping (think of this as a simple formula)
  • Preparing the general ledger (made easier through online bookkeeping software)
  • How should financial transactions be classified and recorded?

But these can all be learned!

A mix of education, certification, and mastery of the job tools is an excellent foundation for getting to the point where you’re ready to start your own firm. Most clients will want to see that you have some experience, as well as a recommendation from other business owners. Furthermore, a strong motivation for starting a bookkeeping service is a desire to assist others in successfully running their businesses.

You don’t need accounting credentials, but having some understanding can’t hurt, especially if you’re the go-between for the business owner and their accountant.

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