Consolidation is the key to efficiency— but only to a point! When organizing your company’s financial records, you’ve likely considered entrusting multiple tasks to the same professional. Perhaps you wanted to let your tax preparer take care of bookkeeping as well as taxes, or assign bookkeeping to your accountant. But while this can simplify your finances and cut costs in the short term, it creates a host of problems down the road, which you’re better off avoiding.
Bookkeepers vs. Tax Preparers
At first glance, tax preparers and bookkeepers seem similar. Both are in charge of maintaining and organizing financial records. Thus you may be able to save some money on bookkeeping by getting your tax preparer to do it rather than paying a bookkeeper separately, though this benefit is reduced by the fact that tax preparers often charge more for bookkeeping services.
Even with these short-term savings, assigning bookkeeping to a tax preparer is not worthwhile. Tax preparers do not specialize in bookkeeping. They spend their time focused on understanding the tax code and thus tend to know less about maintaining and organizing records that aren’t directly related to taxes. As a result, there is a heightened chance that they will make mistakes or record your company’s financial information in a way that is difficult to understand. This could potentially cause you to spend more money than you have, miss out on chances to cut costs, or otherwise weaken your financial position. None of these problems are worth the small savings of not paying a bookkeeper.