7 Reasons to Outsource Your Bookkeeping

February 24, 2024 by Kevin Kearney CPA

Accurate and up-to-date financial records play an important part in your business’s success, but the daily tasks required to maintain these records fall to the bottom of your to-do list. That’s understandable — you didn’t go into business to become a bookkeeper. Wading through managing employees, paying bills, making long-term decisions and analyzing costs can consume your day. Bookkeeping takes up a lot of your valuable time.

Bookkeepers are critical to keeping the back of the house running. Paying the bills on time ensures your credit score remains stellar. They deposit your checks, so you have the cash flow to pay those bills. They enter all of your transactions in your accounting system so you can generate financial statements for your management, investors, banks and creditors.

You may be considering hiring a bookkeeper to manage accounting tasks in-house as a solution, but it might not be the best solution. Below are seven reasons why outsourcing could be better for you and your business.

Savings on payroll and operating costs. Instead of hiring a new employee, you’ll keep payroll costs lower by not recruiting, training and offering benefits to another hire. Rather than funneling your payroll funds to support staff, spend more on core employees.
Comprehensive knowledge without training costs. You can rely on bookkeepers who are up to date on the latest QuickBooks features and have comprehensive knowledge of tax rules and reporting methods. Having a team working for you means you’ll have access to agents with the training you need.
Time savings and less paperwork. Logging, analyzing, and reconciling payments and other financial records takes time. No waiting for an in-house bookkeeper to settle in and adjust to your company. Outsource these tedious, time-consuming tasks and have more time for customer service, evaluating processes and improving operations overall.
Streamlined process with online portals based in the cloud. You’ll have access to your records at any time. This means cross-collaboration with centralized, organized data.
1. View your business’s financial status as money moves in and out. Expenses and income are sorted, giving you more detailed insights into your business.
2. Cash flow history, profits and losses, and your balance sheet are available for sharing with partners, employees, legal counsel and financial advisers. Quantitative insights are available.
Outsourced bookkeeping is staffing insurance. What happens when your bookkeeper quits with little to no notice?
1. Are you prepared for the unexpected disruption if staff out sick for a day, a week, or worse, permanently? Outsourcing to CironeFriedberg ensures that your bookkeeping continues no matter what.
More informed business decisions. Have the numbers to back up your instincts and gut. With financial intelligence, you can make better decisions.
1. Virtual bookkeeping helps you determine which customers or clients to invest more money in and which to stop marketing to.
2. Analyze when you need and can afford new employees. Calculate how much payroll you can sustain.
3. Use your valuable time and energy for growing your business. Outsourcing bookkeeping frees your time for what you do best.
Tax-ready and audit-ready financials. Professional bookkeeping services prepare financial records for accountants, the IRS and banking institutions. You won’t have to worry about your books’ accuracy or need to question the integrity of your financial data for investor reviews either. Simplify tax preparation and take advantage of potential tax deductions.

Maybe your bookkeeping needs are as simple as tracking cash flow. Keeping up to date on accounting tasks is essential. Outsourcing your bookkeeping services with CironeFriedberg is scalable. Services grow as you grow. Just give us a call to get us started on your books today.

HAVE QUESTIONS?

Learn more about our Client Accounting Services, designed to help keep your business operating as profitably as possible with a host of outsourced services. You can reach us by phone at (203) 798-2721 (Bethel), (203) 366-5876 (Shelton), or (203) 359-1100 (Darien), or email us at info@cironefriedberg.com.

A Strategic Solution for Businesses: Outsourcing Accounting Services

September 19, 2023 by Kevin Kearney CPA

In today’s fast-paced business landscape, organizations must maintain precise financial records, navigate complex regulations, and make informed financial decisions to thrive. However, many businesses, particularly smaller ones, find it challenging to handle their accounting tasks in-house, especially in this tight labor market. Outsourcing accounting services has emerged as a strategic solution, offering a wide array of benefits that can significantly impact a company’s bottom line and operational efficiency.

Let’s delve into 12 comprehensive benefits of outsourcing your accounting services, covering everything from bank reconciliations and billing to accounts receivable, accounts payable, and more.

1. Expertise and Specialization
Outsourcing accounting services allows your business to tap into a pool of skilled and specialized professionals who possess in-depth knowledge of accounting principles, tax regulations, and financial reporting. These experts are up to date with the latest industry trends and can provide valuable insights that may be beyond the capabilities of an in-house team.

2. Cost Efficiency
Maintaining an in-house accounting department can be costly when you consider salaries, benefits, training, and overhead expenses. Outsourcing accounting services can significantly reduce these costs, as you only pay for the specific services you require. This cost-effective approach is especially beneficial for small and medium-sized enterprises (SMEs) looking to maximize their financial resources.

3. Focus on Core Competencies
Outsourcing accounting functions allows your in-house team to concentrate on their core competencies, such as product development, marketing, and customer service. This division of labor ensures that your workforce remains focused on activities that drive growth, while experts manage the accounting processes efficiently.

4. Increased Accuracy and Compliance
Accounting errors can have severe consequences, from financial loss to compliance issues. Outsourcing firms are dedicated to maintaining high levels of accuracy, adhering to best practices, and ensuring compliance with tax laws and financial regulations. This reduces the risk of costly errors and legal complications.

5. Scalability
As your business grows, your accounting needs may evolve. Outsourced accounting services offer scalability, allowing you to adjust the level of support you require. Whether you need help with basic bookkeeping or more complex financial analysis, outsourcing can adapt to your changing needs without the hassle of recruitment and training.

