5 Ways a Virtual Bookkeeper Makes an Accounting Firm Scalable

The idea of a virtual bookkeeper has been around for a while, helping small and medium businesses manage their books without the hefty costs of hiring an in-house bookkeeper. With the emergence of cloud accounting platforms such as QuickBooks Online and Xero, having a bookkeeper working remotely became a norm. But here’s something interesting: even accounting firms with a team of skilled accountants are discovering the benefits of virtual bookkeepers.

So, what’s behind this shift? Why would accounting firms consider hiring virtual bookkeepers and building a team beyond borders for client work that they could handle with their on-site teams? The reasons are more compelling than you might think.

Adding a virtual bookkeeper to the accounting firm team mix is not just about saving payroll costs. It’s about empowering the accounting firm to scale.

In this blog we will learn 5 ways Virtual Bookkeeper make Accounting Firm scalable.

Introduction

Virtual bookkeepers bring a lot of benefits that are too good for accounting firms to ignore. You already know about the cost savings — virtual bookkeepers often cost less than having an in-house bookkeeping and accounting team because you save on office space and overhead expenses. But there’s a bigger reason why virtual bookkeeping is becoming essential: the ongoing shortage of talent in the accounting industry.

By using virtual bookkeepers, firms can easily hire skilled professionals from anywhere, avoiding ongoing hiring hassles and limitations.

As baby boomers retire and fewer students enroll in accounting programs, the accounting industry faces a dwindling supply of accountants in the nation. Although the NPAG Committee is addressing these talent pipeline issues, the immediate needs of the industry persist, requiring innovative solutions to continue delivering high-quality client services.

Accounting firms are seeking skilled bookkeepers and accountants to provide top-notch service to their clients, and new hires often demand competitive salaries. In a recent Accounting Today webinar “Winning the War for Talent” Kristin Murray, Managing Shareholder at Weinstein Spira mentioned that starting salaries in accounting are not competitive with other majors and do not keep pace with inflation.

A strategic solution is to allocate high-value tasks to on-site staff and offload routine bookkeeping tasks to an economic staff. This approach not only helps manage costs but also makes scalability a possibility. But to make this approach work, you need to partner with a reliable virtual accounting firm connecting you with the right fit virtual bookkeeper.

Mistakes to Avoid when Hiring Virtual Bookkeeper

If you want your accounting firm to succeed with virtual accounting, there are five big mistakes to avoid:

Hiring Virtual Bookkeepers on a Freelance Basis – Sites like Fiverr and Upwork have many skilled virtual bookkeepers. However, finding the right one involves a lot of checking and screening. Freelancers also work with many clients at once, so they might not always focus fully on your work.
Using Only Junior Staff for Complex Tasks – Sometimes, accounting tasks are too difficult for junior staff alone. If you only use junior staff, you might end up having to fix their mistakes later. It’s better to use some senior accountant hours for these tough tasks to make sure the work is done well and without errors.
Time zone Overlap Issues – To get the cost benefit of virtual bookkeeping, you will be working with an offshore staff which comes up with a different time zone challenge. You don’t just want to rely on asynchronous communication. Doing so have several disadvantages – delayed responses, scheduling conflicts to name a few. You must have a clarification in the discovery call with your virtual accounting firm about the overlap time. Also, having a virtual bookkeeper with a smaller time difference is better.
No Productivity Check – To make remote accounting work for your accounting firm, you need to have a virtual bookkeeper with a communication structure ensuring productivity check. If working with an individual or on a contractual basis, you have to setup these checklists yourself. If you decide to partner with a virtual accounting firm, ask them about the productivity checklist at the time of discovery call.
Data Security Concerns – During the initial discovery call, it’s important to inquire about the methods of communication for exchanging sensitive information, protocols for sharing client data, responsibilities for data security, and procedures for responding to potential data breaches. Ensuring data security with a freelance virtual bookkeeper can be complicated.

Many accounting firms have made these mistakes and then wrongly concluded that virtual bookkeeping isn’t effective for them. While freelancers can be great for short-term projects, for a long-term partnership, it’s better to choose a professional virtual accounting firm that specializes in working with US-based CPAs and accounting firms.

Let’s revisit how virtual bookkeeping can actually empower you to grow your accounting firm.

What is Scalability for Accounting Firm?

Scalability for accounting firms refers to their ability to handle an increasing workload and client base without sacrificing quality or efficiency. It’s about growing your firm in a sustainable way while maintaining profitability and client satisfaction.

Here are some key aspects of scalability for accounting firms:

Increased Capacity: The ability to take on new clients and manage a larger workload without overwhelming your existing team.
Resource Optimization: The efficient use of your resources, including staff, technology, and financial resources, to meet the demands of growth.
Adaptability: The flexibility to adjust your services, staffing, and technology as your client base and market needs evolve.
Standardized Processes: Delivering work following documented processes for core accounting tasks ensures consistency and efficiency, even as your team grows.

5 Ways Virtual Bookkeeper Make Accounting Firm Scalable

With offshore and virtual bookkeepers, accounting firms have got a better hold on capacity management. Ability to handle more workload allows accounting firms to scale. But there is more to the definition of scalability for accounting firm.

Check out the ways how virtual bookkeeping and virtual accounting make the accounting firm scalable:

1. Offload Repetitive Tasks

Your in-house staff are highly skilled accountants, but their time can get consumed by routine tasks like general ledger maintenance. Virtual bookkeepers act as an extension of your team, taking on these repetitive tasks. This frees up your in-house staff to focus on more strategic and client-centric activities.

