Advantages of outsourced bookkeeping
Today, many business owners increasingly prefer to outsource the bookkeeping work of their company. The advantages in monetary savings over a full-time accountant are obvious. But is it only money that makes a difference?
- One of the main advantages of outsourced bookkeeping is the high degree of responsibility. In this case, there is no need to control the work of the bookkeeper. The management of the company can concentrate on solving important tasks, while the outsourcing company will deal with everything related to bookkeeping.
- A full-time bookkeeper may quit at any time, and mistakes in their work may appear later (sometimes much later), so there is simply no one to complain to. In the case of cooperation with an outsourcing company, such problems do not arise. If the company changes employees, this does not in any way affect the responsibility before the clients.
- It is also worth considering that after a full-time bookkeeper quits or you are forced to fire one, the company’s management will need to spend time recruiting a new employee. With outsourced bookkeeping, such problems do not arise; you do not waste time looking for the best specialist. You will be served by a bookkeeper whose qualifications and experience are most suitable for solving your problems. All the employment issues – office, workplace arrangement, sick leave, vacations, layoffs, etc., disappear.
- The outsourcing company has a large amount of knowledge and experience. It serves many companies in various spheres and is well versed in bookkeeping laws. Bookkeeping companies are also the first to find out about the advances in related technology.
When analyzing the benefits of accounting outsourcing in a particular situation, it is worth considering whether an outsourcing company can provide the services you are looking for. One should also keep in mind the possibility of partial bookkeeping outsourcing, which is the outsourcing of certain accounting functions: payroll bookkeeping, preparation of financial reports, filing tax returns, etc.
The reason for the partially outsourced bookkeeping is the desire of the manager or owner to maintain control over accounting processes. Also, the services of partial outsourcing are used by those companies that want to relieve their employees from routine work in the presence of a large number of the same type of tasks or plan to reduce the accounting staff.
When is outsourcing necessary?
Bookkeeping services are necessary when starting a business. At the very beginning of the business activity, it does not financially make sense to hire an in-house bookkeeper. At the same time, the company’s growth and development require a strong bookkeeping base, which will need to be strengthened and improved over time. In this case, an outsourced bookkeeping company can provide only required services and as frequently as needed (e.g. weekly basis).
Also, outsourcing can be used by companies that do not need the constant presence of a bookkeeper. Sometimes outsourcing is also used by those who need daily services – even in this case, outsourcing will cost less than having the same amount of tasks be performed by a highly qualified in-house bookkeeper. Outsourcing is also used:
- when the main specialist goes on vacation or sick leave
- if there are difficulties with the preparation of reports
- to understand how the changes in legislation should be applied
- if the head of the company needs to check the work of the accounting department.
As you can see, there are various reasons to use outsourced bookkeeping. Increasingly, entrepreneurs are asking for tax optimization (finding the best ways to minimize the size of tax payments and fees to be paid to the state or local budget) and restoration of bookkeeping records (eliminating gaps in bookkeeping based on available documents and data, correcting detected errors, etc.). If necessary, the company’s specialists can participate in resolving disputes – representing the interests of the client during tax audits, communicating with the IRS, and so on.