The Benefits of Outsourcing Your Bookkeeping and Accounting
All businesses, regardless of the size, do bookkeeping and accounting to manage their revenue and expenses. Some companies hire a whole department of CPAs to manage this, while others can get by with only one employee dedicating a portion of their time to it. But there’s another option, with some great benefits: outsourcing your bookkeeping and accounting.
Save money. Employees are expensive. In addition to their salary, you’re footing the bill for a portion of their social security and income tax, paying for and maintaining their equipment, and spending money on office space to provide a place to work. You might even be required to pay for their health insurance. Costs add up! When you outsource jobs like bookkeeping to a contractor or an outside firm, you eliminate these extra costs and only pay for the professional service.
Focus on your business. When you’re distracted with the little things - things that you’re not an expert at doing - you are losing time that you could otherwise dedicate to doing what you do best. Back-office functions like bookkeeping are incredibly time-consuming and distract from the work that you are skilled at. By outsourcing your accounting needs, you will have more time to grow your business.
Skilled and focused work. A professional bookkeeper/accountant is far more skilled at these tasks, and will be more knowledgeable about tax-deductible expenses to save you more money at tax time. Outsourcing your bookkeeping and accounting to a skilled individual or firm is putting your books in the hands of someone who knows the best practices and can implement them to your company’s benefit.
Fewer costly mistakes. As your business grows and your company receives more revenue, the complexity of your bookkeeping also increases. If your expertise in accounting and bookkeeping is basic-level, the increased complexity of managing your money can lead to costly mistakes, including improper tax reporting that may put you at risk for penalties in the case of an audit by the IRS.
Scalability and resources. With the use of a firm for your outsourced bookkeeping and accounting, you usually benefit from their use of the top tools in the industry, such as expensive bookkeeping programs that keep up with changing laws and regulations. And since most firms offer different service packages, you can increase your outsourced work or scale back far more easily than if you employed CPA(s) in house.