List of tasks that you can delegate to virtual bookkeepers:

Data Entry
Bank Reconciliation
Accounts Payable & Receivable
Payroll Processing
Bookkeeping Cleanup
Financial Report Generation

And much more
You can assign your onsite staff to valuable tasks like Strategic Consulting and Business Advisory Services.

Also Read – Top 24 Tools for Accounting Firms Building Offshore Teams

2. Access to Global Talent

Traditional in-house hiring limits you to the talent pool in your local area. Virtual bookkeepers open the door to a global marketplace of skilled professionals. The biggest advantage with respect to scalability is that now you can adjust the size of your virtual team up or down as your workload changes. During tax season, you can add virtual staff with expertise in tax preparation. In slower months, you can scale back the team. This flexible approach allows you to optimize costs.

You only pay for the support you need, unlike the fixed salary and benefits associated with a full-time employee.

3. Free Up Resources for Strategic Growth

Scaling your accounting firm requires significant investment in areas like technology, staff training, and marketing initiatives. With salaries and payroll expenses consuming a large portion of your budget—and the ongoing talent war demanding competitive salaries—it’s challenging to allocate resources for strategic growth.

Consider the cost of growth initiatives such as upgrading your tech stack, providing necessary training, and, most importantly, investing in marketing efforts. To allocate the budget for these crucial areas, you’ll need to free up funds currently spent on payroll.

Virtual bookkeeping helps in saving following costs:

Operational costs, like office space, supplies, and software

Eliminate the need for additional office space, furniture, and utilities.

You don’t have to pay employee benefits like health insurance, social security, or unemployment taxes.

Cost-effective option for same level of work

Virtual bookkeeping offers a cost-effective solution, allowing you to manage your books at a fraction of the usual cost. Redirect the funds saved through virtual bookkeeping toward growing your firm.

Tip – Branding has become essential for accounting firms, not only to attract top talent but also for lead generation. At Credfino, we’ve developed marketing systems specifically tailored for accounting firms that enable them to generate leads automatically and efficiently.Check out here.

4. Tap Niche Talent

Hiring in-house staff often limits you to the qualified professionals available locally, which might restrict your access to specialists in specific industries or niche accounting areas. Virtual bookkeepers, however, give you access to a global marketplace of skilled accountants. This expands your talent pool, allowing you to find experts with specialized knowledge that can benefit your firm.

By partnering with a virtual accounting firm, you gain access to virtual bookkeepers who possess in-depth knowledge of specific industries, such as healthcare, construction, or non-profits. They understand the unique challenges and regulations of these industries, providing more efficient and accurate services.

Virtual bookkeepers also bring expertise in specialized accounting software that might be used in certain industries or by specific types of businesses. This expertise frees your in-house team from needing to master every type of software, improving efficiency and reducing the risk of errors.

By incorporating these niche experts into your services, you can offer greater value to your clients, allowing you to charge more and increase the profitability of your accounting firm.

5. Reduce Burnout, Retain Top Talent

You have an amazing team, but you risk losing them if you try to scale with limited capacity. It’s crucial to maintain an ideal staff-to-task ratio. Keeping your excellent staff happy is key to your firm’s success. Ensure they:

Receive competitive salaries
Achieve work-life balance
Freed from mundane tasks.

Your onsite staff are crucial for bringing in business; they lead your efforts. Keeping them happy and reducing burnout is essential for their satisfaction and your firm’s growth.

Also Read – The Impact of Hybrid Work Model on Offshore Accounting

Concluding Thoughts

Virtual bookkeepers are no longer a futuristic concept, but a strategic tool for accounting firms seeking to thrive in today’s competitive landscape. By addressing the talent shortage, streamlining workflows, and optimizing resource allocation, Accounting Firms can scale, embrace specialization, retain top talent and invest in lead generation. All of that starts with virtual bookkeeping and virtual accounting.

Partnering with a reputable virtual accounting firm is the key to unlocking these benefits.

Credfino has helped over 100 CPAs and Accounting Firms to understand their specific needs. At Credfino, we provide a skilled and diverse virtual bookkeeping and virtual accounting team, and deliver ongoing support and consultation to niche down, marketing for accountants and much more.

Schedule a call to know how Credfino can help your accounting firm.

FAQs

1. What types of tasks can virtual bookkeepers handle?

Setup of accounts

Cleaning of books

Recording all expenses and income

Maintaining various ledger and sub-ledger accounts

Fixed assets accounting

Reconciliations (Bank accounts, credit cards, vendor and customer statement, inter-company, ledger and sub-ledger)

Month-end closing and year-end closing

Consolidated financial reporting

MIS reporting

And much more

2. How does the accuracy of outsourced bookkeeping compare to virtual bookkeeping?

Virtual bookkeeping tends to be more accurate and reliable than outsourced bookkeeping, as virtual bookkeepers can provide more specialized expertise, better communication, and work more collaboratively. Accounting firms should carefully evaluate the tradeoffs between cost and quality when choosing between outsourcing and virtual bookkeeping services.

3. How do USA accounting firms integrate virtual bookkeepers into their services?

Accounting firms are partnering with virtual bookkeeping service providers to offload repetitive bookkeeping tasks. This allows the firms to offer clients the benefits of automated accounting software combined with professional bookkeeping expertise, without the overhead of maintaining an in-house bookkeeping team.