It has always been a question in the minds of businesses on what is the difference between traditional and virtual accounting. What is traditional accounting? What is virtual accounting?
Basically, there are many similarities between the two.
Be it traditional or virtual accounting, terms and functions involved are the same like accounts receivable, accounts payable, inventory management, payroll and reporting for example. These form the most essential functions of financial and accounting management. The very purpose of accounting is to track inflow or income of the business via sales, and outflow or expenses they made in acquiring inventory, salary, and more; based on these the future forecasts/business plans are made, taxes are filed.
Basic difference is that the traditional accounting has the accountant in-house. He/she is given an office/cube within the organization and they function from there. In virtual accounting, it happens… well virtually.
In the traditional accounting method, the accountant/bookkeeper will come to the office/organization daily or weekly where everything is set up for them, whereas virtual accountants makes that obsolete. There will be no weekly/monthly visit, no
set up, and no elaborate hiring procedure thereby saving ample money.
Traditional accountants need to communicate with the business owners/department staff to get information on the resources acquirement, sales made, etc. for every sale or purchase made. Virtual accounting cuts the need of such communication as all the details are maintained online and securely accessible by the required employees and virtual accountants.
Virtual accounting still manages to take care of everything including payments to be made to the vendors and accepting/receiving payment from customers. Virtual office is set up and all the accounting activities are done in the virtual office. It saves you a lot of resources, space, time and more!
If you are in a dilemma or if you want to know more on traditional vs. virtual accounting, our representatives will help you choose the best for your business. Our Bookkeeping consulting and services help several businesses small to large across USA.
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Contact us today to more about virtual accounting, virtual bookkeeping, and more and how we can help you.