1. YOU’RE ACTING AS CEO & CBO
(CHIEF BOOKKEEPING OFFICER).
Unless you’ve inherited a fully staffed and successful business operation, it’s likely that, over the years, you have worn more than your fair share of hats in order to grow your business. It’s not uncommon for the default mode of small business bookkeeping to fall to the owner, the owner’s spouse, the office manager, or a part time bookkeeper.
When it comes to maintaining a well-managed bookkeeping department and developing best practices for financial system design and integration, a growing small business that attempts to ‘do it all’ may find more pain than gain. Whether it’s under-trained or over-worked staff, or incorrect or inefficient bookkeeping procedures, both pains lead to similar results – inaccurate financial data, delayed financial reporting, and fiscal uncertainty. Even if things are rated as “good enough,” you’re likely missing out on a valuable opportunity to take a status quo task and turn it into a goldmine of strategic opportunity.
If your business is heavily reliant on a few key employees to fulfill numerous roles and tasks for the company, then outsourcing your bookkeeping functions may be a viable alternative to building the needed internal capability from the ground up. Outsourced bookkeeping service providers can offer your business the hassle-free benefits of a fully trained bookkeeping department, complete with expertise in financial software and systems design, all the while reducing your overall operating costs while increasing your competitive advantage.
2. YOUR INTERNAL CONTROLS ARE LACKING .
Is the person writing your checks also the person reconciling the bank statements? If so, your business is lacking separation of duties and is at serious risk for occupational fraud.
From billing and payroll fraud, to check tampering and skimming, there are a plethora of occupational fraud methods employed by thieving employees to unburden you of your profits. While many small or growth-oriented businesses overlook the importance of implementing systems and strategies designed to reduce their risk, it’s certainly a valuable investment, considering the impact of occupational fraud – the typical surveyed organization lost 5% of its annual revenue to fraud, at a median loss of $140,000 per case (ACFE 2014 Report to the Nations on Occupational Fraud and Abuse).
The overall goal of internal controls is to make it harder to steal and easier to uncover. Regardless of your company’s size or number of employees, by outsourcing your accounting and controller duties, your business will benefit from effective separation of duties by inserting an additional level of review. In addition to mitigating fraud risks, proper internal controls ensure that the flow of information into your financial system is valid, timely and classified in the right period. Instilling high standards now will net the high quality information your business needs to make informed decisions and take strategic opportunities in the future (see also GrowthForce’s blog series on “How to Reduce the Risk of Fraud).
3. YOU DON’T HAVE YOUR FINGER ON THE FINANCIAL PULSE OF YOUR BUSINESS.
At GrowthForce, many of our clients who sought us out saying, “Sign me up!” were initially motivated by either the presence of pain (“My bookkeeper walked”) or the search for enlightenment (“I want peace of mind that my books are accurate and on time, so I can focus on scaling my business.”) In the first scenario, it’s painfully evident what can happen to a small business without a reliable and trustworthy bookkeeper to keep a tight handle on the company’s financial health. A study of successful businesses conducted by the Geneva Business Bank found that businesses planning out their cash flow annually only have a 36% survival rate over five years, but those doing it monthly have an 80% survival rate. Cash is the lifeblood of any business, and you need to know exactly how much money is coming into and going out of your business in order to correctly guide the decisions you make. When you employ a knowledgeable accounting professional to follow disciplined record keeping and KPI reporting, you can count on your numbers and keep your finger on the financial pulse of your business.
In the search for enlightenment, the driving force behind the decision to outsource bookkeeping is the ability to focus on core competencies for the overall benefit of the business. One of the top drivers behind a business’s decision to outsource is access to the expertise, specialization and world-class capabilities delivered by service providers. By tapping into their extensive investments into technology, methodologies, and people, your business gains a competitive advantage while avoiding costs associated with chasing new technology and training. For instance, part of GrowthForce’s initial setup includes examination of your internal processes. This often leads to breakthrough improvements in efficiency and performance measures. Just imagine the power and competitive edge that comes from making strategic decisions based on timely financial data and critical reports, such as your Key Performance Indicators!
By outsourcing your bookkeeping and accounting, your business is better positioned to scale instead of building an accounting department. As a result, your head can stay in the game instead of in the books. This also means your most valuable resources, your employees, are able to focus on core activities that benefit your clients and add greater value to your overall business. Thus, when you leave it to the management accounting and QuickBooks system experts, you can focus on meeting the needs of your core business – your clients – which is what keeps you in business in the first place.
Here are a few more reasons why companies outsource their bookkeeping:
Top Reasons Companies Outsource Their Bookkeeping
- Cost Effective
- Consistent Reconciliation
- Allows you to focus on core business
- Fraud Prevention
Why Outsource Your Bookkeeping? It’s Cost Effective!
- Reduction in employer payroll taxes.
- No worker’s compensation insurance.
- No medical insurance or other benefits to pay.
- No retirement plans.
- No vacation or sick days to consider.
- No placing classified ads, screening interviews, testing and training.
Quality Accounting Solutions is THE ANSWER to outsourcing your bookkeeping. Contact us today to set up an appointment.
Source: (Growth Outsource)