What are Virtual Bookkeeping Services, Exactly?

Now we have ushered in a new era where everything is becoming cloud-based and every person is becoming dependent upon the internet or online services. Nowadays, it is also attracting accounting or bookkeeping fields as most of the business houses demanding virtual accountants who will prepare Reports from their records through the cloud-based system only. In this article, we will deeply understand What the virtual bookkeeping exactly means, How it works and How we can get the benefit

Meaning of Virtual Bookkeeping: 

Bookkeeping is maintaining books of accounts and take them into the condition so that it can be used as financial statements and accepted by various statutory authorities and in the same way Virtual Bookkeeping is the process of maintaining financial records and accounts of a client without being physically visiting his location through computerized mode. In virtual bookkeeping, the accountant uses computerized software which is used by him to post financial transactions, update accounts and perform reconciliations.

How it works:

For Virtual bookkeeping, Business houses grant remote access to their servers, software and other financial documents of their organization using which virtual accountant performs his bookkeeping functions.

To perform this function, both the client (business house) as well as the accountant ( Virtual bookkeeper) must use the same servers and software so that proper transfer and smooth communication between both of them could be ensured. After this, a Virtual bookkeeper logs on to the client’s server to access various raw records saved by the client in their servers and start performing his job by converting that record into a proper financial report. In consideration of this service, a bookkeeper will get a salary as per the client’s payroll policy if he is virtually employed by the company for his services. On the other hand, if he is working as an independent contractor then he will issue an invoice on the name of the client and will charge consideration as per the contractor’s policy.

Why it is better than traditional bookkeeping?

Apart from getting financial records maintaining through remote access, there are several other needs of the clients from virtual accountants which altogether make it better from traditional bookkeeping. Major characteristics which should be present in virtual bookkeeping to make it better are discussed in the following points:

• Reliability: This is the most critical issue which usually may arise while working in a cloud-based environment. The client gives access to an accountant to its servers and his sensitive financial data and that’s why he is expecting ethical professional practice from the accountant also.

• Availability: This could be the most important benefit of working in the virtual environment. In traditional accounting system, the accountant needs to visit at client place which could not be possible most of the time as per client’s requirement but now, Skype meetings with the client, flexible working hours are some of the popular features which makes the accounting services to client readily available as and when required.

• Consistency: Due to flexibility in working timings, consistency would be there in meeting timelines of the closure of books at various month ends and year-end activities. Remote accounting saves time of both accountant and client and which ultimately results in the consistency in delivering financial statements on time.

What is your ultimate benefit from this?

Apart from reliability, availability, and consistency, there are several other basic requirement and expectation of clients from Virtual bookkeeping service providers. Generally following are the offerings of virtual bookkeeping service providers:

• Dedicated Team of Professionals: As there is no direct link between client and the accountant, so to ensure accuracy in work there must be dedicated team of professionals who have sound knowledge of Accountancy, bookkeeping, Taxation and other financial packages which are going to be used in client’s working so that error-free work can be delivered to the client.

• Regular updation of Books of accounts: This is the most important benefit as well as it is the topmost expectation of the client that there must be regular as well as timely updation of books of accounts so that Financial statements can be used timely by the users and the client can use it for fulfilling various statutory requirements without hindering any timeline.

• Focus on other core activities: If your bookkeeping or accounting department is in hands of the team of expert professionals, then, in that case, you will not need to worry about the accuracy and delivery of financials as it is being handled by expert and in that case, you can focus more on your other core business activities which will ultimately increase your productivity.

• Convenient: In any of the cases, if you and the accountant personally meet to discuss or complete a project then both of you will need to manage your time and meet at the same place which will result in inconvenience along with the killing of precious time also. On the other hand, if you are working in a cloud environment, you can complete these processes over skype or emails only which will result in convenience and on-demand assistance to your company also.

Scope of Virtual Bookkeeping in today’s era:

As discussed above, we can easily conclude from the benefits of virtual accounting that it is more effective than the traditional one. Time is also the most precious resource which could be saved by using this modern feature and the overall efficiency of the company could be improved.

If I talk about the scope, then I must tell you in our country, Virtual bookkeeping is performed not only for Indian clients but for virtual clients also. Many of the CA firms and Outsourcing Multinational Companies are doing the same for international clients also. Many of the young freelancer professionals also trying to make their space in this competitive environment.

By this, I can conclude that in the coming years virtual bookkeeping seems to be the only way to get our bookkeeping done as it is the solution to various problems which business houses are facing today by using services from in house accountants.