written by: Ritchie Cruz, Principal Director
Today, the competitive nature of doing business has necessitated organizations to devise ways or reducing their costs and enhancing their services so as to gain a competitive advantage. Besides, the financial pressures of running a business efficiently adding value to the operations has forced organizations to outsource accounting services. The primary goal of outsourcing is based on the fact that, some in-house accounting aspects such as tax reporting and compliance can be expensive and divert the focus and scope of the business from their main goal.
On a global outlook, there are numerous accounting firms that provide outsourcing services. However, some of the general accounting services that can be outsourced include the following:
- Tax planning, reporting and compliance
- Management accounting
- Payroll and accounting advisory
- Financial statement and custom reporting
- Sales invoicing and vendor bill payments
- Management of accounts receivable and accounts payable
Although, most organizations have qualified and experienced staff that can manage accounting issues, outsourcing is a crucial component that “injects new blood” to the business, and provides the much needed competitive advantage. Some of the benefits of outsourcing accounting services include, but are not limited to the following:
- The process is cost effective because it helps to eliminate hiring and training costs associated with the maintenance of the entire accounting department.
- Outsourcing of accounting services provides a “cushion” and reduces the risks of business failure. Since 90% of start-up businesses fail within the first five years of operation due to lack of structures and accountability, outsourcing helps to provide a strong financial statement and the management of risk.
- The outsourcing of accounting services assures companies of data security through the use of cloud computing based accounting software, which ensures that people can access accounting records at anytime and from anywhere all over the world.
- Other key benefits include reduced staff idle time, provision and access to real time information, enhanced business continuity and compliance with statutory obligations.
In summary, the advantages and benefits of outsourcing accounting services far much outweigh the disadvantages. For this reason, firms are encouraged to outsource key accounting services if they want to remain relevant and gain a competitive advantage.
Cruz and Co offers outsourced accounting solutions – check out what suits your needs.