The Benefits of Outsourcing Bookkeeping
The quickest solution to bookkeeping hiccups is to have your in-house accountant make your books look presentable to the IRS for tax filing. They do this by making quick fixes, such as entry adjustments. This results in your business making it over this IRS hill, where it’s safe--for now.
But if your books are inaccurate, then so are your financials.
How can you make sure that your books and therefore your reports are accurate so that you can use the data to make informed decisions?
This is where outsourcing comes in. The most defined quality that makes outsourcing any service for your business stand out is the assured accountability. What a bookkeeping and accounting firm can offer that an independent hire cannot, is a quality control procedure, in which the accountants are examined before being hired and placed at a business. This procedure takes place once a month to ensure your books are reliable, and you can use that information to make proper financial decisions.
Additionally, employees are often hired by companies based off of their degree, resume experience, and interview charm. But what about an interview process that simply tested a potential candidate to see if they can actually complete the job properly? In accounting, an applicant must do well on both QuickBooks software and accounting principles tests in order to do well at the job itself.
The accounting firm is staffed with quality employees is only one side of the coin; the other match that must be made is the employee to the client--you. The match is made based on the employee’s personality, proximity to your office, and the understanding of your business’s industry. A manager from the bookkeeping and accounting firm accompanies the bookkeeper to the client’s office so they can understand the financial aspects of the back-end of your company--a complementary service.
The outsourcing company is their own profit center, and they are therefore focused on refining their service in order to be the best at what they do.
Outsourcing services for any aspect of a business guarantee three things across the board, according to “The Benefits of Outsourcing,” an article in The CPA Journal. Efficient functionality, reliability and consistency, and cost savings (Grauman, 66). The outsourcing company is their own profit center, and they are therefore focused on refining their service in order to be the best at what they do. Their reliability stems from their duplication of efforts--when a company is seeking the right accounting firm to hire, they can seek reviews on the service by other companies with similar needs. Lastly, outsourcing saves business money because when the outsourcing company is focused on the best solution to the problem, they know what they’re doing and they bring all the software and expertise to their clients.
An article in Construction Today, “Fostering Growth,” speaks about the benefits of outsourcing, and shares that “many organizations have completed ambitious transformational programs in which they outsourced their finance and accounting (F & A) function, in some cases as part of an even larger multi-process and IT outsourcing arrangement.” (Rowlands, 10). The benefits they discovered in doing so were more than simply cutting costs and having that aspect of their business being taken care of efficiently and reliably--they discovered that through the transition, they were able to stop worrying about these things (F & A and IT), and focus more on using information obtained this way to make the best business decisions.
An outsourcing company brings their best solutions for the service with them to their clients. A successful outsource will have the latest technology and a business model that is proven to work. This is healthy for the business who hires them in other ways besides the ones mentioned previously. The client and outsourcing company’s relationship will influence the client to remain creative and borrow ideas, which can include anything from software used to HR strategy.
It is a business’s choice whether to hire an in-house accountant and bookkeeper or outsource the services. If they want to keep costs practical, rely on the accountant to get the work done efficiently and correctly, and have all means necessary to focus on the expansion of their business, then it might be practical to consider outsourcing.
Grauman, Kevin. "THE BENEFITS OF OUTSOURCING." The CPA Journal, July 2000, p. 66. Academic OneFile, Accessed 19 Dec. 2018.
Rowlands, David. "Fostering growth: more companies are coming to realize some of the intangible benefits of finance and accounting outsourcing that can lead to high performance." Construction Today, Apr. 2006, p. 10+. General OneFile, Accessed 19 Dec. 2018.