I have been freelancing for close to a decade, which includes handling my own small business bookkeeping.
Since I have no background in accounting, learning how to manage my books was not easy. And frankly, handling my own books is not my favorite part of my business. Not only does bookkeeping take time away from the income-generating work of pitching, researching, and writing articles, but I always have a nagging worry that I’m getting something wrong with my books.
Since I work for myself, I always assumed hiring a bookkeeper would be an expensive luxury for my business. So I’ve gritted my teeth and handled my own bookkeeping for nearly a decade.
Imagine my excitement when I learned that Bench.co could help me with my books. This startup based out of Vancouver assigns a dedicated bookkeeping team to each of its clients while keeping its monthly fees low. Enjoy all the benefits of a personal bookkeeper at a lower cost.
For small business owners and solo-entrepreneurs, Bench online bookkeeping service takes the headache out of financial paperwork. Starting at just $249 a month when billed annually, you will get a team of Vancouver based bookkeepers assigned to your account. They will do all your bookkeeping and send you reports monthly and at tax time.
Bench allows you to put your focus where it belongs: on growing your business.
Here’s what you need to know about how Bench.co can liberate you from the hours of bookkeeping tedium, keep your finances in order, and cost you less than traditional services:
Table of Contents
How Bench Works
When you sign up with Bench, the company immediately assigns you a dedicated bookkeeping team. Bench employs over 100 full-time bookkeepers who work out of their Vancouver headquarters. No need to worry that your bookkeeping services are routed through a call center located somewhere on the other side of the world. Your Vancouver-based team will work together on your business accounting.
From there, a member of your bookkeeping team will contact you. You will set up a time to chat over the phone with your team about your business and your accounting needs. This will help them know exactly what they’ll need to properly categorize your transactions and tailor your bookkeeping to your business’s unique needs.
Once you are established with your team, they will begin importing your business transactions each month. You can link up to 15 accounts, including bank accounts, credit cards, loans, and merchant account processors like Square, PayPal, and Stripe. The information from these accounts imports automatically to your Bench account. You will not need to send documentation yourself. The team will reach out to you if they need any more information or clarification.
Each month, your team will deliver a financial report on the 15th business day of the following month. Come tax time; you’ll also receive a full financial report for the year to make tax filing painless.
— Gus Wagner (@RocketGroup) February 29, 2016
What Your Bookkeeping Team Provides You
Signing on with Bench means that your bookkeepers will handle the following financial chores for you:
- Tracking and categorizing all of your business transactions.
- Collecting and digitally saving all of your necessary documents, such as receipts, banking and credit card statements, payroll reports, loan agreements, and the like. The program connects your bank and merchant processor accounts to Bench for seamless data transfer, meaning that in most cases, your bookkeepers will have all of the transaction information they need. If your team lets you know that they need an account statement or receipt from you, you can easily drag and drop it into the Bench program.
- Preparing accurate monthly financial statements, including any necessary month-to-month adjustments based on cash flow. You will receive your monthly financial statement on the 15th business day of the following month.
- Separating personal from business expenses.
- Tracking and producing a 1099 report that you can use to file your 1099s for your contract employees.
- Collating a full annual financial report/package that you can take to your accountant for tax filing. Your team will even work directly with your CPA to help you get your taxes filed. For an additional fee, Bench will also prepare and file taxes for you.
Since your transactions import to the team automatically, your Bench team can work in the background for you while you focus on growing your business.
In addition, Bench promises that your bookkeeper will respond to any messages or calls within one business day or less. This means you won’t spend a week chewing your fingernails if you have a concern.
On top of all this, your Bench bookkeeping team can catch up past years’ disorganized books for you. Bench charges an additional, custom cost for this Catch-Up Bookkeeping, but it offers relief to anyone worried about their less-than-organized old books. Specialized bookkeeping is also being offered for an additional charge if you need to track account receivable, account payable, or segment level bookkeeping.
Understanding the Accounting
Of course, not all accounting is the same, and it’s important to understand exactly what Bench is offering. To do that, you need to understand the two types of accounting: “cash basis” or “accrual basis.”
With cash basis accounting, transactions are only recorded when money directly changes hands. With cash basis accounting, you record the payment you receive as soon as it is deposited in your bank account. Similarly, you record the expense you pay as soon as it is debited from your account.
Accrual basis accounting records money when it is earned, but not necessarily when it is spent. For instance, you record a payment when you send an invoice rather than when you receive the money. You also record a debit when you receive a bill rather than when you pay the bill.
