Many small business owners mistakenly believe that they cannot afford to outsource their accounting operations. This may not be the case in all situations, so if you have previously thought of outsourcing as an unnecessary expense, you may want to think about it again. There are several advantages of outsourcing accounting functions including:
- Making sure your bookkeeping needs are handled by experienced professionals
- Freeing yourself up to do marketing and sales
- Ensuring the proper withholding amounts are taken care of for your employees
- Reduce the need to hire additional staff members
How to find an Accounting Firm
Before you decide to outsource your accounting work, it’s a good idea to do your homework. Talk to other small business owners who outsource their accounting to find out if they can recommend a Certified Public Accountant for you to use. Check this individual’s reputation by inquiring with the Better Business Bureau before contacting them in person.
Trusting your intuition is the best way to feel confident that you have chosen the right accountant. Talk to this person so you can get a better idea of how he or she operates their accounting practice. Be sure to let the accountant know a little bit about your business management style so you can determine if you are a good fit for each other.
Since cost is often a huge factor in determining whether to outsource your accounting needs, it’s important to know how much you are spending for this service now. This can be easy to do if you already have a bookkeeper on your payroll, but what if you primarily take care of this yourself? In this case, it can be helpful to maintain a log of your accounting activities for an entire month. That way, you can see if there are certain times of the month where this activity is especially time-consuming, and therefore standing in the way of you accomplishing other things. Once you start maintaining a log, you could be surprised to find out how much time you actually spend on this chore.
One way to know if outsourcing your business accounting tasks is a good idea is to “test the waters.” Start small by turning over functions such as payroll or month-end reports in the initial stage. That way, you can determine if you truly notice a time and cost savings from outsourcing these tasks. It will also give you a better idea of how well your business needs are taken care of by the accounting firm you have chosen.
Once you are happy with the results on a small scale, you are ready to trust an accounting firm with more responsibility. Try allowing them to maintain your bookkeeping functions or prepare financial reports. Never commit to more than you are comfortable with, since your business is your livelihood. Be sure to ask questions any time you are unfamiliar with the methods used to track your company’s finances.
Many accounting firms successfully manage bookkeeping and payroll functions for large and small businesses alike. In recent years, small business owners have begun to recognize the fact that they are sometimes unable to manage all the aspects of running a business on their own. If you are in this situation, outsourcing your accounting needs could be the right answer to ensure your company’s success.
About Author: Sandra Powers is a freelance blogger who writes about higher education. Sandra recommends that business-people interested in furthering their careers learn more about the degree options available to them.