Do you think your firm should go online-only? Here are a few things to consider about becoming a virtual accountant.
Starting a virtual accounting firm offers flexibility and the freedom to work where and with whom you want. You can start a virtual accounting firm by learning what you need to know about becoming a virtual accountant, the benefits of doing so, and how to do so.
What Is a Virtual Accountant?
A virtual accountant is simply an accountant who works online rather than in an office. As a result of leveraging cloud accounting software and mobile apps, they offer a range of accounting services to small businesses and self-employed individuals, including:
Bill pay services
Accounts receivable and accounts payable
Preparing financial reports and financial statements
Tax filing services
Virtual CFO services
Cash flow forecasting
Advice on business processes
What Does It Take To Become a Virtual Accountant?
You need a variety of qualifications to become a virtual accountant, depending on what services you plan to offer. A college degree or professional certification is not necessary if you are planning to provide basic bookkeeping services. All you need is relevant experience and knowledge of accounting and bookkeeping principles.
However, if you plan on offering higher-level accounting services, like representing clients in IRS or other tax authority audits, auditing financial statements, or providing outsourced CFO services, you must have a college degree.
How Do Virtual Accountants Work With Clients?
A virtual accountant’s office can be located anywhere with an internet connection and a laptop or mobile device.
Whether they communicate via phone, email, video conference, or messaging platforms such as Microsoft Teams and Slack, virtual bookkeepers and accountants are able to keep track of their finances virtually.
Through cloud-based software, they collaborate and provide bookkeeping and tax preparation services. Often, they send and receive documents, including receipts, bank statements, financial reports, and other records, via a secure online portal rather than sending paperwork through the mail.
Benefits of Starting a Virtual Accounting Firm
Providing virtual bookkeeping services isn’t for everyone, but it has several advantages.
LOW OVERHEAD COSTS
Maintaining an office space is expensive, as is renting, furnishing, and maintaining it. Virtual accountants can reduce costs by working from home. Unlike traditional offices, virtual offices require less investment in technology and security, but they’re more cost-effective than brick-and-mortar locations.
It is possible to spend hours of your day commuting, depending on where you live. The flexibility of virtual accounting allows you to work from home, a hotel room, a coworking space, or a coffee shop. With your office wherever you are, you don’t spend hours commuting or driving to clients’ offices.
LOW STARTUP COSTS
It is far less expensive to start a virtual accounting firm than a local accountant office. Virtual bookkeeping offices do not have to worry about renting, building, decorating, or furnishing an office, which is one of the expenses that an accounting firm typically faces. Starter Story estimates an average startup cost for an accounting firm at $19,815.
A Step by Step Business report states that the average online accounting firm incurs the following expenses:
Setting up a business name and incorporating: $175
Business licenses and permits: $200
Website setup, domain name, and hosting: $2,000
Initial marketing: $750
Computer hardware and software: $1,750
Unlike brick-and-mortar businesses, virtual bookkeeping has much lower startup costs.
LARGER CLIENT BASE
Accounting software and collaboration tools that work with cloud-based accounting systems have significantly improved accountants’ ability to work with small business owners. Working with small businesses in other locations is possible, but it involved sending files back and forth via mail or courier service – a time-consuming process that exposed client data to theft.
The best thing about working as a virtual accountant is that you can serve small and medium-sized businesses from anywhere in the world – all you need is an internet connection and the right software to do it.
How to Become a Virtual Accountant
When ready, follow these steps to set up your online business. Any questions regarding licensing or legal requirements should be directed to an attorney or advisor.
Make a decision about what services you will offer and what niche you will serve. Do you have any ideas about who you would like to work with, and what services you would like to provide? Once you’ve established yourself, you can offer more services to a larger audience.
Your business needs to be set up. Decide on your business name and legal structure, register your business with the government, and obtain any licenses you may need.
Don’t be afraid to invest in technology. Computers, cloud accounting software, and a secure portal for sending and receiving documents and financial reports are the minimum requirements. Remote clients can participate in “face-to-face meetings” with collaboration tools like Zoom or Microsoft Teams. Your business may grow and you’ll need tools to manage appointments, perform payroll, and track time.