How to Tell When You Need Third-Party Accounting Support
Businesses and nonprofits need to weigh the benefits of in-house versus outsourced accounting support to determine which model is best for them. To make a wise decision, it is important to look not only at the more obvious hard costs but also at easily overlooked costs—including opportunity costs.
What is the real cost of in-house vs. outsourced accounting?
The first and most obvious cost to consider is the hard cost of in-house versus third-party accounting services. This includes not only employee costs compared to contractor costs but also the cost of maintaining on-site equipment to support your accounting team.
Many organizations find that outsourcing some or all accounting services can save money in the long run, but you will need to run the numbers to see what makes the most sense for your business.
What is the value of your time?
Another cost to consider relates to your time and where you choose to spend it. How many hours each month are your accounting team—and other employees—spending on accounting tasks, and could their time be better spent on more business-forward initiatives?
Careful tracking of employee time sometimes reveals that a surprising amount of time is spent on finance-related tasks that could easily be outsourced. Then the question becomes how those employees’ time could be better, and more profitably, be spent to help the organization grow and be more successful.
Are you missing out on valuable reports and forecasts?
Small organizations in particular often have owners and other executives working on bookkeeping and accounting-related tasks. They might be able to do the basics, but it is important to consider what value-added services they might be overlooking that could help the organization.
For example, accounting professionals can provide weekly cash flow forecasts that provide an early warning of positive and negative cash situations and offer insight into when funds are expected to come in and be paid out. These and other forecasts provide information that can translate into real savings.
Outsourcing to accounting professionals can result in other upgrades. For instance, more detailed, real-time reports can identify issues and opportunities that lead to better business decisions. Better audit preparation can also save hours of time and costs.
Is it time to outsource?
Insero & Co. can help you weigh the benefits of staying in-house versus transitioning to a third-party accounting service. If it’s the right step for your organization, we can help you get started.