As this list shows, the offerings and pricing of accounting firms for small businesses vary widely. The key is understanding your accounting needs and the value of having someone from outside your business fulfilling those functions. Even the most expensive firm on this list is probably less costly than hiring someone to perform them in-house.
If your budget is a concern, you can consider low-cost options, such as 1-800Accountant or Bench Accounting. If you can spend a little more each month to get the best bang for your buck, Bookkeeper.com is your best option.
However, if you’re looking for the best all-around accounting firm, you can’t go wrong with inDinero for its comprehensive offering, excellent customer support, and reasonable pricing.
|Best Accounting Firms|
|Best Overall||inDinero||Starting at $300/mo|
|Best Basic Plan||1-800Accountant||$149/mo|
|Best for Hiring Freelancers||Paro||$40/hr for bookkeeper; $120/hr for CPA|
|Best for Bookkeeping Services||Bench Accounting||Starting at $139/mo|
|Best for Startups||Pilot||Starting at $599/mo|
|Best Value||Bookkeeper.com||Starting at $285/mo|
What Is an Accounting Firm?
An accounting firm is fully staffed with experts to offer bookkeeping and accounting services for your business. It prepares financial records to help you track your revenues and expenses. It can also conduct an audit to organize your processes and controls to ensure records are properly kept with taxation services to help you prepare tax returns and advise you on how to reduce your tax liability. Accounting firms help you with your long-range planning with cash flow projections and advice on how to allocate your capital for an additional cost.
Online accounting firms use sophisticated data-encryption and communications technology to link clients to their services via an online platform. Source documents and data can be uploaded to cloud storage where they can be accessed from any remote location.
Firms typically bill for their services at a fixed monthly rate, benefiting a business from a budget planning standpoint. Some services may be billed on a pay-for-performance basis.
Who Should Use Accounting Firms?
For businesses on a growth track, the cost of not outsourcing bookkeeping and accounting can be detrimental to the business. This happens when performing the functions in-house interfere with essential business growth activities. Every hour you spend on bookkeeping or accounting is one less hour spent marketing your business, building client relationships, and other business development activities. At some point, the cost to your business in terms of lost growth opportunities becomes immeasurable. That’s when you know it’s time to outsource your accounting function.
You know you need to hire an accounting firm when
- The growth of your business outpaces your capacity to efficiently manage your cash flow
- You need to raise capital through bank financing
- You need to create a solid business plan
- When you need advice about your business’s legal structure
- When you need help preparing your taxes
How Do You Choose an Accounting Firm?
Small businesses have a wider range of needs than individuals, so it’s essential to work with an accounting firm that caters to small businesses—even better, one with experience working with businesses in your industry.
Fees are also an important consideration. The cost of outsourcing these functions must make sense for your business based on the level of service it needs and your budget. You should expect to pay more for accounting services as a business than you would as an individual because there are more functions to perform.
If you are already using an accounting or bookkeeping software program, it would be ideal to work with a firm that utilizes the same software. Many firms accommodate multiple software programs. If you don’t already use a software program, the accounting firm will recommend a package.
Finally, look at the range of services offered. You may only need account reconciliation services now but will need to layer on financial and cash flow management services later. If a firm only offers a package that includes services you don’t need, you may pay more than you should at this stage in your business.
What Do Accounting Firms Cost?
Online accounting firms typically charge a monthly fee, which can help businesses to plan their expenses. For many firms, the monthly fee is based on the level of services you need. You can pay as low as $150 a month for a starter package that includes day-to-day bookkeeping, account reconciliation, financial report preparation. With some firms, you can then layer on services or choose a mid-tier package that provides for cash flow management, accounts payable and receivable, and expense tracking for $300 to $500 a month.
Many firms that charge a flat monthly fee also offer tax filing services for an extra fixed annual fee in the range of $750 to $900. Some offer payroll services as an extra for $40 to $80 a month.
As you’ll find with some of the firms in this review, billing methods can vary beyond a monthly fee, such as an hourly, pay-for-performance fee, or rates based on the number of monthly transactions. In all cases, it’s important to crunch the numbers to see what rate or form of billing makes sense for your business.
How We Chose the Best Accounting Firms
If you’ve done your own search for accounting firms, you know there are dozens from which to choose. So, narrowing your choices to the ones that best suit your needs can be daunting. With this review, we did most of the leg work to narrow the list from 20 of the top online accounting firms to six of the best in various categories. In reviewing the list through a small business lens, we applied a strict set of criteria that included length of operating history, small business focus, range of services, distinct features or services offered, cost, and level of customer support.