Bookkeeping is moving farther away from desktop computing and deeper into the cloud. This means that there’s no reason to have an in-house employee managing the day-to-day transactions of your business. Additionally, outsourcing can tighten a company’s budget while maintaining high quality bookkeeping. Our list below explores a few reasons why you may want to outsource your bookkeeping and accounting functions.
Save Money and Reduce Overhead
Hiring an in-house bookkeeper can significantly increase your expenses. Outsourcing your bookkeeping, however, can save as much as 62% from your bottom line when you no longer must worry about their salary, payroll taxes, or benefits. Additionally, you will save on training, software, hardware, and office supplies.
Save on Technology Costs
Outsourcing means you don’t need to buy costly hardware or software for your bookkeeping needs. A good bookkeeper will have access to the most up-to-date software and will have the expertise necessary to properly use those tools to assist your business.
Automate and Reduce Paper
You can lower your carbon footprint! Hiring a bookkeeper who can access your files online will reduce paper and toner use as well as use of your copier, fax machine, and your printer. Less filing and storage of hard copies will also free up your time.
Focus on Growth
When you are running a business, it’s important to keep growing. Unfortunately, when you are spending time on your bookkeeping, those are minutes you aren’t spending growing your business. It’s also likely that, unless you have an accounting degree, a bookkeeper is going to manage your transactions far more efficiently than you can or may even want to. Your accounts receivable, accounts payable, manage vendor relationships, issue financial statements, payroll can all be handled by your outsourced accounting team.
Access to Financial Metrics
Most bookkeepers will do more for you than just enter your daily transactions and give you an update on the business health each quarter. Ask your bookkeeper questions about your business on a regular business so that they can provide you with the types of reports you need to see to make sure you are progressing financially.
Gain an Outside Perspective
Internal employees are often loyal to the company they work for. This may make it difficult for them to deliver less than positive news to the boss when they see something going wrong or a negative financial trend. Outsourcing your bookkeeping means bringing in a neutral third party who will not hesitate to let you know when your financial health is going sour.
Reduce Fraud
There are three main components that, when combined, often lead to fraudulent behavior. These components are: perceived unshareable financial need, perceived opportunity, and rationalization. According to a study released in 2012 by the Association of Certified Fraud Examiners, small businesses are the most common victims of fraud. When a small business does not have access to a competent controller, they are more likely to miss abnormal activity occurring within the transactions and billings. However, when small businesses outsource these functions to bookkeeping experts, one of the legs of the fraud triangle is removed – opportunity.
Scalable Options
Growing your business or identifying areas to reduce spending becomes much easier with outsourced bookkeeping. Your bookkeepers can give you feedback and suggestions to assist you with increasing your profits. Bookkeeping and accounting firms also have teams of people available to work on your account. If you ramp up production, you don’t have to worry about hiring additional staff to manage the added bookkeeping tasks.
Better Tools
It’s difficult to stay on top of the latest software. However, that is exactly what your bookkeeper needs to do. They will have access to the most updated bookkeeping software and apps. Having to consistently upgrade these powerful tools for an in-house accounting team could become cost prohibitive.
Peace of Mind
No business owner should leave their finances to chance. Utilizing an expert who handles your account with integrity and honesty allows you to focus on growing your business. You will need to manage and monitor in-house accounting teams. However, the bookkeeping contractor must make sure the work is done properly and on time.
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