Is Now the Right Time To Outsource My Accounting?

A guide to help you decide if it’s time to take that plunge to outsource accounting services for your business

As a business owner, your time is stretched exceedingly thin. Customer demands, product/service development, market trends, employee matters… you’re pulled in several directions as it is. Your accounting is probably the last thing on your mind.

Yet you’re balancing your books yourself and struggling to keep up. Or maybe you have an employee doing the work, but they’re also covering office management, human resources… you get the idea.

But your financial health is much like your physical health: Ignore it, and problems will fester. Your accounting deserves the attention of knowledgeable, experienced professionals.

So how do you know if it’s the right time to bring in outsourced accounting services?

What does outsourced accounting include?

Simply put, an outsourced accounting service handles your accounting functions. This can include some or all of the following:

  • Maintaining general ledger
  • Processing checks and payments
  • Payroll processing
  • Accounts receivable and payable
  • Recording receipts
  • Preparing month-end adjustments
  • Preparing financial statements
  • Overseeing annual audit preparations
  • Tax work (filing returns, preparation of W-2 and 1099 forms, etc.)
  • Holding regular meetings to review activity and statements

How many of these tasks you offload to an outside accounting firm depends upon your company’s needs and the capacity of your staff.

There are numerous benefits to outsourced accounting services. Once you see how they can help your business, however, you’ll have more aspects to consider.

What’s involved in making the transition?

That’s a great question with no one-size-fits-all answer. Onboarding can take anywhere from 2 weeks to 3 months, depending on your situation:

  • How big is your company?
  • Do you want help with just one or two accounting functions, or the equivalent of a full department?
  • What’s the current state of your books?

In general, the wider the scope of work (or the more cleanup needed in your financial practices), the longer your transition period.

It also depends on how you want to handle this change. Some clients want a quick shift to outsourced accounting services. We often see that when their business has grown rapidly or they just realize they want to focus on their business.

Others actually want a slower transition; they might have employees resistant to change or new software being implemented.

Regardless of speed, it’s important to consider the comfort level of your staff when bringing in outsourced accounting services. Respecting their concerns and addressing them makes the process easier and helps establish a trusting relationship.

How much do outsourced accounting services cost?

Again, there’s no universal answer here. Your fee will depend on a number of factors, including:

  • The scope of services you need
  • The size of your business
  • The number of transactions you make per month
  • The number of credit cards your company holds

With so many variables, the pricing possibilities are vast. That said, a helpful correlation is to think about the price of an employee.

Your monthly service might roughly equal the salary of an in-house accounting manager or controller. However, you don’t have to pay an external accountant benefits, PTO, payroll taxes and other employee expenses. You also don’t have to worry about coverage in their absence. An outsourced accounting services provider handles all of that for you.

The fact is, the work has to be done. You can pay someone in house to do it, which includes all the extra employment costs (and takes them away from the work your company actually does). Or you can hire an outside firm and free up your staff to focus on your business.

What if I need help but can’t afford outsourced accounting services?

Don’t worry—there’s help available! It all depends on the level of involvement you need and want.

As we stated earlier, there’s a long list of services an outsourced accounting services firm can provide. For example, you might hire a firm to only focus on producing your month-end statements or processing checks and payments.

You’ve got other options as well. Maybe you have a strong internal team, but you just want peace of mind that your finances are sound. In this case, you might be interested in after-the-fact services. The CPA firm can look at your staff’s work to make sure it’s accurate and properly coded. They can then provide a set of financial statements.

And sometimes, clients just need a little nudge or guidance here and there. You can get this with hourly consulting services. A firm can review your processes and make recommendations, help you put together an accounting infrastructure, help you find the right accounting software, etc.

This advisory role of outsourced accounting services gives you budget-conscious flexibility that points your business in the right direction.

Establish lasting success with the right firm

The goal of outsourced accounting services is a lasting relationship to help your business succeed for years to come. So make sure you go into the process with the mindset of seeking a long-term, stable solution.

Your accounting firm isn’t there for a quick fix; both up-front work and long-range planning have to be done. Hopping from company to company will set your business back each time as you introduce new procedures and people time and time again.

So do your research and find a firm with stability, longevity and a solid track record of client service and success. Make sure they have experience working with companies like yours, considering your size, your industry and your culture.

Get help from accounting professionals

James Moore’s outsourced accounting services team can put its breadth of experience to work for your business. Contact us today to see how.