Author’s Note: This post was updated on February 23, 2022, with new information, links, and resources.
Bookkeeping is vital to the success of every business, but business owners rarely have the time (or desire) to manage it themselves. Many small businesses save time by partnering with an online bookkeeping and accounting team. However, there are some key features to consider when selecting online bookkeeping services for your small business.
What Is Online Bookkeeping?
Online bookkeeping, also called virtual bookkeeping, means managing your bookkeeping remotely.
A virtual bookkeeper works directly with your business to manage your company’s accounting and financial reporting. Typically, your company’s financial activity, records, and transactions will be stored in cloud-based accounting software that you are able to easily access.
An online bookkeeper will initially undergo a consultation with you to understand the needs of your business and your regular financial activities. Then, they can set up a system to generate sales invoices, manage accounts payable, and process payroll. With the right online bookkeeper, you can regularly view your company’s financials and make strategic business decisions. How do you choose the right financial partner for your business?
There are many options available, ranging from traditional CPAs to tech-savvy online providers.
Today, we will take a look at two popular options: Xendoo Online Bookkeeping and Bench. Both provide quality bookkeeping and tax services, but there are some key differences in features that may tip the scale for you:
- Online bookkeeping and tax services
- Additional services
- Accounting software
- Free trial
In this blog post, we will explore these differences so that you can make the best choice for your business.
Online Bookkeeping Services and Taxes
Xendoo’s online bookkeeping and tax packages start at $295, with a bookkeeping-only plan that starts at $195 per month. We reconcile your books weekly, and deliver your reports as early as the 5th business day of the month, depending on the plan you select.
Bench offers three bookkeeping and tax plans, with prices starting at $299 per month ($249/annual). Bench’s Core package requires a partnership with LendingClub. You can connect your existing bank accounts and debit cards on the Flex and Pro plans, which are more expensive. Tax services are available on all plans, but they do not offer a bookkeeping-only package at this time.
What Services Do Virtual Bookkeepers Offer?
You may also want to consider what other financial services your business needs. A virtual bookkeeper offers a wide range of services. These may include any of the following:
Your company may have many cash transactions throughout the month. These can include payments, receipts, and other items. A virtual bookkeeper can connect your cash and lines of credit with your accounting system to record transactions as they occur automatically.
Accounts Receivable Management
As a business owner, you likely don’t have a lot of time to chase down overdue payments from your customers. Instead, your focus is on growing and managing your business. A virtual bookkeeping service can assist you with client account collections and ensure that any significantly overdue accounts are brought to your attention immediately.
Accounts Payable Management
Rather than relying on what you think you have incurred in expenses for the month, you can allow a virtual bookkeeper to record actual and expected expenses. This approach allows you to strategically plan your outgoing cash flow for the upcoming weeks.
Cash Flow Management
Cash flow management tracks the money that you have coming into and out of your business. Online accounting services should provide a clear picture of your cash flow. Simply put, money coming in from revenue should be greater than money going out for employee pay, vendors, tools, and other expenses.
Accurate financial reports are an important part of the monthly accounting process. Xendoo’s financial reports include profit and loss statements and balance sheets. Plus, you can view reports from anywhere with the mobile app.
Frequently, online bookkeeping services will offer tax preparation services. This service can save you a lot of time and effort. You can also make sure that your tax return will be completed by someone who understands your company and its financial performance.
What if you are behind on your bookkeeping? Outside of the ongoing subscriptions, Xendoo and Bench offer catch up bookkeeping services so you can get previous months’ books in order!
There are a number of online accounting software systems available. The most popular include QuickBooks Online and Xero. Both of these services are cloud-based, with modern user interfaces that are easy to interpret. They integrate with a number of third-party applications, which gives them greater functionality.
Prices for both systems are much less than you would pay for a full ERP. However, both systems allow for a wide range of reporting tools that are perfect for small business accounting.
They have the ability to reconcile cash accounts and provide accurate accounts receivable and payable reports. You may also generate a full set of financial statements for monthly reporting purposes.
The biggest difference between Xendoo and Bench is the software used to do your bookkeeping and accounting.
Xendoo works with both Quickbooks Online and Xero. The biggest advantage of these two programs is that you own the software. Working with Quickbooks Online and Xero, you will always have access to your financial records, no matter who does your bookkeeping.
Bench only uses its proprietary software, which does not integrate with any other accounting programs. If you ever need to leave Bench, your records will not go with you and your financial history will have to be rebuilt. If you want to be able to hold onto your data, Bench may not be the best choice for your business.
Try Us Out
Xendoo offers a free trial. The online accounting team completes your books from the previous month and provides a Profit and Loss Statement and Balance Sheet.
What happens if Xendoo is not the best fit for you? In that case, we will gladly connect you with others in our network so you can find your ideal financial partner. The completed books and financial reports are yours to keep in your QuickBooks Online or Xero subscription!
If you decide not to work with Bench, you can hold onto the financial reports, but you will no longer have access to the previous month’s bookkeeping as it is done in their proprietary software.
We’ve done a detailed Xendoo vs Bench comparison, but we’ve highlighted key differences in the chart below:
*Some options may only be available on certain plans.
Who Is Right for You?
It depends! Every business owner needs their bookkeeping done, and they deserve the freedom to take their data with them. Xendoo Online Bookkeeping works with industry-standard accounting software, ensuring you will always have access to your financial records and data.
Are we a fit for your business? Schedule your free consultation today!