New entrepreneurs often choose cash basis accounting. It is easier to maintain, and it helps business owners understand exactly how much money they have at their disposal. In addition, since you don’t record your business income until it’s actually in your hot little hands (i.e., the bank), you don’t owe taxes until you have actually been paid.
Accrual basis, on the other hand, allows businesses to track accounts payable and receivable. This provides you with a better understanding of your overall business performance. That’s because you can keep track of trends in income and outflow more easily. However, you will owe taxes on recorded income, even if your invoices are still outstanding.
Bench offers a good explanation of the difference between these two accounting practices in this video:
Bench’s “Modified” Cash Basis Accounting
As of right now, Bench is unable to offer traditional accrual basis accounting to its clients. Instead, it offers what it calls “modified” cash basis accounting. In general, modified cash basis accounting records long-term assets on an accrual basis and short-term assets on a cash basis.
This means a modified cash basis accounting records your day-to-day income and outlay when money is deposited or debited from your account for ordinary transactions. This includes accounts receivable and inventory as part of the cash basis. However, if you have any long-term assets, such as fixed assets or long-term debt, these are included on your financial statement using accrual basis accounting.
Unless you are invoicing a number of clients, you don’t necessarily need accrual accounting. Anyone in the service industry (such as hairdressers, dog-walkers, mechanics, personal organizers, etc) gets paid at the time of service–which works perfectly with cash basis accounting. And freelancers generally only have a limited number of clients whom they invoice over and over again.
That said, some small businesses may need aspects of accrual accounting. In that case, your Bench bookkeeping team can record revenues and expenses when they are earned rather than paid. For instance, if you offer subscription services as part of your business, Bench can make transaction-based accrual adjustments to your accounts to track your subscription sales as you make them rather than as you are paid for them.
With this modified cash basis, Bench is unable to take care of invoicing, bill tracking, payroll, or inventory for you. However, Bench does partner with companies that specialize in these areas of financial administration, like Gusto and Freshbooks. Using Bench alongside one of their partner companies can ensure that your financial management remains simple and painless.
The Bench Platform
The company uses proprietary software for your bookkeeping. The good news is that the user interface for the client-facing part of this software is intuitive, attractive, and easy to use. The bad news is that this proprietary software is not compatible with other bookkeeping programs. You cannot easily import your accounting information from previously-used software, nor can you easily shift to a new platform if you decide to leave Bench.
Bench offers an iPhone app, but there is no corresponding Android app. However, you can access Bench through your mobile browser from your Android phone.
Your bookkeeping team can send you messages through the app or via email or phone. You can check the status of your bookkeeping throughout the month. That’s true even if your team has not yet finished preparing your financial statement for the month.
Whether you are using the app, your mobile browser, or the desktop site, Bench gives you easy-to-read and attractive visuals to help you understand your business cash flow.
Bench updated its pricing by offering two plans: Essential and Premium.
The Essential plan is available for $299 per month when billed monthly and $249 per month when billed annually. This includes monthly bookkeeping, a dedicated bookkeeping team, year-end tax-ready financial statements, and unlimited communication with Bench’s in-house research team.
The Premium is available for $499 per month when billed monthly, and $399 port month when billed annually. This includes unlimited income tax support, and annual income tax filing for partnerships, corporations, and sole proprietors.
Bench also offers a generous free trial. The trial provides you with a month of completed bookkeeping, which includes an income statement and balance sheet. Trial clients also receive a full tour of the Bench app. The company sets up your accounts and integrations within the app so you get a clear picture of what working with Bench will be like.
Impressively, Bench does not require you to provide payment information to enjoy the free trial. There is no automatic sign-up hanging over your head. If you decide not to sign on with Bench, you are also free to keep the income statement and balance sheet created for you.
Bench Tax Services updated to Bench Premium Plan
Bench now provides tax preparation and filing as part of its premium plan. If you think bookkeeping is a hassle, just wait until tax time rolls around.
Bench connects you with a licensed expert to handle every step of your yearly tax procedures. Their Taxfyle experts have been trained by Bench, with an average of 15 years of experience. Plus, all of their tax experts are USA-based, background-checked, and accredited, so you know you’re in good hands.
If you’d like a tax consultation before you commit, Bench offers this for free! Then, if you do end up choosing them for your tax needs, they’ll handle it all from start to finish. They’ll take care of preparing your returns, finding your qualifying deductions, and filing your taxes.
Personal federal and state income tax filings are included for sole proprietors in our Premium plan. For S-Corps, C-Corps, and Partnerships, you can add on personal filing for one partner or shareholder for just $59/mo when billed annually or $69/mo when billed monthly.
