The two answers above are great. The only thing I would like to add is that even if you decide to NOT hire a bookkeeper I would recommend you outsource your payroll and purchase a low cost accounting program (Quickbooks or Peachtree). These are both very inexpensive purchases that will help you a great deal and keep you on the right track. One other thing that comes to mind is that if you do hire a bookkeeper make sure that you still have control and an understanding of your books and records. Many small businesses will just send the bookkeeper information and get the financial statements back without understanding what they mean or they will have an outside bookkeeper make entries and not have their internal records updated.