In today’s times hiring a professional accountant who can prepare financial statements, analyze data, manage accounts and records, prepare invoices, etc is a challenging task and an expensive affair. Small businesses and entrepreneurs face this challenge much more as they are not comfortable doing the accounting on their own as they lack the expertise needed for accounting and have to spend more time on core business activities. Hence, most small businesses and entrepreneurs looking to outsource their accounting to a company that has both skills and experience to do this job, providing qualitative and cost-effective solutions. Some accounting services that can be easily outsourced without affecting the business functioning are:
- Accounting and Bookkeeping
- Financial Reporting
- Payroll Services
- Accounts receivable and payable
So this leaves us with some questions like
- Why is the demand for outsourced accounting increasing?
- What are the benefits of Outsourcing Accounting Services?
- When is the best time to switch to outsourced accounting services?
- Who do I outsource the accounting services to?
Let us answer these questions one by one –
1. Why is the demand for outsourced accounting increasing?
The growth of information technology and cloud accounting has played a very important role in the growth of outsourced accounting services. Earlier outsourcing was only done for cost reduction but now outsourcing provides effective, efficient, and result-oriented outcomes. The companies engaged in outsourcing services act as partners who provide expert advice, manage cash flows, etc. They ensure that the client’s data and information are protected and used to derive reports and financials while the client can totally focus on their business.
2. What are the benefits of Outsourcing Accounting Services?
Outsourcing accounting services could free- up some time and also save money. Other benefits of outsourcing include:
- Trained and professional accounting and bookkeeping experts
- Cutting down infrastructure and hiring costs
- Offloading managerial responsibilities
- Use of sophisticated and automated technology and services
- Personalized /tailor-made accounting services
- Informed and experienced business advisors
- Virtual CFO services
- Data Privacy and data security, etc
With all the above-stated benefits it is best to consider outsourcing for your company so that you can spend more time and efforts towards making strategies for the growth of your business.
This brings us to the next important question …..
3. When is the best time to switch to outsourced accounting services?
a. At the start of the Financial year or End of the Month:
It is easier to outsource accounting at the start of a financial year or the end of any month, by doing so the outsourced company can work on the financials with a fresh start while also checking the previously completed accounts to provide the necessary head start.
b. As soon as you want to:
Businesses are always uncertain and things change very quickly, that being said, no time is truly ideal to hand over your accounting, but by choosing a reputed outsourcing company to handle your accounting you can be ensured that this transition happens smoothly with very few glitches.
c. At a particular Business stage:
Companies usually outsource their services when the scale of operation increases and they are unable to focus on business finances. However, it is best to outsource a company’s accounting service at the early business stage. This ensures that the quality of accounting is maintained, there are fewer errors/ mistakes, you meet all compliance requirements, and thereby set high accounting standards right from the very start.
d. Lack of professional expertise at hand:
One of the advantages of outsourcing accounting services is availing the professional services of highly trained and experienced staff that are usually very expensive to hire in-house. By outsourcing accounting, companies can ensure that the accounting is done by experts and the results are highly professional without errors and of the desired standard.
e. To reduce overheads and liabilities:
If a company desires to keep its liabilities and expenses related to infrastructure and hiring financial professionals to the bare minimum without compromising on the quality of accounting, then outsourcing solves this issue. The right outsourcing company uses the services of its professionals across various domains without compromising on the deliverables at the lowest possible cost.
f. If you are paying too much:
Outsourcing can be done if you are paying too much to in-house financial professionals/ accountants and experiencing errors, late fees, tax penalties, etc. One must keep in mind that outsourced accounting service is an investment and hiring an outsourcing company promises quality results that boost profitability at the lowest possible cost.
g. To ensure compliance with laws, taxes, and regulations:
Every business is governed by numerous laws, rules, and regulations. These rules keep changing almost every year, thus making it challenging for companies to stay up-to-date. The easiest way for companies to be compliant with all laws and ensure that all tax-related timelines and liabilities are met is by hiring an outsourced accounting company. The outsourced company’s team of experts understand the in and outs of all rules and regulations which surely help their clients businesses all along the way.
h. To help the business grow further:
Outsourced accounting service providers hire trained professionals who give the best business advice helping businesses grow. They also provide services of VCFO which is really helpful for small businesses who find it difficult to hire a full-time CFO. Such professional services make outsourced accounting a very attractive proposition.
4. Who do I outsource the accounting services to?
There are a number of companies that provide outsourced accounting services. If you are looking for an outsourcing partner who can drive your company beyond accounting and bookkeeping then Diligen is surely one of them. Diligen’s accounting team helps you to get on the right foot which is very valuable for any business either at the early stage or at the growing stage. Our team at Diligen specializes in both small and large businesses. Our professional experts are always here to help and support you at every step and bridge the gap between a company’s financial goals and the actual numbers thereby increasing the client’s financial viability. We also provide customized accounting solutions and take care of each of our client’s needs.
If you need to talk and discuss how our services can be put to your best use then it’s the right time to get in touch with us so that we can help you serve better.