Full-time vs. Outsourced: Which Type of Accounting Service is Best For Your Business?
As a business owner, there may have been many times when you’ve had to sit down, polish up your Excel skills and manage your own bookkeeping and business finances. But when you have clients to meet, services to deliver and products to develop and sell, being held down by profit and loss and payroll duties isn’t ideal.
If you’re thinking about hiring an accountant to manage the load for you, you have a couple of options open to you. You could hire a full-time bookkeeper or accountant that sits in the office every day crunching numbers, balancing the books and preparing your taxes, or you might prefer to outsource the role on an as-needed basis. There are benefits to both and the option you choose will largely depend on your business model, current position and of course, the budget you have available.
In this article, we’ll give you the lowdown on how to make a decision that allows you to focus on your core business while your finances are managed like clockwork.
Accountant or Bookkeeper?
Before you start to look at the benefits of using an in-house accountant or outsourced accountant, it’s important to consider whether you need an accountant or a bookkeeper. If your business is relatively small, you don’t need to manage a large payroll or comply with certain financial restrictions or regulations and your tax is fairly straightforward, a bookkeeper may be more than enough to suit your needs. If you have plans to apply for venture capital and other sources of funding, you are growing quickly and employing lots of staff and your tax requires expert management, you might want to consider a qualified accountant.
In-House or Outsourced – How Do They Compare?
Time to Hire
Hiring the right in-house accountant can take time. The talent may be out there waiting, but it might take you weeks and even months to find the right person. However, finding an outsourced accountant or outsourcing company that you gel with and that can hit the ground running could take you a matter of days.
When you hire an in-house accountant, you have immediate and direct access to financial advice and your current position whenever you need it. While an outsourced accountant can give you the same answers, you may have to wait 24 hours or longer to receive them.
Let’s face it, money can be thin when you’re running a business. When it comes to cost, outsourcing wins hands down in every category. Not only will you save on salary costs, HR overheads and software costs, but you will also have better control of your budget as most outsourced accountants charge a fixed monthly fee. They also supply all software and you won’t have to pay them when they take a day off.
As your business grows, you may require more specific and specialized accountancy services. These requirements may go beyond the capabilities of an in-house accountant. A good outsourcing company, on the other hand, will have a broad range of experts with up-to-date knowledge who can help you in your hour of need.
The last thing you want when hiring any service or employing a member of staff is to think about the risk involved, but both outsourced personnel and permanent employees can bring a degree of it with them. When it comes to hiring an outsourced accountant, you’re not using somebody that is right down the hallway or who is only dealing with your business. And when you’re using an in-house accountant, their errors are your errors and you also need to ensure they have current certification and that they understand regulatory statutes.
Whether you choose to hire an in-house or outsourced accountant, the fact is, you need to keep your finances in order. For startups and established small businesses growing surely and steadily, an outsourced service may be the best option in those early days. As the business continues to grow and you need to start considering pitching for funding, opening new offices and managing a large payroll and complex taxes an in-house accountant will prove to be a good asset.