Startups and small businesses have to watch their money closely. Startup bookkeeping is what tells you where the money went and whether you can afford the next hire.
The problem is that it takes hours every week, and those hours come out of the time you’d spend on the business itself. That’s why a lot of founders hand bookkeeping to a virtual assistant. The assistant keeps your accounts and transactions accurate and current, so the numbers are ready when you need them for a report or a tax filing.
Magic matches you with a virtual assistant who already knows the data entry work and the tools you use. Here’s what bookkeeping for startups covers and what to look for when you hire.
Key takeaways
Bookkeeping is the daily record of what your business earns and spends. It feeds every report an investor, lender, or tax agency will ask you for.
A bookkeeping assistant handles data entry, invoices, accounts payable and receivable, bank reconciliation, and payroll records.
The skills to check for are attention to detail and hands-on knowledge of your accounting software, usually Quickbooks or Xero.
Hire one when the books are taking too much of your week or your taxes have gotten complicated.
What Are Bookkeeping Services?
Bookkeeping services keep a record of a business’s daily financial affairs in organized accounts. That covers every transaction and event that moves money in or out.
Traditional bookkeeping means recording transactions in accounting books. A virtual bookkeeper updates the same records digitally instead. Business collaboration tools made it possible to run bookkeeping for a startup with someone working remotely, at a lower cost than an in-house hire.
Here’s what a bookkeeping assistant typically takes on.
| Service | What it covers |
|---|---|
| Data entry | Recording transactions, receipts, and expenses into your accounting software |
| Accounts payable | Tracking what you owe suppliers and vendors, and flagging bills before they’re due |
| Accounts receivable | Tracking what clients owe you, sending invoices, and following up on late payments |
| Bank reconciliation | Matching your books against bank statements to catch missing or duplicate entries |
| Payroll records | Maintaining pay records, hours, and deductions for the payroll run |
| Tax preparation support | Organizing the records and receipts your accountant or tax filer needs |
What a Bookkeeping Assistant Does for Your Finances
A business runs on how accurate and organized its records are. A virtual assistant bookkeeper maintains your ledgers and tracks every dealing so you can see your cash position at any point. Here’s what that looks like day to day.
1. Financial Records and Statements
Accurate reports let investors, banks, and analysts read the financial health of your business. Getting there starts with clean journal entries, which is the part a bookkeeping assistant handles.
| Statement | What it tells you |
|---|---|
| Balance sheet | What the business owns and owes on a given date |
| Income statement | Revenue, costs, and profit over a period |
| Statement of cash flows | Where cash came in and went out, separate from profit on paper |
| Bank reconciliation statement | Whether your books agree with what the bank actually recorded |
With the books current, you can compare what you planned against what happened and adjust from there.
2. Invoices and Prompt Payments
Bills and invoices need to go out and get paid on time so you avoid surcharges and keep service subscriptions active. Receivables are also the money you’re counting on, so they have to stay in order.
A bookkeeping assistant tells you which clients owe you money and how much, so overdue accounts can be handed to whoever chases them. They’ll also keep track of recurring bills, including office equipment and software, bank fees and interest, rent and utilities, insurance, membership dues, commissions, advertising, subscriptions, and legal fees.
If you’re in retail, finance, or manufacturing, credit control is another piece of this. It usually sits with a risk management committee, and your assistant can do the monitoring that keeps bad debt down.
3. Tax Preparation and Management
Most business owners dread tax season, and plenty go into it without knowing what they owe until the deadline is close.
A bookkeeping virtual assistant keeps the underlying records organized through the year, so quarterly and annual filings don’t turn into a scramble. Your accountant or tax filer gets clean books instead of a box of receipts.
Read More on This Topic: The Bookkeeping Services List You Need for Financial Efficiency
No commitment
Meet your assistant before you pay anything
Magic handles the sourcing, screening, and onboarding. You aren’t charged until you start working together.
What to Look For When Hiring a Virtual Bookkeeping Assistant
A bookkeeping assistant with solid data entry skills needs little supervision. Here are the qualities worth checking for before you hire.
| Skill | What to look for |
|---|---|
| Attention to detail | They catch errors on the first pass instead of redoing work later. This is the difference between a reconciliation that takes an hour and one that takes a day. |
| Software knowledge | Comfortable in Quickbooks, Xero, Excel, word processors, and databases. Ask for a short test in whichever one you actually use. |
| Communication | Correct grammar and spelling in the records themselves, plus the ability to explain a payroll or tax filing question clearly on a call or in writing. |
| Typing speed and accuracy | They can get through a day’s volume without introducing errors that someone has to correct later. See the benchmarks below. |
| Research and data collection | They can chase down a missing receipt or an unmatched line item without being walked through it. |
| Collaboration | They listen and own their mistakes rather than leaving them for you to find. |
| Organization | They know when each report and payment is due and keep files sorted so anything can be found again. Calendar management is part of this. |
Typing Benchmarks Worth Testing
Data entry is a volume job, so speed and accuracy both count. Here’s where the common benchmarks sit.
| Measure | Benchmark |
|---|---|
| Basic data entry speed | 40 words per minute |
| Average typing speed | 50 words per minute |
| Good typing speed | Around 70 words per minute, per Chron |
| Typing accuracy | 92 percent, per Ratatype |
Give candidates a short data entry test using your own software and a real batch of transactions. A typing score only measures speed, so watching someone work through real entries in Quickbooks or Xero is the better signal. Accurate financial records depend on both.
When to Hire a Bookkeeping Assistant for Your Startup
Founders usually handle the books themselves at the start. Here are the signs it’s time to hand the work off.
Accounting Is Taking Too Much of Your Week
Proper records take hours, and those hours come out of the work only you can do. If you’re spending your evenings in a spreadsheet, an assistant covering the bookkeeping buys that time back.
Your Taxes Have Gotten Complicated
Multiple clients and income streams mean more forms, more deductions to sort out, and more chances to get it wrong. A bookkeeping assistant keeps your payroll and tax records current so filing season isn’t a research project.
Your Business Is Growing
Plenty of SME and startup owners hold off on outsourced bookkeeping services because of cost. Once volume picks up, the math changes. You can run the numbers with our cost savings calculator.
An assistant keeping the day to day records in order also frees your CPA to spend their time on the complex work you’re paying them for. You can scale the support up or down as your needs change.
Get Bookkeeping Support From Magic
Magic matches you with an assistant based on the tools and tasks you need covered. We source and screen the talent pool, so you skip the hiring process. Assistants work from the Philippines and Latin America on US hours. Billing runs every four weeks and there’s no long-term contract.
Take a look at our pricing, read through client reviews, or check the hiring guide to see how onboarding works.
Get started
Hand off the books to one assistant.
Magic sources, screens, and onboards them. You meet them first, and you aren’t charged until you start working together. No long-term contract, cancel anytime.
