by Joyce
- Freedom: outsourcing to a service provider allows you to concentrate on income generating activities, increasing your income…
- Reduces overhead: if you don’t have an accounting department, you don’t need the office space, telephones, cubicles, chairs, filing cabinets, etc. You can reallocate that budget to other areas or eliminate it altogether.
- Real time accessibility: offering you real-time accessibility to reports, you know what your cash position is at any given time that is up to date. Up to date information allows you to easily manage your cash flow… and manage your business.
- Secure, off-site storage/backup: not that anything catastrophic will happen but just in case, all your financial information is safe and secure. The cost and time it would take to recreate your finances could be prohibitive, if that were ever necessary. With off-site storage & backup, you don’t have to worry about that.
- No more hiring headaches: it’s hard to find and supervise the work of a bookkeeper when realistically, you have no idea what they are supposed to be doing and turnover is costly.
- No more training headaches: if hiring is a headache, training is too. And if you’re a small business owner training those coming and going through the revolving door of the employer-employee relationship can get expensive. That disappears with outsourcing.
- No more continuity/consistency issues: because an outsourcing provider is there for you day in and day out, you don’t have to worry about the “new person” and their learning curve.
- Less stress: you can relax knowing that your finances are taking care of by competent professionals and concentrate on driving your income and growing your business.
- Internal privacy: eliminate talking about the company’s financial health around the water cooler. Having an independent outsourcing service firm gives you, the owner, more privacy when it comes to the companies overall finances.
- Fixed monthly fee: like you, Common Cents is a small business and we don’t particularly care for hourly billing either… so we do a detailed review of your files to derive a fixed monthly fee for you.
Are you ready to drive your bottom line… upward? Let’s make it happen. ~Joyce
by Joyce
Why should you outsource your bookkeeping and accounting functions? You might want to consider doing so for several reasons. For starters, maybe you’re someone who just hates math and accounting with a passion. There’s no shame in that; I will be the first to stand up, hold my head high, wave my arms in the air and scream, “I HATE ACCOUNTING!” (Okay, I’m kidding. I just wanted to get the admissions started.)
When you truly hate accounting and bookkeeping, you’re unlikely to do it well. Worse than that, you might even be unlikely to do it at all. While you can get away with poor personal bookkeeping, like not balancing the checkbook, you can’t with your business. If your business is going to thrive, you need the books kept to perfection. If you can’t do this on your own, or if you simply don’t want to do this on your own, outsource bookkeeping is a great way to go.
In-House Versus Outsource Bookkeeping
Another reason you might want to outsource your bookkeeping and accounting with a virtual accounting firm is to save money. While every business needs their books kept up professionally, most can’t afford to have a full-time accountant on staff. Outsourcing solves that problem by getting the job done through an outside provider. Now, with the assistance of the Internet, you don’t need to ship in a part-time subcontractor to do your books. You can have your books completed & reviewed virtually by a competent, trained professional… saving you money that you can put back into your growing business.
Saving Time With Outsourcing
Let’s suppose you’re like me and love (or at least, like) accounting. Maybe you’re even trained at accounting and feel you can keep your books better than anyone else. There’s still the matter of your time, which is best spent working on your business and making it thrive, rather than balancing books. And as we all know, time IS money…
by Joyce
If you own a business and are doing your own accounting then you are costing your company money. Too many owners think they are cutting costs but keeping accounting internal but the price they are paying is actually higher than hiring an outsourced accountant/accounting department.
Procedures & Professionalism
If accounting were nothing but addition and subtraction, then it wouldn’t be necessary of accountants to attend college to learn the ins and outs. Since accounting is a framework of smart business practices that ensures financial records are current and complete, it’s clear to see that it is more than just a sophisticated system of tracking cashflow.
Professional bookkeepers are not trained in accounting practices. This is one reason to hire an outsourced accounting department rather than a bookkeeper. Outsourcing to an accountant will bring needed discipline to financial operations to “close your books”.
Taxes: Laws, Breaks & Incentives
Few business owners understand the tax laws as they apply to their businesses. Payroll tax, sales tax, unemployment tax, Social Security tax, etc… they all have to be calculated correctly and paid on time. Then as soon as you learn the rules of the game, they change.
Business owners have more important things to do than pour over IRS regulations. An outsource accountant gives the owners access to an expert who is familiar with the tax laws and filing requirements.
In addition to making sure your business is compliant, accountants often have insight into tax breaks that business owners may not be aware of. Some of these can amount to significant tax savings to the company’s bottom line, savings that are more than the cost to hire an outsourced accounting department costs.
Analysis & Advice
Professional accountants can provide a level of analysis of a company’s finances well beyond what a layman could. Reports can show patterns in revenues and expenditures that a superficial examination may not have revealed. With detailed information and review, the owner can focus and develop strategic plans that will bring future prosperity.
