Why Outsourced Accounting and Bookkeeping Can Help Your Business Grow
As a business owner or a manager, you’re not just responsible for production or operations, but you’re also expected to keep an eye on your finances and accounting. It’s not an easy job, but you know how important it is to get accurate and timely accounting.
According to a U.S. Bank study, 82% of businesses fail due to cash flow problems. It confirms the need to monitor your company’s budget, overhead, and other pertinent expenses.
However, as your company expands, you’ll find yourself investing more of your time building the core business and spending less in day-to-day activities like accounting. If you hired a bookkeeper who can only handle accounting for microbusinesses or startups, they might find it difficult to adjust to the volume shift.
Many business owners and managers outsource accounting management and bookkeeping to cope with their growing enterprise. You might want to try it, too. In this blog, let’s talk about the benefits of outsourced accounting and why your fellow business managers are doing it
Why Outsource Your Bookkeeping?
Outsourcing your accounting tasks involves hiring a team to handle everything like day-to-day transaction coding, accounts receivable and payables, payroll, and taxation. It frees up your employees from the added responsibilities that come with an expanding business.
Here are some common reasons companies outsource their bookkeeping:
- Assess cash flow issues — Reduced cash flow can force companies to make decisions about where to save up. Since accounting is not a core process in many companies, they may lack the capability to decide strategically on financial aspects—something that accounting experts are taught and trained to do.
- Prepare for additional funding — When your business is mature and ready for expansion, it may require additional financing from banks or other lending institutions. Accurate, comprehensive, and timely financial reports will be required. Experts and finance specialists from your partner company will be able to handle this task exclusively.
- Attract investment capital — Investors may start looking at your company with enhanced interest, so it’s important to show complete and accurate financial reports. Thorough financial reporting may sway them to invest in your business.
- Manage sales growth — If your company’s sales are doubling every year and the cash flow is increasing, it means more resources are needed to handle the revenue. Outsourcing accounting ensures that every aspect of the business is still taken care of.
- Changes in accounting functions — CFOs may be pressured to raise the standard of compliance in accounting legislation and principles. Partner companies can help your business make those changes happen while streamlining the process.
- Adapting to technology — Accounting technology also advances as the world quickly becomes digital. A growing company will not want to be left behind. However, it can be resource-draining to keep up with these advances. An advanced outsourced accounting company offers state-of-the-art services to get your business up to speed technologically.
What Other Benefits Can You Expect?
Outsourced accounting companies also offer other services that add value to their primary service. Quadrant Advisory, for instance, provides forecasting, financial reporting, and consultancy on top of basic accounting and bookkeeping.
Below are other benefits:
.1. Up to date — In the ever-evolving world of tax and legislation, a handful of professional accountants may not be enough. Accounting firms keep themselves updated on all areas of accounting.
2. Expert training — Growing companies depend on top-notch financial specialists. It’s more cost-effective to hire an entire office trained for this job than a small in-house team. Financial and accounting firms make sure their specialists are trained well.
3. Changing workload — Whether it’s the end of the year or some unexpected circumstances happened, your company’s workload may change. If the business doesn’t have enough manpower or preplanned resources, it could spell disaster. An accounting firm can help you allocate extra resources for more time-consuming tasks.
4. Solutions to urgent problems — If your company has encountered urgent money-related or legislation problems, you can save a lot of time and money by getting sound advice from your outsourced accounting firm. They can provide effective compliance solutions and strategies.
5. Cost reduction — Hiring new employees can be expensive. Not hiring an in-house accountant lets your company save up on fringe benefit costs like health insurance and worker’s compensation. This saved income can be allocated to hiring someone who can strategically advance your business.
By partnering with a trusted accounting firm, you’ll be able to have your key employees focus on nurturing business relationships or come up with innovative ways to create a better product.
What Should You Do Next?
If you think outsourcing your bookkeeping tasks will allow your company to take the next big step to growth, contact us at Quadrant Advisory. Our company has cross-functional experience in multiple industries, from non-profits to startups. We can help you no matter what your business is.
You may also visit our services page to see if we can help your business in other ways.