Managing your business finances can quickly become overwhelming when you are also responsible for sales, customers, employees, and daily operations. A virtual bookkeeper can take care of your financial records remotely, giving you more time to focus on growing your business.
Unlike a traditional in-house bookkeeper, a virtual bookkeeper works through secure online systems and accounting software. This makes professional bookkeeping accessible without the expense of maintaining a full-time employee and office infrastructure.
If you are considering whether to work with a virtual bookkeeper, this guide explains how virtual bookkeeping works, its benefits, what services you can expect, and how to choose the right provider.
What Is a Virtual Bookkeeper?
A virtual bookkeeper is a professional who manages bookkeeping tasks remotely using cloud-based accounting software and secure digital communication. Instead of working from your office, the bookkeeper can access authorized financial information online and complete routine accounting tasks from virtually anywhere.
For example, a virtual bookkeeper may manage:
- Recording and categorizing financial transactions
- Bank and credit card reconciliation
- Accounts payable and accounts receivable
- Financial statement preparation
- Payroll-related bookkeeping
- Transaction reviews
- Book cleanup and catch-up work
- Cash-flow tracking
- Preparation of records for tax professionals
Accounts Confidant explains that its virtual bookkeeping process can include receiving financial documents, reconciling transactions, preparing statements, and delivering completed financial reports for review.
Businesses can therefore maintain organized books without having a bookkeeper physically present in the office.
Why Work With a Virtual Bookkeeper?
Working with a virtual bookkeeper can be particularly useful for startups, small businesses, growing companies, independent professionals, and businesses that do not need a full-time accounting employee.
1. Reduce Bookkeeping Costs
Hiring an in-house employee can involve salary, benefits, office space, equipment, training, and other employment expenses. A virtual bookkeeping arrangement can provide access to professional bookkeeping without requiring the same infrastructure.
Accounts Confidant specifically positions virtual bookkeeping as a cost-efficient alternative to maintaining an in-house resource.
This can allow a business to direct more resources toward marketing, operations, hiring, and growth.
2. Keep Your Books Up to Date
Outdated books can make it difficult to understand how your business is performing. Regular bookkeeping helps ensure that transactions are recorded and accounts are reconciled consistently.
Updated financial records can help you understand:
- Current income and expenses
- Outstanding invoices
- Vendor obligations
- Cash-flow trends
- Business profitability
- Potential financial problems
For businesses that need broader support, professional outsourced accounting services can combine bookkeeping with other financial functions.
3. Save Time
Bookkeeping can consume hours that business owners could otherwise spend serving customers or developing the company.
When a virtual bookkeeper manages routine financial tasks, you can spend more time on activities that directly contribute to business growth.
The goal is not simply to remove bookkeeping from your to-do list. It is to create a reliable financial process that gives you access to useful information when you need it.
4. Get Better Financial Visibility
Accurate books provide the foundation for useful financial reports. A virtual bookkeeping team can organize transactions and prepare reports that help you understand your financial position.
Accounts Confidant highlights updated financial information, regular reporting, cash management, and informed business decisions among the benefits of professional bookkeeping.
This information can help you make decisions about hiring, expenses, pricing, expansion, and cash management.
5. Access Professional Accounting Technology
Virtual bookkeepers commonly work with cloud-based accounting platforms and digital document-sharing systems.
Accounts Confidant states that its team works with financial software including QuickBooks, FreshBooks, Sage, and other accounting applications.
This can be useful when your business already uses accounting software but needs an experienced professional to maintain the books.
What Does a Virtual Bookkeeper Do?
The exact responsibilities depend on your business and service agreement. However, common virtual bookkeeping tasks include:
Bank Reconciliation
The bookkeeper compares your accounting records with bank statements to identify discrepancies and ensure transactions have been properly recorded.
Accounts Payable
Accounts payable management helps businesses organize bills, track vendor obligations, and maintain records of payments.
Accounts Receivable
Accounts receivable involves tracking customer invoices and outstanding balances. Professional accounts receivable services can help businesses organize invoicing and monitor customer payments.
Financial Statements
A virtual bookkeeper can help prepare financial statements such as income statements and balance sheets based on properly maintained accounting records.
Payroll Support
Payroll bookkeeping may include recording payroll transactions, maintaining payroll-related records, and coordinating payroll information.
If payroll is a significant part of your operations, payroll processing services can be considered as part of a broader outsourced accounting solution.