Is Bench the Right Bookkeeping Service For You?
Bench packs a big bookkeeping bang for the buck, but that doesn’t necessarily mean it’s the right service for everyone. Here are some important aspects of the program to keep in mind as you decide if Bench is right for you:
- Bench is unable to provide invoicing, bill tracking, payroll, or inventory services. However, it does partner with companies like Gusto and Freshbooks to help handle these financial management chores. These partnerships offer seamless integration of all your financial paperwork needs.
- The proprietary software that Bench uses is not compatible with other bookkeeping software. This means you will not be able to import individual transactions from whatever program you have been using. Instead, your Bench bookkeeper will start with your most recent reconciled financials and basically start you off fresh–unless you choose to purchase the Catch-Up Bookkeeping to recreate your old books.
- The company’s proprietary software also means you cannot import your Bench information into new software if you decide to leave.
Ultimately, Bench gives you a more personalized and hands-off bookkeeping experience than you can find with the inexpensive software options. And it offers this service at a much lower price than you can find with individual bookkeepers. For many entrepreneurs, this makes for a winning combination.
Bench Pros and Cons at a Glance
|Truly free trial. You do not need to provide payment information
|“Modified” cash basis accounting may not work for the few businesses that need accrual based accounting.
|Low monthly fee that you can reduce further by paying annually.
|The proprietary software is incompatible with other bookkeeping software, which could make it onerous to onboard or leave.
|Dedicated bookkeeping team for your business.
|No Android app currently available.
|Automatic import of your transactions makes the work truly hands-off.
|Easy-to-use app and online site.
|Receive monthly financial statements on the 15th business day of the following month.
|Receive annual financial package, including a 1099 report, to help you file your taxes.
|Excellent customer service.
Bench Alternatives for Small Business Bookkeeping
Bench can make bookkeeping a breeze, but it may not be the platform you are currently using, or your bookkeeping needs may have changed. Other online bookkeeping programs can help you manage the day-to-day financial needs of your business. Some factors to consider when selecting a bookkeeping service are the features offered, cost, customer support, and integration with other platforms. Two of the most popular bookkeeping services for small businesses are Freshbooks and QuickBooks Online.
Freshbooks is accounting software for small to medium businesses with features to help you manage clients and projects. It’s perfect for freelancers who regularly invoice clients.
Freshbooks features include expense tracking, invoicing, time tracking, and payments. You can also create reports to provide insight into your business. Freshbooks services start at $7.50 per month and go up to $25 a month, depending on the number of your billable clients. Or you can try it free for 30 days with no credit card required to sign up.
If you are already using Freshbooks, the good news is they have an integration to help with the daily financial management of your business. Bench has partnered its bookkeeping services with Freshbooks’s business invoicing and billing to create an all-in-one financial solution. Built with small business owners in mind, Bench and Freshbooks can streamline your invoicing and time tracking while keeping your books accurate.
QuickBooks Online is a hub to manage the accounting for your business. As a small business owner, you want to have a clear understanding of the money coming in and going out of your business. They offer interconnected tools that make managing your business easier. One of which is QuickBooks Live Bookkeeping. You have the option to add Bookkeeping Setup and Full-Service Bookkeeping to your QuickBooks plan.
If you are new to QuickBooks, Bookkeeping Setup is a one-time $50 add-on that will pair you with an expert to customize the setup of your QuickBooks Bookkeeping. With Full-Service Bookkeeping, you will get a virtual expert dedicated to checking your records for accuracy and keeping them up-to-date, starting at $200 per month. QuickBooks Full-Service Bookkeeping also comes with:
- Daily account maintenance
- Monthly report review
- On-demand chat and video conferencing support
- Year-end tax review
When problems come up, being able to get help quickly is essential for a small business owner. Live Bookkeeping allows you to focus on running your business instead of running down a miscategorized receipt or preparing reports. You can get started with QuickBooks here.
The Bottom Line
No entrepreneur jumps for joy at the thought of doing their own bookkeeping. It’s time away from the profit-generating work of your business, and it’s kind of tedious to boot.
Bench’s unique platform provides you with a team of dedicated professional bookkeepers for a low price. Add in the intuitive user interface, the automatic import of transactions, and the annual financial package that takes the sting out of tax season, and Bench will truly be a life-saver for any number of small businesses in need of organized books.
Have you handed over your bookkeeping to the pros at Bench? Tell us about it in the comments!