When running a business, time is money, and every minute counts. As time passes, you will realise how much you need to get done but see yourself running out of time.
For this reason, in recent times in the business world, outsourcing corporate operations has become a common practice. Accounting is one of the activities most often outsourced by businesses.
Before you take your first step towards outsourcing your accounting function, it is important to weigh the advantages and disadvantages so you can make the right decision on whether to outsource or keep it in-house.
Benefits Of Choosing To Outsource the Accounting Function
If you have been contemplating whether or not to consider outsourcing, the best way to go about making a decision is to pull up a list of benefits for doing so.
Reduces Payroll Headcounts
It can be costly to train in-house employees to take over the accounting function of your firm. Outsourcing can be a great alternative as you can hire specialists to get your work done professionally.
Allows Concentration On Core Strengths
When a company outsources, it helps them to focus on what they excel at, while the outsourced professionals handle all the accounting work.
When Is The Right Time To Outsource Your Accounting Function?
You can start to outsource your accounting function at any time of the year. Do not worry too much about when would be a good time to start doing so. You just need to be ready to outsource with the necessary paperwork and budget.
Below are a few signs indicating that your company would benefit from outsourcing your accounting function.
The right time to outsource will be if:
You Do Not Require A Full-Time Bookkeeper
You are a small business that has just started and doesn’t require a full-time bookkeeper but is in need of someone with the necessary skills to handle the books.
Sometimes you may need a temporary accounting solution for a short period, such as for the end-of-year reports, or during other times, such as when the person in charge goes on maternity leave. For such tasks, it is wise to outsource your accounting function.
As A Growing Company, You Want To Scale Up
As a growing company, you may find it difficult to expand your accounting department but still want to scale up. Outsourcing your accounting functions ensures that nothing gets overlooked during the process, and you can scale up without tiring down.
The service provider will manage everything related to accounting, so you will not need to juggle it all by yourself. Instead, you can focus on growth and building strong relationships with customers.
You Are Disturbed About Tax Planning
There are high chances that you may be worried about paying too much taxes and missing out on many tax benefits if you have not outsourced to an accounting provider for your firm. As outsourced accounting providers are well-versed and skilled in tax planning, they will identify opportunities that will support your company’s financial position. They would also help you file your corporate taxes on time and accurately.
You Wish To Move Forward With Technology
You may fall behind if you are not using the latest accounting software. Staying updated with such software can make all the difference in moving forward as a company.
As a small business, it might be a struggle to research, acquire and implement the right accounting technologies. You can easily save time and money if you leave it to an outsourced organisation to implement the latest software and help your company stay current on accounting technologies.
You Need To Update Your Strategic Plan
The key component of any strategic business plan is finance. If your strategic plan involves the desire to expand by adding new products, services, or locations, or even if it is to acquire another company, the first thing you need to do is look at the numbers closely.
A good overall financial picture should give support to your strategic plan and help you move forward successfully.
An outsourced accounting firm will provide you with the necessary financial forecasts to ensure you can go ahead with your plans. It is important to be mindful of your options, whether it is that you will engage an outsourcing service provider or you will not.
But another question that may arise is, what accounting & taxation services should you outsource – full or partial? Here are the top 7 services that you should consider outsourcing to an accounting consultant for your peace of mind.
What To Look For In An Outsource Service Provider?
Skills And Services
If you are hiring a professional service provider, they should, of course, be competent in maintaining accounts, though you should look for other skills and services they can offer.
Though many accounting service providers offer the typical bookkeeping service, there are many who can handle more tasks, such as financial analysis. It is better to hire someone who will be able to handle a wider range of tasks when it comes to accounting.
Consider the number of years an accounting partner has been in service. Understand how the client’s needs have been delivered through their service by looking at their past clients and going through the case studies.
Established Presence With A Wide Regional Coverage
It is wise to select a provider who has an established presence with wider regional coverage in multiple locations.
The outsourcing partner you hire should be helpful, responsive, and willing to assist at all times. You must be able to understand their process for the workflow. Effective communication is important for the work to be done smoothly, and your outsourcing partner should be willing to add value through communication.
If you have noticed any of the above signs appearing within your business, this might be the right time to consider outsourcing your accounting function. An outsourced accounting service will help to improve efficiency and enhance tax planning, and all your financial statements will be timely and accurate.
Finance and accounting are the most crucial aspects for the success of any business. You cannot afford to make a mistake as they can give you an idea of whether your business is making a profit. It’s only wise to outsource your accounting function and let the experts manage it for you.
Outsourcing finance and accounting will help you determine your business’s financial status and how much income you are generating. Understanding these functions will also help you to make better and more successful business moves.