The Bookkeeping Woes
Maybe it's because I have a background in bookkeeping but I am seeing a lot of companies that do not keep proper books. I was recently approached by a small property management company that wanted to merge into my company. I very much considered this to be a great opportunity to expand our already busy company and reach more clients to do full cycle real estate.
I was excited about this amazing opportunity!
My OCD mind soon kicked in and I asked to do an audit of the books. I wanted to make sure all our state laws for property management bookkeeping were being followed. Sadly what I found was a bookkeeping nightmare...no honestly, I have been having nightmares!
I have devoted over 30 hours in the past week fixing the bookkeeping. We, my business partner and I, decided that it was best to have her hire me as and independent contractor for bookkeeping and encourage her to grow her company prior to us merging. As it stands now, with what she is requiring for pay and the state the books were in there would be no profit for us and we would be taking on a huge liability with the current bookkeeping situation.
So for now, I am a full-time broker and business owner and a full-time bookkeeper on top of raising two teenage boys and trying to some how resemble being an adult.
I guess what I am getting at, is if you are not capable of keeping your books accurate, please for your own peace of mind hire someone to help you, it's so worth it. Plus it helps at tax time to have your books in order from the start...so you can pay those taxes I hear a lot of brokers don't pay...but thats for another blog.
Comments (2)
Yep, I hear you. Bookkeeping is very useful and I'm only starting to feel good doing it for myself now. I use Wave because it's free and good for freelancers. Their accounting coach brought me up to speed, and I used a licensed CPA/Bookkeeper to check my homework.
@Minna Hu - A bookkeeper categorizes transactions, makes sure your books are balanced, checks to see if something is an asset or liability. Reports such as Profit and Loss, Balance Sheets, and other are generated from bookkeeping.
Kathy Li, almost 5 years ago
"So for now, I am a full-time broker and business owner and a full-time bookkeeper on top of raising two teenage boys and trying to some how resemble being an adult." LOL. your description is so accurate and interesting, I totally understand your situation.
I am currently doing all bookkeeping of our real estate business, spending 8 hours per month, sorting income and expense for existing rental properties and our ongoing construction project.
I want to focus more on investment and business development this year, thus delegating the bookkeeping part. I don't know how to start, in my opinion, the bookkeeper need to understand repairs and projects on going in order to do bookkeeping properly.
If you could share your experience, that would be great. What does bookkeeper usually do? And how do you contract it out? And what is the setup to delegate bookkeeping successfully?
Thank you.
Minna Hu, over 5 years ago