Many small businesses, entrepreneurs, and start-ups find it challenging to hire a full-time accountant with the right skills to prepare their financial statements, analyze financial data, manage bank account operations, and prepare outgoing invoices. It’s even more challenging to find a qualified and eligible accountant at an affordable rate. That’s why more than one-third of small businesses choose to outsource their accounting.
Today, many businesses have noticed multiple positive aspects of outsourcing accounting and bookkeeping services. Some of the reasons to consider outsourced accounting include:
1. Access to Expertise
Outsourcing your accounting provides you with access to executive-level financial knowledge without having to invest in full-time executive-level salaries. A team of highly skilled and experienced consultants will take care of your accounting services and apply best practices to your business, making your job easier. So, instead of wasting time trying to figure out your financials, engage someone who can explain the numbers to you quickly. Besides, you’ll know your burn rate, employee utilization, and exact margins on every job or client, helping you make more informed decisions.
2. Efficient Segregation of Duties
By managing your books in-house, you open yourself to costly errors and fraud. An outsourced accountant will ensure checks and balances of your financial information. You don’t want the same person handling your payroll and accounts payable to reconcile your bank and credit card statements. An outsourced accounting solution provides access to accounting specialists who cross-check your books to ensure you’re getting accurate information and appropriate recommendations.
3. Enhanced Cost Effectiveness
Small businesses will rarely need an accounting professional for more than 40 hours a week. Before your business reaches the right capacity to afford a full-time accountant, you can outsource your accounting services on a monthly retainer basis. Alternatively, you can hire an outsourced controller to review your books and compile reports every month at a fraction of the cost of hiring a full-time employee. Outsourcing is a long-term strategy that helps fill the gaps before your business ever needs to employ a full-time accountant.
4. More Time for Focus on Your Core Business
Time is the most valuable resource for your enterprise. Putting your accounting tasks in the hands of trusted professionals means you can save time to focus on what you do best: growing your business. Backend office functions such as accounting and bookkeeping can be a big distraction from the day-to-day operational tasks on your plate. So, it’s best to delegate whenever possible and spend your time working on your business.
5. Improved Flexibility and Scalability
Although you may afford a full-time accounting team when business is good and the economy is thriving, losing a big customer or leads can turn the tables upside down. If that happens, you may be forced to lay off employees or face significant financial challenges. Outsourcing accounting gives you the flexibility to scale up or down based on your needs. Besides scalability, outsourcing accounting services allows you to focus on the core competencies of your company while benefiting from the expertise of an experienced financial professional.
Overall, outsourced accounting could make a difference in your company’s ability to ride out challenging times. It’s a great way to save money by reducing spending on wages and direct overhead for part-time or full-time employees. With outsourced solutions, you only pay for what you need while retaining the level of professional resources you require to grow your business.