A business owner can ask the outsourced accounting department for advice. Ranging from basic business practices that can cut expenses and increase revenue to evaluations of major expenditures, this could be huge for a small business ventures prospects of survival and growth.
The value of an outsourced accounting department is difficult to measure but almost always exceeds the cost of the operation.
Summary
In short, as a business owner, you can’t do it all. By outsourcing your accounting, payroll and tax needs to a virtual accounting department, you get back that time to use on other things… like building and growing your business.
by Joyce
Buried under a mountain of paperwork? Vendors calling you incessantly? Let’s face it, accounting isn’t fun. There are financial reports that you don’t understand, checks to prepare and mail, deposits to run to the bank and on and on. There just don’t seem to be enough hours in the day.
As a small business owner, focus on what you do best. So unless you actually enjoy tedious tasks, deadlines that never end, employees that give you that “will my direct deposit work this time” look… what you do best probably doesn’t include accounting. So pass the buck and let others do it for you.
Why should you outsource? Because contrary to popular belief, outsourcing done right, saves time and money. How? A lot of small businesses try to do everything but you have to find balance. By relinquishing tasks that don’t bring in the bucks, you garner more coveted time to focus on money making activities and save not only time but pieces of your sanity.
Check out the contestants
Before going all gung ho for outsourcing, be sure to check out your options and compare apples to apples. Ask what functions are available, what do you have to do (for example do you need to input hours, send a file, etc) and most important, know what your needs, requirements and preferences. Once you find the right fit, go for it.
“Pass the buck” downers
I would be a “Pollyanna” if I neglected to inform you of the potential pitfalls of passing the accounting buck by outsourcing. Here are a few.
- Inability to customize services so you only pay for the features you need/want.
- File swapping…you send them a file of your accounting information, they review your information and send you a file back for you to upload to your accounting software. A lot of steps, especially if you’re not a computer genius. Or if your provider is in the pre-internet age, they literally pickup the computer file as well as documents…and bring them back when the work is completed.
- Emailing files. Not the most secure way of transporting them. You may or may not have access to your accounting file to input current data while the accountant is away and if you’re impatient, merging files may be a hassle.
Picking the Buck Recipient
We can’t advocate this enough, do your research! Look around at what is available and do what works for you and your company. Some things to consider…
- Consider internal & external options – some service providers charge by the hour and others at a flat rate or per diem (as needed). Caveat: compare apples to apples.
- Consider those that will integrate with your software systems such as payroll and crm. There are distinct advantages to entering information one time.
- Consider the personality of your company. Match it to that of your service provider.
- Consider the features available, including real-time and/or virtual access, and compare them to the features you need. Don’t pay for more than what you need.
- Consider making a decision to outsource sooner than later. Believe me, you’ll be glad you did and you’ll probably wonder why you didn’t do it sooner.
Don’t forget, keep up with your service provider and spend time focusing on what you love, the things you’re good at. After all…that IS why you got into business. Right?
Common Cents Consulting and it’s subsidiary, Common Cents Outsourcing, were created to provide virtual accounting & payroll alternatives to small businesses on the go without sacrificing quality. Need help choosing an outsourcing provider? We’re happy to help…even if you don’t choose us! http://www.commoncentsoutsourcing.com/
(c) Common Cents Consulting LLC – Common Cents Outsourcing 2008
*originally published on www.ezinearticles.com
by Joyce
Before you make any phone calls, take some time to do some self-reflection. Reflect on your business and how it currently functions, what you do well and what you can do better. Then ask yourself, what functions do you want to outsource? can outsourcing help you perform some things better? and what is your budget?
Interview a few outsourcing providers just like you would if you were hiring an in-house staff person. Like choosing an in-house bookkeeper, accountant or payroll processor, ask “interview” questions. Here are
10 Questions you should ask. In addition, ask yourself if the provider’s style and available services coincide with your business’ philosophy and style. If not, you may be attempting to force a square peg into a round hole and what may have been a less expensive alternative in the beginning, may end up being a costly experiment. So choose wisely.
Quick Recap: decide to outsource; do some self-reflection on your business needs; interview a few providers (at least 2) and make a decision who your provider will be. Remember cheaper doesn’t always equal better.
Congratulations on deciding to outsource. That decision in and of itself is HUGE so give you’re some kudos for admitting that although you are a small business/solo practitioner, you can’t do it all. Believe me, as a small business owner, I can relate…
Hope this helps!
Joyce
PS. Please, keep in mind that just because you are outsourcing, you should never abdicate management…you should always keep “an eye on the store.” Your provider has a responsibility to you as a client and should take that responsibility seriously.
