For any business to be a success, its financial records should be well handled and recorded.
This is known as bookkeeping in accounting terms.
The reason why bookkeeping is so important is because it is the accounts of the company that is always turned over whenever business decisions are required to be made by the managers.
Now, bookkeeping is not as easy as it seems.
Experienced entrepreneurs tell by experience that the company's success or failure is determined by its bookkeeping measures.
If a company is not maintaining its transaction and investment records, it surely will have no reference to them later in terms of any difficulties related to the business.
Also, if the bookkeeping records are not maintained properly, then there is risk of a complete business failure, again due to lack of reference.
Thus, in a company, bookkeeping is as important as any other aspect in its business.
For proper bookkeeping all financial transactions, income and expenditure of the company is recorded in the books of it and is needed to be regularly updated.
For a small business, the managers themselves maintain their own books, but for a large company it becomes difficult for a single manager to maintain it, as it is a very big responsibility.
Any wrong or irresponsible entry can put a company into a big loss and can also make it difficult for the entrepreneurs later to access the records.
Thus companies try measures like hiring a part time or a full time bookkeeper or even a freelancer for bookkeeping.
This not only frees them from the stress of tedious bookkeeping measures and saves their precious time, but also helps keep accurate records in their books.
But it is increasingly becoming very difficult to find good bookkeepers for a full time job.
Also there is a major problem with freelance bookkeepers as references play a crucial role in bookkeeping.
All finances and private data of the company must be accessed by the bookkeeper in order to keep the records.
So, the company must give full rights to the freelancer to view records at any level.
This is often not agreed upon by companies owing to its security and privacy measures.
Nowadays most companies are outsourcing their bookkeeping of their business to an external vendor who professionally does the work for the company.
As bookkeeping records have become computerized now, the raw data is transferred to the vendor.
The vendor compiles and processes the records of daily transactions and sends it back to the company.
Also much of the companies expenses are saved by outsourcing bookkeeping, because these vendors charge much less than hired professionals.
Apart from this, they are experts in their fields and hence do the work very well.