A New Reality of Your Accounting Function
By: Dean Dorton | June 10, 2020
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Let's talk outsourced accounting. You have concerns and we understand that. Our new reality could change the accounting process as we know it.
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Since there is no one else in this room to have an opinion, I get to choose what I want to talk about. I want to dive into a topic that is near and dear to my heart, which is accounting delivery models. Historically, accounting has been done internally, within organizations. The owner of a business may start off by creating invoices and paying bills from their kitchen table or the corner of the warehouse they operate out of. After about 2 weeks of this, the business owner realizes they didn’t start their own business so they can become an accountant so their goal of growing the business to get rich becomes grow the business enough to justify paying someone to do the accounting. Regardless of the situation, most often someone within the organization was doing the day to day accounting. I call this the DIY (Do It Yourself) accounting delivery model.
Now, add cloud-based technology allowing multiple users to access an accounting system from any location. Combine cloud-based technology with automation applications that reduce the number of key strokes needed to input data and drive workflow. What we have today is an environment in which outsourcing the accounting functions becomes a viable delivery method, one that may enhance the value of the accounting function.
Before you say “I’m out, outsourcing is not for my group, let’s see what they are talking about on True Crime Obsessed (great podcast by the way)” let me ask you a few questions:
- Does turnover in your accounting department cause delays in your basic accounting function?
- Is your accounting software out of date or prone to crash?
- Have you outgrown your accounting software but don’t think you can afford a more robust system?
- Do you have good people in your accounting team, but they could be adding so much valuable to the organization if you could re-deploy them to something more meaningful than reconciling the bank accounts?
- Is your accounting process full of manual steps?
- Does the monthly closing process leave your team in tears?
- Are exporting data from your accounting system into excel in order to manipulate the data for the reports you need?
- Are you tracking non-financial data outside of your accounting system and building manual reports that combine the financial and non-financial data?
- Do you hate hiring accountants?
- Do you struggle to use financial statements to tell your organization’s story?
- Are you worried about fraud or theft and wish you had someone else to looking under the hood?
If you answered yes to any of these questions then outsourcing might be worth exploring.
Maybe you are thinking that your team could use some help, but you don’t like the idea of outsourcing the entire function. Maybe you don’t want to risk losing a valuable employee by implementing a big change or maybe you just need someone to offer some guidance at a controller level. Outsourcing models can be designed to facilitate this. This is sometimes called co-sourcing. Examples of co-sourcing might include:
- Using outsourced resources to enter invoices and reconciling cash to support the controller you have on staff
- Perhaps you use outsourced resources to supervise your clerical staff and to control the month end closing process for you
- Maybe you have strong clerical people and a steady controller, but need someone to think big picture about the accounting and finance function. Maybe you partner with an outsourced CFO
The beauty of an outsourced deliver model is that it can be highly customizable.
Whether you know you want to outsource or would just like to discuss what options could look like for your organization (without any obligation), contact Justin Hubbard or Krista Nash to learn more.
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