Why Virtual Bookkeepers are Safer than an In House Bookkeeper

Many companies are starting to outsource their bookkeeping roles to virtual bookkeepers and for many good reasons. Outsourcing your bookkeeping can save a company allot of money over having an in-house employee, but did you also know that it introduces some very beneficial checks and balances to your accounting practices?

Accounting fraud can cost small businesses allot of money, and to lessen or avoid the potential for fraud a company would need to hire more than one person in order to separate duties which would drastically increase costs. Having an in-house bookkeeper also means that they have access to petty cash, checks, and may have friendships with other employees in the firm that they could collude with.

Hiring a virtual bookkeeper automatically introduces separation of duties as a check and balance since you are hiring a bookkeeper that has nothing to do with your business and doesn't have relationships with other people in the organization that they could collude with. Your virtual bookkeeper is setup with the appropriate access to your online bookkeeping software and is given the appropriate access to do their job and no more. They receive transactions from bank feeds, and they do not have access to these accounts. They also receive transactions via a receipt bank such as Hubdoc that have been scanned and submitted by people in the organization. Your virtual bookkeeper does not favor any employees and only categorizes the transactions as per the chart of accounts. The virtual bookkeeper provides the company with reporting that shows that all accounts have been reconciled correctly and denote any deviations in journal entries.

One of the easiest places in-house employees can steal money is out of the petty cash. A dishonest in-house bookkeeper may be able to take money from petty cash and create a transaction to cover up the theft. A virtual bookkeeper, however, does not have any access to petty cash and will get approval for all petty cash withdraw requests that they receive. This will alert in-house management much sooner to any petty cash withdraws that may have been made dishonestly.

Printing checks and approving checks can also be an area where your accounting system may be compromised by a dishonest employee. If one person is given access to print checks and approve them, they could easily print and approve their checks, or they could collude with someone internally? Your virtual bookkeeper will not have access to print checks either. If you do contract them to do accounts payable as an add-on service, they will use a third party provider and them internal manager will be the only one who can approve payments. 

Hiring a virtual bookkeeper will not only save you money, but it will also add some important checks and balances by automatically introducing separation of duties, removes contact with petty cash, and removes the ability to approve and print checks on your accounts. Hiring a virtual bookkeeper like Servant Bookkeeping Solutions can save you money and reduce the chance of fraud thereby helping your business to be successful!