What are the average bookkeeping costs for startups?
Can anyone advise what the average bookkeeping costs are for startup businesses?
Many bookkeepers and bookkeeping firms offer startup packages to help you launch your business and ensure your financials and accounts are set up properly. The services included will vary between firms but a basic bookkeeping package for startups typically includes:
A dedicated bookkeeper/account manager
Set up of standard chart of accounts
Accounting software training (e.g. for Xero, Quickbooks, MYOB, etc.)
A limited number of transactions per month (approx. 100)
Quarterly GST/BAS reporting
Startup bookkeeping packages usually start from around $300 per month. You might be able to add on different services for an extra fee depending on your needs. You can always upgrade your package as your business grows.
As a BAS Agent my firm has never offered a particular type of "startup package" that is generic.
Every business regardless of it's age is unique and is normally quoted on a case by case basis.
There are bookkeepers who "specialise" in startups and as such can offer competitive rates, but these are not the normal.
While it's true generically what Cliona has stated, in a real world situation as a bookkeeping firm owner, not all the points would be rolled into the small fee of $300 per month quoted above.
A dedicated bookkeeper / account manager
This is not always the case, nor should a customer expect it to be so at a cheaper monthly rate.
Set up of standard chart of accounts - absolutely
Accounting software is not always included, nor is it advisable.
If you as the business owner find you do not like the service the bookkeeper or accountant is providing you will wnat the flexibliity to keep your accountant software and move it to another firm.
Unfortunately, if your accounting/bookkeeping firm pays the subscription, they hold an additional amount of power over you as their customer. Do not pay their bill or leave on bad terms....getting your file might become more complicated.
A limited number of transactions per month (approx 100)
Lets use Xero starter as an example per month
20 invoices
5 expenses
This would mean the approximate limit of 100 is far more than would be allocated in any package.
Offshore bookkeepers charge per transaction and most firms here in australia do not have their staff count the transaction lines on a statement to quote the client a price.
It's normally priced depending on the services requested.
Quarterly GST/BAS Reporting
Not necessarily
Many bookkeepers work by the hour, or their fixed priced packages are scaled by the services provided. The more services on top of simply "bookkeeping" the price will increase.
Average cost $300 not realistic in my opinion.
In this climate with JobKeeper, government grants, keeping up to date with initiatives on a state and federal basis and satisfying compliance requirements as a BAS & TAX Agent $300 month including accounting software is not viable unless they use an offshore workforce in the Phillipians.
An Accounting / bookkeeping firm with Australian staff would have to charge much more than that per month to cover their overheads + turn a little profit at least.
Hey @Eloah Paes Ramalho you can always switch accountants, but as with everything there is usually a bit of "pain" (time, energy, etc.) associated with the move - so with some planning you can minimise the discomfort. No doubt if a business grows large, they will switch accountants because the advice and support needed when your busineiss is doing $500,000 in sales is very different than when your business is doing $10 milliion in turnover.
Determining which bookkeeper or accountant can grow with your business requires you to envision what your business will be like in the future (next 3, 5 or 10 years) and evaluate if they have experience working with companies of that size in your industry.
Monthly bookkeeping prices for a small simple startup business usually start around $300 per month and increase as the business grows. At that price you are likely to receive:
- set up of the standard chart of accounts in the software (eg. Xero, QuickBooks, etc.)
- a limit of 100 transactions each month (eg. bank / credit card transactions coded by the bookkeeper)
- possibly payroll for the owner using the bookkeeping software (eg. fortnightly salary payroll and Single Touch Payroll processed in the software)
- GST coding on transactions, if applicable
- keeping copies of supplier bills / receipts to support GST claims and for a potential tax audit
- lodging BAS / GST returns which could also include PAYG Witholding on payroll
- following up on unpaid customer invoices via email or phone
- managing the accounts email address
- preparing supplier payments
I don't know if others can relate but I get quite overwhelmed by the accounting lingo. I wish there were a 15min crash course just to distinguish the most important principles and tools.
This last paragraph is really valuable, @Dan Cadieux ! How do you determine which accountant is able to grow with your business? Why not switch accountants as your business grows?
Eloah Paes Ramalho, Community Manager at SavvySME
Such a hearty response, @Amanda Hoffmann - Certified Bookkeeper, BAS Agent ! Thank you for that!
I get you said each business is unique, and it's hard to generalise.
What, in your opinion, are the minimum accounting requirements for a business as it moves from the start-up phases into a established business?
What would you advice someone who's starting hires, and then down the line what would be some important markers to consider up-leveling their accounting game?