6. Improved Efficiency
Accounting tasks, such as bank reconciliations, billing, and accounts receivable management, can be time-consuming and labor-intensive. Outsourcing these tasks to professionals who specialize in them ensures efficient and timely completion. This can lead to faster processing, improved cash flow, and reduced operational bottlenecks.

7. Enhanced Risk Management
Sound financial management involves effective risk assessment and mitigation. Outsourcing firms are well-versed in risk management strategies and can help identify potential financial threats. They can also assist in establishing internal controls to safeguard your financial assets and reputation.

8. Comprehensive Financial Reporting
Accurate and timely financial reporting is essential for making informed decisions. Outsourced accounting services can provide comprehensive financial reports that include balance sheet accounts reconciliation, general ledger review for proper coding, and internal financial statements. These reports offer valuable insights into your company’s financial health, enabling data-driven decision-making.

9. Interim Staffing and Assistance
Outsourcing firms can offer interim staffing solutions to fill temporary gaps in your accounting department. Whether due to employee turnover, maternity leave, or seasonal spikes in workload, outsourced professionals can step in seamlessly, ensuring uninterrupted financial operations.

10. Assistance in Filling Open Positions
Recruiting and hiring accounting professionals can be a time-consuming process. Outsourcing firms can assist in recruiting and evaluating candidates for permanent positions within your accounting department. This collaborative approach ensures that you select candidates with the right skills and cultural fit for your organization.

11. Reduced Fraud Risk
Outsourcing accounting functions can help mitigate the risk of internal fraud. External experts provide an additional layer of oversight and accountability, reducing the opportunity for fraudulent activities within your organization.

12. Access to Advanced Technology
Outsourcing firms typically invest in advanced accounting software and technology. By outsourcing your accounting needs, you can leverage the latest tools and resources without upfront investment, ensuring that your financial processes remain efficient and up to date.

These 12 benefits demonstrate how outsourcing accounting services offers a comprehensive solution for businesses seeking to enhance their financial management and operational efficiency. From cost efficiency and expertise to scalability and risk mitigation, the benefits of outsourcing are diverse and impactful.

Outsourcing your accounting services can unlock the full potential of your business’s financial management capabilities. By partnering with experienced accounting professionals, businesses can optimize their financial processes, reduce costs, improve accuracy, keep payroll low, and make well-informed decisions. Today, outsourcing accounting functions is not just a strategic move, it’s a vital step toward ensuring financial stability, growth, and long-term success.

Learn more about CironeFriedberg’s Outsourced Accounting Services.

Have questions?

If you need assistance or have any questions on the information in this article, please call your CironeFriedberg professional. You can reach us by phone at (203) 798-2721 (Bethel), (203) 366-5876 (Shelton), or (203) 359-1100 (Darien) or email us at info@cironefriedberg.com.

Know the Difference Between Cash and Accrual

July 1, 2022 by Adam O'Feeney CPA

Every business has to keep track of cash flow, but there’s more than one way to do it. Review the basics before you decide what the appropriate method is for your business.

Cash method of accounting

In this system, you record income as cash is received and expenses as cash is paid out. You don’t make a note of any invoices or bills you send, but instead record income when you actually have the money in hand. Cash accounting is convenient and reliable, allowing management to keep tabs on revenue and expenses without a great deal of bookkeeping. You don’t have to pay income tax on any money that hasn’t been received yet, helping improve cash flow and ensuring that your business has funds available for tax payments. If you’re a sole proprietorship or a very small business, this keeps your business afloat when cash flow is restricted.

If your business has average gross receipts of less than $26 million over the previous three years (or over the period of existence if less) and doesn’t maintain large inventories or sell merchandise directly to consumers, the cash method of accounting might be the best choice for you. It’s a simple system, similar to how you might track your personal finances.

Of course, there are disadvantages. It’s hard to tell whether high cash flow in a particular month is a result of work done in that month or you’re receiving delayed revenue from a previous month. And there are no records of accounts receivable or accounts payable, creating difficulties when you don’t receive immediate payment or have outstanding bills.

Also, it doesn’t conform to generally accepted accounting principles, the standard framework that accountants must adhere to when preparing financial statements. If your business really takes off, you’ll have to update your accounting practices. If you think you could get larger, then you should consider the accrual method.

Accrual method of accounting

This system provides a clearer picture of a company’s overall finances. The business records income when it is earned and expenses when they are billed, no matter when the money is received. This gives business owners a longer-term view of how the company is faring, showing how much money it’s earned and spent in a specific time and providing a clearer gauge of when business speeds up or slows down.

Even though it requires more intensive bookkeeping, accrual accounting gives owners a more realistic idea of income and expenses over a specific time, providing a better understanding of consumer spending habits and allowing you to better plan for peak months. Its complexity may mean you need some bookkeeping help, either in-house or outsourced.

Also, the system may give an inaccurate picture of your short-term financial situation. You’ll have to track cash flow separately to make sure you can cover bills month to month because accrual accounts for money that hasn’t come in yet. Indeed, you need very careful bookkeeping practices; your books could show a large amount of revenue when your bank account is empty.

Which method you choose is ultimately a management decision, depending on your business goals, the resources you have available, and your firm’s size and financial requirements. It’s wise to speak with an accountant and tax professional in your decision-making process.

As a business owner, you need to focus on growing and tending to your business. Put the accounting in our hands. CironeFriedberg’s Outsourced Financial Services team can provide accounting solutions tailored to your needs. Learn more about our Client Accounting Services and how they may fit into your business.

7 Reasons to Outsource Your Bookkeeping

HAVE QUESTIONS?

A Strategic Solution for Businesses: Outsourcing Accounting Services

Have questions?

Know the Difference Between Cash and Accrual

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