The Benefits of Outsourcing Accounting
Wesley Grant
Are your accounting functions a drain on your time and energy?
You’re not alone. Day-to-day operations consume so much of a business owner’s time, it can be a struggle to complete basic accounting tasks that are critical to a company’s success.
As your business grows, it’s even tougher to manage the books yourself, and it’s hard to find trained professionals who’ll work at a rate you can afford. That’s why more companies are outsourcing accounting.
Outsourced accounting firms provide a suite of customized accounting solutions called Client Accounting Services (CAS). CAS can do anything an in-house accounting team can do and more, covering everything from balancing the books to tax assistance.
CAS professionals are top-tier CPAs who’ll evaluate your company and offer real-world resolutions to your accounting challenges. CAS provides a combination of services and software that will optimize your accounting functions and get you back to what you do best: driving your business.
Client Accounting Services Overview
The objective of CAS is to assess your company’s financial health and give you the knowledge to make informed business decisions. Here are some of the services that CAS performs:
Financial reporting (monthly, quarterly, or annual basis)
Maintaining Accounts Receivable, Accounts Payable, and other ledger updates
Paying bills
Preparing tax returns (business and individual)
Household employment filings
Managing Inventory
Assessing internal controls
Creating Key Performance Indicator (KPI) dashboards
Managing Payroll
Assessing point of sale (POS) systems
Implementing software
Consulting and training on software
CAS firms can provide all of these services on a long-term basis, or just the key functions you need. With CAS, it’s easy to tailor an accounting package to your company’s (and your industry’s) specific needs.
The benefits of outsourcing your accounting department
No personnel problems
Finding skilled accounting staff is tough enough, it’s even harder to find reliable team members who will be there when issues arise. If you outsource, you won’t have to go through the hiring and training process, pay employee benefits, or suffer a loss of coverage when an employee takes a sick day or resigns. CAS firms have a team of CPAs that are familiar with your company, so they can always step up when you need them.
Solutions can be tailored to your industry
One size doesn’t fit all when it comes to accounting; every industry has its unique needs. Because CAS firms work with other companies across multiple industries, they have a better understanding of the challenges you face.
They’ll also give you better insight into the accounting methods your competitors use, to make sure your company is in line with industry standards.
Customizable pricing
You don’t have to outsource every aspect of your accounting department if you don’t want to. Client Account Services can be purchased individually, so instead of paying employee salaries every month, you pay for the services you need.
You can outsource a project like a systems overhaul, or you can hire a firm for ongoing work. As your company grows and your accounting demands change, you can adjust your services at any time.
Easy to scale
As your company scales, CAS technology and services scale with you. Outsourced accounting firms have the capacity to shift personnel and increase your technology allocation as business picks up.
Companies often outgrow their accounting department and suffer growing pains. CAS grows along with you, pain-free.
A larger variety of services
An in-house accounting staff has a specific scope and finite capabilities. Outsourced accounting firms can do it all, from accounts payable to tax returns to ledger entries. The wide variety of services combined with custom pricing means your company gets more and pays less.
A better-qualified team
Do your accounting needs require a more advanced level of accounting prowess? Many smaller companies need an executive-level employee, but they don’t have the bandwidth to hire one.
CAS advisors have an executive skillset and they cost much less than hiring a CFO. Outsourced professionals undergo rigorous annual training to make sure they deliver accurate information and the latest technology.
Always available
Staffing shortages are a fact of life, and it’s no different in the accounting industry. Because CAS provides a team of professionals who know your industry and your business, there’s always an advisor who can take your call.
Costs less long-term
Outsourcing your accounting is likely to cost more than hiring in-house on a month-to-month basis, but there are some long-term financial benefits to consider. You’ll never miss out on accounting coverage, have to pay employee benefits, and you won’t have to waste time interviewing and training new personnel. These benefits add up in the long run.
Outsource your projects
Do you have a major accounting project looming over your head? CAS firms don’t have to take over your accounting operations if you don’t need them to. Hire them to handle a project that you’re not able to complete, and you only pay for the work that’s performed. Here are some of the projects that CAS firms can perform.
Technology assessment
Technology is a critical part of modern accounting. Outsourced professionals will assess your accounting software and help you optimize your technology solutions. CAS advisors offer software training as well, so you’ll know exactly where to find your crucial financial data, and how to use it.
Evaluating your financial reporting
Financial statements can be time-consuming and difficult to navigate for many business owners. Outsourced professionals can evaluate and enhance your reporting process, ensuring that all of your reports are accurate and easy to read.
Analyzing your business
CAS firms offer tools that will set benchmarks and KPIs within your business. These indicators give you actionable data that you can use to improve the financial health of your company.
All of your financials will be easy to access in a dashboard format. After your benchmarks are in place, your outsourced accounting firm can help you streamline your business for optimum performance.
How do I choose the right accounting firm?
You want an outsourced accounting firm that has experience, ideally in your industry, working with companies that are similar to yours. Your company’s financial health is extremely important, so you don’t want to hand over your accounting functions to a fly-by-night firm. Search for a CAS firm with a documented history of ongoing service to businesses like your own.
Every industry is different, so you need a CAS advisor that understands what you’re up against. An outsourced professional with expertise in your niche will be in a better position to advise you on industry best practices, so you can get ahead of the competition.
Your finances are the lifeblood of your company. Be sure you know exactly who is managing your money and if they’re managing it securely. So many accounting firms have sprouted up, both onshore and offshore, but not all of them can deliver the same level of security. Talk to your CAS advisor about the ways their firm will protect your financial data.
One of the downsides of outsourcing is that you can’t just walk down the hall and talk to your accountant. For that reason, it’s critical to pick a firm that responds when you need them. How many members of the CAS team will be familiar with your business? How can reach out to them? Be sure to get those answers from your advisor before moving forward.
Are you ready to outsource your accounting department?
Before you start calling accounting firms, it’s worthwhile to step back and determine your business objectives. You’ll have to decide the scope of your accounting needs; whether you need project work like a POS upgrade or day-to-day operations assistance. After you determine the services you need, you’ll have to gauge what your budget allows.
If you have current accounting staff, it’s important to understand exactly what their job duties are and what they do on a daily basis. You might find out you’ll have to keep some essential functions in-house. You’ll also have to evaluate your current software and reporting functions to see if your current situation is in line with your objectives.
Next, you’ll need to assemble and assess your financials. In order for your CAS advisor to be successful, you have to give them an honest appraisal of your company. The more open you are about your financial situation, the better chance they’ll have to help you overcome your obstacles.
CAS in summary
Accounting is a critical part of business success. Outsourced accounting firms offer more services, more advanced technology, and better-trained professionals than you are likely to find yourself.
Outsourcing may save you money in the long term, but it will cost more initially. You also want to make sure you’re working with an established firm that can protect your financial information.
If your business is growing and you have the budget to outsource, talk to accounting firms to see if they can help. The benefits of outsourcing accounting could outweigh the short-term cost in the long run.
Written by:
Wesley Grant is a business and personal finance content writer who has worked with leading brands from across the globe. His passion is creating valuable content that will inform business owners and educate consumers. Wesley earned his MBA from the University of South Carolina.
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Posted Jun 6, 2023
Are your accounting functions a drain on your time and energy? You’re not alone. Day-to-day operations consume so much of a business owner’s time, it can be a …
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