Book Cleanup
You do not necessarily need perfect books before hiring a virtual bookkeeper. A professional may be able to review historical transactions and organize missing or inconsistent records.
Accounts Confidant states that bookkeeping cleanup can be included in its work estimate and that its team can help establish an industry-specific general ledger.
Virtual Bookkeeper vs. In-House Bookkeeper
The biggest difference is how the service is delivered.
An in-house bookkeeper works directly from your business location and is generally part of your internal team. A virtual bookkeeper performs the work remotely using online accounting systems.
| Feature | Virtual Bookkeeper | In-House Bookkeeper |
|---|---|---|
| Work location | Remote | Usually on-site |
| Office space | Generally not required | Usually required |
| Employment overhead | Potentially lower | Typically higher |
| Access to specialists | Can involve a team | Usually one employee |
| Cloud accounting | Commonly used | Depends on business |
| Scalability | Can be flexible | May require additional hiring |
The right choice depends on your transaction volume, business structure, budget, accounting requirements, and preferred workflow.
How Does Working With a Virtual Bookkeeper Work?
The process can be straightforward when responsibilities and access are clearly established.
Step 1: Discuss Your Bookkeeping Needs
Start by identifying what you need help with. You may only need monthly bookkeeping, or you may require reconciliation, accounts payable, accounts receivable, payroll support, and financial reporting.
Step 2: Provide Financial Information
Your bookkeeper may receive documents through email, cloud storage, accounting software access, or another secure system.
Accounts Confidant describes a process in which clients can provide documents by email, give access to financial software, or upload files to a drive.
Step 3: Bookkeeping Begins
The bookkeeping team organizes transactions, performs reconciliations, maintains records, and completes the agreed-upon accounting tasks.
Step 4: Review Financial Reports
Once the books are updated, you can review the reports and ask questions about unusual transactions or financial trends.
Step 5: Maintain a Regular Schedule
Bookkeeping works best when it is performed consistently. Depending on the business, bookkeeping may be completed weekly, biweekly, or monthly.
How Much Does It Cost to Work With a Virtual Bookkeeper?
There is no single price for virtual bookkeeping. The cost can depend on:
- Number of monthly transactions
- Number of bank and credit card accounts
- Payroll requirements
- Accounts payable and receivable volume
- Business complexity
- Cleanup or catch-up requirements
- Accounting software
- Reporting requirements
- Frequency of bookkeeping
A small business with straightforward transactions may need a simpler service than a company with multiple entities, employees, high transaction volume, and complex financial reporting.
Instead of choosing a provider solely based on price, compare the scope of work, communication process, reporting, technology, security practices, and experience with businesses similar to yours.
Is It Safe to Work With a Virtual Bookkeeper?
Security should be one of the most important considerations when selecting a virtual bookkeeping provider because financial records contain sensitive business information.
Before granting access, ask how the provider handles:
- User permissions
- Passwords and authentication
- Financial documents
- Cloud storage
- Data transmission
- Employee access
- Account permissions
- Backup procedures
Accounts Confidant states that access restrictions can be applied to financial information and describes the use of SSL encryption for communication.
You should also provide only the level of accounting access required for the bookkeeper’s responsibilities.
How to Choose the Right Virtual Bookkeeper
Before hiring someone, consider the following questions:
- What accounting software do they support?
- Do they understand your industry?
- What bookkeeping tasks are included?
- How frequently will your books be updated?
- How will you communicate with the bookkeeping team?
- What financial reports will you receive?
- How is your financial information protected?
- Can they handle bookkeeping cleanup if necessary?
- Can the service scale as your company grows?
- Can they work with your existing CPA or accountant?
A virtual bookkeeper does not necessarily replace your CPA. In fact, organized books can make it easier for your accountant or tax professional to perform their work.
Can a Virtual Bookkeeper Work With Your Existing Accountant?
Yes. A virtual bookkeeper can maintain and organize your financial records while your CPA or accountant handles tax preparation, tax planning, audits, or other professional responsibilities.
Accounts Confidant’s FAQ notes that businesses can use a virtual bookkeeper alongside an existing accountant to organize and streamline their books.
This creates a useful division of responsibilities: the bookkeeper maintains the records while the accountant can focus on higher-level accounting and tax matters.
When Should You Hire a Virtual Bookkeeper?
You may want to consider hiring a virtual bookkeeper when:
- You are spending too much time on bookkeeping.
