All small businesses must face the same question: whether to do their accounting work in-house or outsource it to others. While paying someone else to do accounting for you involves a cost, it also saves money in other ways. How can this move actually reduce your costs? Here are five key ways.
1. Avoid Additional Payroll Costs.
The hourly wage you pay someone to do your books doesn't represent the full cost of employing them. You must pay payroll taxes like FICA and unemployment insurance. Your business also pays other necessary costs like workers compensation and benefits as well as equipment for the employee to use. By hiring an outside firm, you get rid of all these ancillary payroll expenses.
2. Reduce Fees and Penalties.
Many elements of accounting are highly regulated and overseen by multiple state and federal agencies. Failures like missing deadlines, underpaying taxes, or miscalculating obligations could result in additional fines, penalties, interest, and other costs. From bank overdrafts or NSF checks to fines for misclassifying employees, these avoidable costs add up. A professional can help you prevent them.
3. Prevent Fraud or Abuse.
Misuse of funds by those with access to various accounting functions can be tempting for many. There is cash on hand, company checks, and various sources of money in other forms. Books can be changed to hide intentional or accidental fraud. And without good oversight, these issues may go on for years before being noticed. Outside accounting services provide checks and balances that reduce opportunities for abuse.
4. Tailor the Time Spent.
It can be hard to know how much time your staff needs to spend working on accounting. This time may vary depending on various cycles of the week, month, or year. But an employer usually can't change the employee's hours or position every week to target their payroll dollars better. When you outsource this service, you have more control to scale up or scale down what you're paying for.
5. Avoid Liability Risk.
The more sensitive information you have in your possession, the more risk your company takes on. You'll have to physically secure facilities and maintain the best cybersecurity as well. And your security is only as good as the employees who have access to data. By offloading this risk to a professional service, you let them take on the liability for you.
Which of these benefits could help your small organization save money? Whether you want to avoid extra costs, streamline payroll dollars, or better target your actual needs, hiring a professional accounting service could be the answer. Learn more by meeting with an experienced accountant in your area today.Share