During the current crisis your attention has been focused on saving your business and keeping cash flow positive. You’ve had to make some hard decisions, maybe even choosing between laying off employees or to stop paying your rent. Perhaps you’ve had to look at downsizing or eliminating positions, including your accounting staff. But today more than ever, you need real-time financial data to run your business and you can’t afford not to have that information. It could be time to consider outsourcing.
Outsourcing allows organizations to scale resources up and down as needed, without having to worry about personnel costs and the related costs of hiring, training and maintaining your staff. Outsourcing accounting functions to qualified firms allow for managing processes such as accounts payable, payroll and financial statement preparation. It also provides you and your business with the opportunity to leverage the varying expertise of many accountants to yield additional benefits, which is even more critical as we adjust to business in this new environment.
Benefits of Outsourcing
Here are just a few of the reasons the outsourcing option could help your business today and be a solution for the long term.
Do you automatically think hiring an accounting firm to manage your books will cost more than hiring an internal person? The fact is you’re more likely to save money. Instead of paying full-time or part-time wages and benefits to an employee – including insurance, payroll taxes, unemployment taxes, paid time-off, etc. – you pay only for the time required from a staff focused solely on your financials. You won’t have to worry about lost productivity from office distractions, staff meetings, and vacations or providing a workspace and equipment needed to do the job in-house. As an example, an analysis of one of Anders current outsourcing clients showed a $110,000 of cost savings by outsourcing vs using inhouse accounting services. The good news is that outsourcing is scalable for most businesses of all sizes.
Trust an Experienced Team of Advisors
Now is the time you need an experienced team helping you manage and analyze your financial situation. An accounting firm offering outsourced solutions brings experience from a variety of client situations that internal employees may not have. Take for example your Paycheck Protection Program loan. You may have received the loan, but now what? Effective financial management requires a deep understanding of accounting best practices, current laws and regulations, and compliance requirements. By bringing in an outsourced provider, you have access to the right set of knowledge for tasks from payroll and accounts receivables to financial statement analyses and tax planning.
Access the Best Accounting Software and Cloud-based Systems
When stay-at-home orders were announced, were you ready for your accounting staff to work remotely? Did your accounting processes continue without interruption? While many businesses may not be able to justify the price tag of today’s technologies and accounting platforms, outsourcing is a way to gain access to expensive technology infrastructure investments, all while accessing data remotely and in real time. Typically, organizations find lower IT costs and greater system reliability as a result of outsourcing. You’re essentially purchasing those tools indirectly without having to do the system research, licensing, or funding. This is ideal for those looking to cut costs or have limited means. Cloud-based accounting systems can provide solutions allowing for less paper, easy tracking, and keeping your accounting files organized and backed up for many years should you ever get audited by the IRS. Additional benefits are:
- Advanced functionality by optimizing automation
- Ability to view all expenses tracked in real-time for complete accountability
- Peace of mind that comes with additional security
- Improved analytics to give a complete picture
- Results delivered quickly and seamlessly
- Scalable solutions for any size business
It is well documented that we all have to be on the lookout for phishing scams and other security threats, which is one more reason to make the move. Think of your current processes that address confidential information and security of data from fire, theft, and hackers. You may be vulnerable. When you outsource, security for your books and financial records is enhanced. Most outsourced accounting providers work with technology and information technology firms that have rigorous safeguards ensuring access control, confidentiality, and redundant data backup.
We find that well-meaning business owners often leave tasks such as bookkeeping until the end of the quarter or, worse yet, the end of year. In this current environment, you have to know what’s going on in your business each month, if not each day. While it’s understandable to want to control costs and manage the function themselves, it’s essential to understand the risk of errors and other issues that can arise from such an approach. When you outsource, you can minimize the risks typically involved with relying on your own knowledge and timing or in-house staff. Outsourcing your accounting back office means having your books closed on a monthly basis, all accounts reconciled, and an accurate set of financial statement prepared. By outsourcing, when you need to analyze your business or produce a set of financials for your banker or investors, the information is readily available.
Outsourcing your accounting function is a smart alternative to drive efficiencies and innovation at any time. Today, it could be the best alternative to get your business through these most difficult times. Contact an Anders advisor to learn more about about benefits of outsourced accounting for your business.All Insights