This blog discusses why outsourcing accounting functions is a must in 2023.
Outsourcing Helps Reduce Costs
Most accounting firm owners may think of outsourcing as an added cost, but it is a small cost that can help you save big bucks. This happens because outsourcing saves money in three ways:
- A full-time staff for your accounting means giving out salaries, benefits, paying taxes, etc. Meanwhile, you can outsource accounting functions at a fraction of this cost.
- It also saves money on renting extra office space, electricity bills, and the hassle of going through the entire hiring process.
- With outsourcing, you gain experienced accountants with the expertise to save money on taxes, investments, etc., for your business.
Outsourcing MaximiSes Resource and Time Utilisation
Outsourcing is a way to go for small businesses working with a limited staff. It will free up your employees’ time to take on more critical work like marketing operations or networking to grow your business.
This ensures that you fully utilise your staff and that your team fully utilises their time. Outsourcing also gives you peace of mind as your core accounting work is kept from a handful of employees whose absence or quitting can affect your daily accounting work.
Outsourcing Provides Access to Talented Accountants
The third-party company you outsource your accounting functions to has a quality pool of talented accountants with years of experience. Therefore, you will be able to get quality work done cost-effectively and in less time. These companies also provide services in all accounting departments, meaning you can access bookkeepers, CFOs, etc.
If you are a small business, you must know how hard it is to hire talented employees and retain them for years. You will not need to worry about this once you outsource your accounting functions.
Outsourcing Helps Gain Improved Technology
While having experienced accountants is excellent, having access to improved accounting technology tools is even greater. An accounting firm specialising in outsourcing accounts will provide sophisticated accounting software to help you perform better.
These improved technological tools have automated functionalities and an inbuilt cybersecurity system to protect your financial data on the web. This means you can access your accounting data from anywhere using the cloud.
Outsourcing Helps Scale As Per Your Needs
Your accounting firm may be busier during tax payments or when you are pursuing a big project from a client. Other times, your accounting needs may be less. In such a case, outsourcing works best because it allows you to pay for what you need and only when you need it.
Your fixed staff salaries can be converted to variable outsourcing costs. You would not need to pay your staff overtime in busy season or hire new people only to fire them later when the demand goes down.
Outsourcing Reduces Chances of Fraud
According to the Association of Certified Fraud Examiners, businesses lose 5% of their revenue to employee fraud annually — and 12% of frauds occur in the accounting department.
Having accountants outside your company who c cannot profit from miscalculated financial statements gives you the edge and cuts the risk of fraud. These accountants are also more experienced at detecting fraud.
Outsourcing Makes Decision-Making Simpler
With expert accounting data, you can make the right financial decisions. The company you outsource your accounting functions to has professionals who have worked on your niche business for years. So they can provide you with better advice and more accurate data and analytics that helps in decision-making.
Outsourcing Increases Compliance
Your in-house staff may have a lot of work, including filing invoices, making journal entries, reconciling accounts, etc. They may need more time to stay on top of the latest tax laws and regulatory standards.
Accounting firms that specialise in working on outsourced accounts monitor all such regulations closely to help companies avoid fines and legal fallouts.