- Your financial records are falling behind.
- Bank reconciliations are not being completed regularly.
- You have difficulty tracking unpaid invoices.
- Your business is growing quickly.
- You are preparing for tax season.
- You need reliable financial reports.
- You have multiple business activities or entities.
- You need accounting expertise without hiring a full-time employee.
If your bookkeeping has already fallen behind, outsourcing can also provide an opportunity to organize historical records and establish a sustainable bookkeeping routine.
Final Thoughts
Choosing to work with a virtual bookkeeper can give business owners access to professional bookkeeping support without requiring a traditional in-house accounting setup. From transaction categorization and reconciliation to financial reporting, accounts payable, accounts receivable, and payroll support, a virtual bookkeeping team can manage many of the financial tasks that consume valuable business time.
The most important step is choosing a provider that understands your business, uses appropriate accounting technology, communicates clearly, protects your financial information, and can scale with your needs.
For businesses looking for a broader solution, virtual bookkeeping services from Accounts Confidant cover bookkeeping, reconciliation, financial statements, payroll processing, and tax-related support.
You can also review the company’s how virtual bookkeeping works to understand its workflow from receiving financial documents through completing bookkeeping and delivering reports.
Frequently Asked Questions
What is the best way to work with a virtual bookkeeper?
The best approach is to establish clear responsibilities, provide secure access to the required financial information, agree on a bookkeeping schedule, and regularly review financial reports. A defined workflow makes remote bookkeeping easier to manage.
Is hiring a virtual bookkeeper worth it for a small business?
Yes, it can be worthwhile when bookkeeping takes significant time away from running the business or when financial records are becoming difficult to maintain. A virtual arrangement may also provide professional support without the infrastructure associated with an in-house employee.
How do I find a reliable virtual bookkeeper for my small business?
Look for experience with your industry, familiarity with your accounting software, transparent service terms, strong communication, appropriate security practices, and a clear explanation of what the bookkeeping package includes.
Can I hire a virtual bookkeeper if my books are a mess?
Yes. Ask whether the provider offers bookkeeping cleanup or catch-up services. Some bookkeeping teams can organize historical transactions and establish a cleaner accounting system before moving to ongoing bookkeeping.
Can a virtual bookkeeper work with QuickBooks Online?
Yes. Many virtual bookkeepers work with cloud accounting platforms such as QuickBooks Online. Before hiring one, confirm that the provider supports your specific accounting software and understands the workflow you currently use.
What does a virtual bookkeeper do every month?
Monthly responsibilities can include transaction categorization, bank and credit card reconciliation, accounts payable and receivable tracking, bookkeeping adjustments, financial statement preparation, and management reporting.
Can a virtual bookkeeper handle accounts payable and receivable?
Yes. Depending on the service agreement, a virtual bookkeeping team can help track vendor bills, customer invoices, outstanding balances, and payment activity. Accounts Confidant lists both accounts payable and accounts receivable among its virtual bookkeeping services.
Should I hire a virtual bookkeeper or an accountant?
It depends on your needs. A bookkeeper generally focuses on maintaining accurate financial records and completing routine accounting tasks, while an accountant may provide tax, financial analysis, planning, or other higher-level services. Some businesses use both.
How often should I meet with my virtual bookkeeper?
There is no universal schedule. Monthly communication may be sufficient for a straightforward business, while businesses with higher transaction volume or complex finances may benefit from weekly or biweekly communication.
Can a virtual bookkeeper help during tax season?
Yes. Keeping your books organized throughout the year can make tax preparation easier because your financial records are more current and structured. A bookkeeping provider may also coordinate records with your tax professional.
What should I give my virtual bookkeeper?
Depending on the engagement, you may provide access to accounting software, bank and credit card information, invoices, receipts, bills, payroll records, and other financial documentation. Only provide the access necessary to perform the agreed services.
How can I tell if my business needs a virtual bookkeeper?
If bookkeeping is taking you away from core business activities, your records are consistently behind, reconciliations are incomplete, or you cannot easily determine your current financial position, it may be time to consider professional bookkeeping support.
Can a virtual bookkeeper replace my CPA?
Not necessarily. A virtual bookkeeper and CPA can have different responsibilities and can work together. The bookkeeper can maintain organized financial records while your CPA handles tax, accounting, audit, or advisory responsibilities that require their professional expertise.
