When Denver businesses find themselves at a crossroads, managing finances can become more difficult. Whether regulations have become more intricate, strategic growth has become a bigger focus, or managing a team has gotten more difficult, outsourced accounting can be a viable solution. While some may be ready to hire a Financial Controller or CFO, others may not have the need or resources to make such an investment. This is where the outsourced model can create significant value by providing access to seasoned professionals, as needed, to keep accounting functional. Beyond immediate needs, there are several signs that an organization should consider outsourcing. To help clients, prospects, and others, WhippleWood CPAs has provided a summary of the key details below.
- Business is in a Transitional Growth Period – When a business starts, it’s not uncommon for the business owner or one of the partners to handle many of the financial aspects of the organization. However, as the organization grows, more staff need to be hired to free up time for more strategic tasks. While the business may not be large enough to warrant a full-time CFO, it could benefit from part-time services at the same level.
- Too Much Time is Spent on Accounting – Companies with small accounting teams may also find that too much time is spent on organizing daily tasks for accounting, including payroll, tax prep, and bookkeeping. Bringing in outsourced team members for everyday tasks or handling larger, big-picture projects are two ways organizations can free up staff time.
- Too Much Time is Spent on Hiring and Management – It can also be difficult to fill the number of positions a business needs to successfully complete all necessary accounting tasks. According to the National Center for Education Statistics, undergraduate enrollment in all fields dropped by 13% between 2012 and 2021, and a recent AICPA study found that 47,000 students received an undergraduate degree in accounting in the 2021-2022 academic year, which was a 7.8% decrease from the previous year. Hiring and retention can be a struggle for companies looking for accounting help. Outsourced accounting can be a great resource to fill the gap.
- Business is Missing Important Deadlines or Making Mistakes – Being strapped for time with accounting tasks can also mean that businesses can file taxes late, complete financial reports with inaccuracies, and miss other important deadlines. To err is human and the truth is that it happens. However, when mistakes are made consistently it is a strong signal that help may be needed.
- The In-House Team Lacks and In-Depth Understanding of Financials – Once the business reaches a certain level, financial reporting and accounting tasks become more complex. This can mean missing out on important insights that can improve performance. Working with a more sophisticated financial resource can help companies uncover previously underappreciated data points.
- Business is Not Using Modern Tools – Legacy accounting software can slow down key business processes, preventing future growth and efficiency. Outsourced accounting services can usher in new, modern accounting software for the business and even train in-house employees in how to use it most effectively. Older tools can also pose additional security risks if they lack the controls needed to counter modern attack vectors.
- Looking to Balance Budgets – Even if businesses can hire adequate in-house staff, the costs associated with training, management, retention, and hiring to solve any turnover can be significant. Outsourced accounting is priced based on how much help a business needs based on hourly or packaged rates, preventing overpaying without sacrificing quality.
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Outsourcing provides a cost-effective option for Denver businesses seeking to augment current needs or enhance the accounting function. How can outsourced accounting help your business? There are so many ways it is difficult to count. If you have questions about the information outlined above, or need assistance with outsourced accounting, WhippleWood CPAs can help. For additional information call 303-989-7600 or click here to contact us. We look forward to speaking with you soon.