A Small Company Needs a Professional Accounting Firm to Be Safe
Cash flow is the blood life of every business, whether large or small. Unfortunately, many small companies overlook cash flow monitoring due to the many operations they deal with daily. Poor financial management is the reason why 80 percent of small businesses start failing within the first 18 months. Many small business owners are still struggling with managing their finance. It is a complex process, and a simple mistake can fail the business.
Accounting firms have come to the rescue of the small companies that are still struggling to manage their finances. Here are some of the reasons why small companies should outsource professional accounting services.
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- Outsourcing an accounting firm is cost-effective
Outsourcing accounting services is more cost-effective than hiring an in-house team to handle the same function. Outsourcing services do not come with the overhead costs hiring an employee generates. Health insurance, vacation, retirement, sick days, worker’s compensation, and PTOs are not there when you outsource services. A small company may also not have enough finances to higher an expert.
- Reduced fraud
Fraud is common in many small and medium-sized companies with one person in charge of all accounting activities. The reason behind these frauds is because someone can easily have fake expenses and manipulate books and go unnoticed for months and sometimes for years.
Outsourcing accounting services is the only way to curb such frauds. There are multiple pairs of eyes overseeing all transactions and reports making it easy to detect frauds on time. You can’t do away with fraud in small companies completely, but with a dedicated team of experts will detect these anomalies.
- It is a proactive approach
As the CEO of a company, you are not there to be a trained financial professional to be able to oversee books. Your work is to run the company and focus on the overall company’s vision, not just bookkeeping. Outsourcing an accounting firm is a proactive approach because you will be working with experts who will notify you about expenditures and cash flows. These experts can see red flags ahead of time and advise you accordingly. Having trained eyes overseeing your financial transactions will give you confidence and peace of mind, you need to make intelligent decisions.
- Compliance with tax laws
Tax legislation and other business laws keep changing from time to time. An in-house accounting team may be too busy to keep on checking these laws. Unfortunately, failure to comply with some laws attracts heavy penalties and fines. Outsourcing accounting services from a reputable firm alleviates the worry of complying with these laws. You will be dealing with experts, and they will inform you about these changing laws and advise you accordingly.
- Outsourcing accounting services saves time
Outsourcing accounting services free up some time allowing you to focus on other activities. Some financial transactions, such as tax filing are complex, and take a lot of time. Outsourcing these services will let you focus on providing your customers with quality products. You get time to set up new strategies to keep the company scaling upward.
Outsourcing a professional accounting firm will transform your accounting function from advanced bookkeeping, customized management reporting, to controller services. It is not about accounting only. It is also about providing you with a platform to grow your company, improve cash flows, and drive more profits.