Virtual services and outsourcing have become second nature in the modern business world. Outsourcing provides a win-win situation for all parties involved. Business owners experience cost-saving benefits of delegating necessary, but tedious, tasks to reliable, dependable, professional and trustworthy experts in their respective fields; this affords the business owner the opportunity focus on their core model and company growth.
Many companies contract with IT consulting firms to handle troubleshooting and technical tasks. A significant percentage of small business owners prefer to outsource their accounting, record keeping, tax, payroll and bookkeeping duties to licensed and reputable firms.
Here are some of the many advantages of outsourcing your bookkeeping tasks.
On-Site Accountants Are Costly
When you hire a bookkeeper to work on-site, you are signing on to a lot of overhead costs that you may not expect. From hourly wages to insurance costs, tax responsibilities, sick time, vacation time, holiday pay, overtime and unemployment wages, having an on-site bookkeeper or accountant is actually far more costly than hiring an outside agency to handle your records.
With an outsourced bookkeeping company, you are only paying for the services rendered. You can coordinate any type of accounting-based package that suits your needs, so you do not end up paying for unnecessary services.
Safe And Secure Data
Hiring an on-site bookkeeper gives your employee direct access to secure and confidential files. These documents may contain sensitive financial information or undisclosed information on another employee’s personal records. Additionally, most small businesses do not have the resources or capital to set up an impenetrable encryption server for sensitive information.
When you hire a large third-party accounting firm, they will most likely have an ironclad encryption program in place to protect your company’s records and the information of any other company they contract with; ask what types of security measures they have in place to protect their clients’ sensitive information if they use cloud-based services.
Tax Preparation And Audit Protection
One of the primary reasons that small businesses enlist the help of a third-party company to handle their accounting is to assist with tax-related manners. The tax code is an incredibly complex entity, and the tax laws are always changing. Professional bookkeepers are required to stay up to speed on the latest changes in local and state tax laws and regulatory mandates.
When preparing your own business taxes, it is very easy to make a simple tax mistake that could end up costing you thousands of dollars in fines and penalties. Additionally, one simple tax mistake may land you at the doorstep of an audit.
Audits can take months to complete. To prepare for an audit, you have to gather transaction information, financial records, receipts and invoices. The process is very stressful, invasive and time consuming.
A professional accountant minimizes the likeliness of being subjected to an audit. If you do get audited, the third-party bookkeeping company will prepare your documents and assist with every step of the process.
With an outsourced bookkeeper or accountant, you can gain invaluable insight into how your business is operating. Your accountant can explain how your time and money is being spent, and they can highlight areas of improvement and areas where you are excelling. This invaluable information can help you make the necessary tweaks to your business.
With an outsourced bookkeeping company, like Growth Force, you can also take a relatively hands-off approach to the day-to-day accounting aspects of the business; you can then shift your focus to your core business model, company growth and profit margins.
Outsourcing sometimes gets painted in a negative light. While some companies outsource a portion of their operations simply to cut corners and save money, many businesses look at outsourcing in a more responsible manner.
With the right partnership, outsourcing can increase your profits, save you time and money and improve relationships between clients, vendors and customers.