Are Your Business’s Financials Keeping You Awake at Night?

Savvy business owners understand that accurate and reliable accounting is essential to keeping their companies healthy and profitable but putting together the right combination of staffing talent and skills in the finance department is a challenge, particularly at a growing company.

Today, there is an added layer of complexity to consider as the nation collectively returns to the office after the COVID-19 crisis. Laid-off or furloughed staff members may decide not to return, or you may recognize an opportunity to reorganize and create a leaner, more focused staffing profile.

Consider these signs that it could be time for you to look at outsourced accounting services:

That I’m-in-trouble moment: The company has missed a filing deadline and/or provided inaccurate information in terms of payroll or taxes, for example. Most likely, you didn’t know the deadline or correct information. Even worse, the bookkeeper or accountant may not have told you. So, now the state and/or Internal Revenue Service (IRS) is knocking at the door.

Staffing challenges and changes: Your bookkeeper who has been with your company for 30 years is retiring. Now what? Or the search, resume review and interview process to land a new staff member with the financial experience you need has lingered too long and now your business financials are diverting your attention from other pressing matters.

Wearing the bookkeeping hat too often: As a business owner, you realize that you’re spending too much time on accounting when you need to devote more time to managing the actual business. That could be driven by a spike in sales or the inability to fill finance staff positions. You are at a point where you feel like bookkeeping has taken over your life, and you can’t spend time doing your job. You are doing accounting.

Outgrown “off the shelf” software: When you’re running a growing business, changes are to be expected. Many times, that little accounting software program you started with no longer has the flexibility to sync and share data with other financial applications. Managing the month-end close process has become a time-intensive exercise in manual spreadsheet manipulation, and your financial reports lack pertinent details you need to secure additional capital.

Need to be more strategic financially: Aside from day-to-day accounting assistance, you may find that you need controller-level or CFO-level help. Whether your business is a startup that doesn’t have the staff to help prepare for future funding rounds or an established company that could use high-level financial services and reporting, outsourced controller and CFO services can help you execute a strategic and cost-effective plan.

Taking the Plunge

It may seem risky to try something new like outsourced accounting when you’re in a difficult situation. If the financials are in disarray, or you’re just feeling like something is wrong but you can’t put your finger on it, it’s natural to hesitate about bringing in an outside team that doesn’t know your business. Moreover, you don’t want to lose control or compromise the communication flow you must have with your finance staff.

But consider that an outsourced accounting team has the expertise and the objectivity to identify the issues quickly – with no ramp-up time for training – and apply the right level of technical know-how to get you back on an even keel. Most importantly, you have bypassed the delays involved in searching, recruiting, hiring, and training an internal finance staffer.

Additionally, most outsourced accounting providers communicate with their clients daily and are available to clients at any time to answer questions or discuss concerns.

Outsourced Accounting Spectrum

Outsourced accounting services fall along a spectrum from the transactional to the strategic. On the transactional end are everyday functions like A/P bill payment, A/R collections, reconciliations, recording of outside payroll, general ledger and trial balance, financial statement preparation, bookkeeping, 1099 preparation, and sales and use tax. On the more strategic end are controller-level and CFO-level functions such as budgeting, cash flow analysis, financial statements (compiled), customized reports, monthly close, financial strategy and modeling, market analysis, business planning, tax consulting, due diligence, corporate financing, and industry benchmarking.

Outsourced accounting services can be billed by the hour, on a fixed rate per month, or by project, depending on the scope of the work. For example, a one-time clean-up of bank registers may be billed by the hour, whereas ongoing bookkeeping and financial statement preparation may fall under a monthly package or CFO/controller services may be priced as a special project.

Getting Started

If you are ready to discuss outsourcing some or all your organization’s finance functions, here are some first steps:

    • Find a provider who is experienced in your space. If your organization is a small or medium-sized business, there are outsourced finance providers that specialize in businesses of your size. The same applies to nonprofit organizations.
    • Consider which finance functions you want to outsource first. Some organizations start by outsourcing accounts payable and accounts receivable, then expand to more functions in response to internal staffing challenges or realignment of responsibilities.

Before hiring an outsourced provider, talk with them about how they work with clients like your organization. Some good questions to ask are:

    • How will they work with your internal finance staff or with you directly?
    • How often will they be in communication?
    • What are their procedures for dealing with problems that may arise?
    • What are their billing practices, and how will they handle additional billings that may arise from unexpected issues?
    • What will monthly reports look like?
    • What capability do they have to help with occasional projects, such as equity investment, debt financing, or a merger?

Your time is limited and is better spent doing what you do best – running your business with the most complete financial information and analysis possible. An outsourced accounting partner who can provide you with on-demand financial management services that are customized to your needs will allow you to stay focused on growing your business.

Windham Brannon is committed to providing the right finance solutions for your company. Contact Carlye Dooley and Rebecca Smith to learn more about WB’s Client Accounting Services.

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