The Pros of Outsourced Bookkeeping Services

Outsourced bookkeeping services have become a more common solution for small businesses today. Why? The advantages, which once were only enjoyed by mid-market and enterprise companies, are becoming understood by smaller companies.

With a outside accounting team, CEOs and business owners have access to knowledgeable, trained staff working to help their business run better, grow faster, and make more money. Often at a significant cost savings vs. building an internal accounting department.

Why Do Companies Outsource?

Cost savings, focusing on core business functions, and solving capacity issues are primary drivers to outsource. Leading organizations use outsourcing to drive transformational change and improve business results. - According to Deloitte’s 2016 Global Outsourcing Survey

So should you consider outsourcing your accounting?

Pro #1: More Cost Effective

Hiring an outsourced accounting service is often cheaper and more cost effective than hiring in-house staff to handle the finance function. By outsourcing, you don’t have any attributed overhead costs that hiring an employee would generate, such as PTO, health insurance, retirement, vacation, Workers’ Comp, and sick days. Also, the value of having an entire team’s expertise, rather than just one internal person (or more), includes reducing the risk of non-compliance and unreliable financials – especially for smaller businesses starting out.

Pro #2: A Proactive Approach

As a CEO, you didn’t go into business to be a trained financial professional overseeing the books. You want to run your business, and focus on the overall growth and vision of the company itself. This is why having an outsourced accounting team has the advantage of proactivity, where they can spot red flags ahead of time and notify you about expenditures and cash flow, for example. Having trained eyes on your finances at all times can bring considerable peace of mind, as well as the confidence needed to make intelligent financial decisions.

For business owners, handing over the control of the books can sometimes feel uncomfortable. Starting out with an in-depth onboarding process that defines roles, policies and procedures sets expectations and ensures communication is timely.   

Tips for a Successful Outsourced Accounting Relationship

Pro #3: Reduced Fraud

Fraud is an unfortunate result in many small to medium-sized businesses with one person at the helm of accounting. That’s because it’s easy to manipulate the books, or have a fake expense go unnoticed for months, or even years. There are multiple warning signs that can indicate fraud, and are oftentimes because of a hardship an employee’s going through, where they feel financial pressure and don’t know what else to do. Don’t just blindly trust your employee without any controls or accountability – it’s a surefire sign to leave you wide open for fraud. How to Establish Internal Controls with QuickBooks®

With outsourced accounting services, you have multiple pairs of eyes on your transaction processing and reports, which provides increased internal controls. While fraud can never be ruled out 100%, a dedicated team with specific expertise in accounting best practices will be far more likely to spot an anomaly than one person who’s probably overburdened and overloaded with work.

A Dedicated Team, & a Virtual Accounting Machine

From advanced bookkeeping and accounting to customized management reporting and controller services, your outsourced accounting service is designed to augment your staff and transform your finance function. It’s not just about maintaining your accounting, but also providing a platform to drive profits, improve cash flow, and grow your business.

Here at Nugent & Associates, we’ve helped businesses and nonprofits of all sizes, gain the peace of mind, efficiency, and actionable financial intelligence they need to succeed.