9 Important Benefits Of Outsourcing Your Accounting Functions 19 Dec 2020
Outsourcing Your Accounting Functions
As someone who is putting so much effort and toiling hard to improve the company’s growth and efficiency, and is leading the business operations – how do you make decisions that are right?
How do you develop decision-making and strategic business traits, and determine the achievable path to victory?
From where do you access the information you require to direct your company into the future?
And what do you do if the data you have is incomplete and clouds your decisions?
If you are confronted with financial and accounting hiccups and see an opaque path to achieve your business goals, it is high time you consider outsourcing your finance and accounting business functions.
What is accounting outsourcing?
Accounting outsourcing is partnering with a bookkeeping and accounting service provider – like Velan – to look after your business’s accounting and financial tasks.
Accounting and bookkeeping services will depend on the software and the service provider, however, as a business owner, you get to decide which financial functions you want to outsource and what you would like to keep in-house. You can choose the services based on the objectives you are looking to achieve from your outsourcing partners.
Most importantly, you can decide as to what level of access you would like to have to the accounting software that you would be exposed to.
Why should you outsource your accounting functions?
The reasons to outsource could be plenty, nevertheless, the benefits you could reap from outsourcing will be outstanding.
Outsourcing your accounting function was initially passing over accounts and finance management. Nevertheless, with the genesis of advancements in FinTech and the use of automation via the cloud, outsourcing has earned a new dimension where accountants manage the business’s accounts and finances, involve in decision-making, drive the company’s efficiency, and adds overall value to the ROI, all without the need to have an accountant team.
There were two conventional roles of an outsourced accounting team: functional and reporting. The two core roles are the same except that they are run by leveraging advanced technology and cloud software.
- Functional support verifies that the input given to the accounting systems is correct. For example, uploading sales and purchase invoices, receipts, payments, and other data capture. With the involvement of automation, the tasks can be effectively done live and help with other daily tasks needed for business operations.
- Reporting aids in successfully filing the reporting period, settling month-end balance sheet accounts, and reviewing the postings before producing management information and building board packs. With customized reporting options in the advanced software, key performance indicators, trend analysis, cash flow forecasting, and benchmarking will help management comprehend the business’s performance from every dimension and influence the management with making the right decisions for the company.
Benefits of outsourcing your accounting functions
1 – Better and faster business decisions
The potential to offer accurate accounting information efficiently and with greater effectiveness is important. When you work with accounting professionals, they will help you yield more authentic and definitive information to make improved business decisions fastly.
You will reduce the cost and time to keep abreast of a blizzard of new policies, laws, procedures, and the latest technologies. In today’s competitive market, you cannot afford to miss critical business cues and fail to update yourselves with the latest financial laws, and accounting professionals will eliminate the need for it.
2 – Cost-saving accounting services
It is a myth that outsourcing is an additional expense, and it increases their expenditure. And we are strictly telling it is not.
Outsourcing is cost-effective, and every business that wants to operate efficiently at a lower cost must prefer outsourcing.
Outsourcing eliminates the need for you to set up an in-house team, benefits, payroll, and infrastructure. Instead, you can outsource your accounting functions to a service provider that already houses specialists and the expertise to allow you to run your business effortlessly.
Outsourcing will give you the liberty to focus on the return of every dollar you would spend and prepare you to deploy resources where you could maximize their expertise. And do not forget the quality and accuracy of work you will receive from an expert as opposed to the in-house team if they are beginners or less experienced. You will only pay for the services you need. There will be an increase in your productivity and zero distraction and worry.
3 – Cut back on risks
Reporting errors, penalties, interest rates for payroll, and income tax errors are expensive. Litigation expenses and judgments levied against an organization can pull down a business overnight.
You can certainly avoid these risks when you place your business’s accounting responsibility on trained professionals. Your outsourcing partners will come up with a customized plan, systems, processes, and strategies for your business, which you can be sure of. And since they are the experts, you can expect the payback period to be shorter and benefits with transparent, efficient, and reliable.
4 – Save your Time
As your business grows, you will need more time to scale your business than learn to account, or train a team. And you will be one step ahead in scrutinizing your business data more carefully. Hence, outsourcing your accounting functions will give you the energy, freedom, and time to focus on business to create better strategies and increase your ROI. Besides, you can invest your time in business development activities like networking and attending important business events.
5 – KPIs focussed
An outsourced team takes into account your KPIs for their reporting and delivery. KPIs are a combination of commercial, financial, and team-based data. Your outsourced accountant will extract and evaluate the data on the basis of your business’ objectives, and discover the additional information you would need to track progress. You will also get expert suggestions for reporting formats.
6 – Benchmarking
When you outsource your accounting functions to an external team, your accountant will give you insights about your competitor’s data collected from his research. You can leverage that data to your benefit by setting a benchmark and outdoing your competitor’s targets. This process will ensure you are always on an increase when it comes to revenue, profit-making, and cutting on overhead expenses against your competitors in the industry.
7 – Comply with 100% business compliance
Professional accountants always stay abreast of the latest regulations and policies. They are cognizant of what is happening in their industry and always monitor regulations to stay updated. You can be free of this stress and trust your accountant to be fully compliant with your business.
8 – Access the latest technology
Outsourcing teams breathe their day in and out with accounting functions. And you can be sure that they would have all the required and latest equipment that they could take advantage of to manage their clients. And technology and software is a huge step.
Without having to invest much, you get access to complicated data and reports fetched using the latest technology. In addition to the basic financial information, you can get additional information from your accountants, which otherwise could have cost you thousands of dollars.
9 – Get additional services
If your outsourcing partner offers additional services like tax, retirement, payroll management, etc., and if there is a need for those services for your business, you could easing sign up for those services and leave your entire financial gamut to a single provider.
It will create a room for wealthy servicing, lower cost, and peace of mind for you and your business.
Hence, by outsourcing your accounting functions, you get access to quality and accurate results in addition to the time you need to scale your business so you could focus on more revenue. With the help of an accountant, you could make strategic, nimble decisions that will be backed up by results.
Velan offers professional accounting and bookkeeping services that will help you keep your business focused on your main objectives. We create bespoke financial and accounting systems based on informed strategies coupled with exemplary customer service. A Velan expert is happy to discuss accounting solutions for your business requirements and handhold you to maximize your business opportunities and revenue.