In-House Accounting vs. Outsourcing
Accounting In-House Vs. Outsourced
Small to medium sized businesses across the Hamilton area have been tightening their financial belts for the last couple of years; curbing expenditures, adding another year or two between renewing office computers, or even trying to take on more roles inside the business. As a business owner you might be facing one of these three different situations regarding your accounting:
1. You have, or are considering to hire, a full time accountant in your office.
2. You or an employee are doing, or are planning to do, your own accounting work in-house using simple software.
3. You have, or are thinking of finding, an accountant that takes care of your books.
Before we analyze how outsourcing your accounting can benefit, it’s important to understand that every business scenario is different; there’s no one-size fits all answer to whether or not you should outsource your accounting work. Therefore we would strongly suggest that you weigh your options carefully, and seek a professional opinion on your specific situation.
Situation 1 – You have, or are considering to hire, a full time accountant in your office.
Having an accountant on staff gives you very quick answers, as well as more day-to-day control of an employee. However these minor benefits of an in-house accountant are far outweighed by the negatives. The biggest disadvantage in having a full time accountant in your office goes far beyond that of a competitive salary; you also need to consider the added costs of recruitment, extra office space, a computer, other office equipment and supplies, software licenses, employer contributions to CPP and other government payments, and even things such as benefit plan costs. Although this is the most major, we’ve outlined some of the pros and cons of having an in-house accountant.
Quickest Answers Possible
More Day-to-Day Control of the Employee
Experience is Limited to One Business
No Team to Assist Solving Accounting Issues
Inability to Increase ‘Production’ Consistently With ‘Demand’
Not Exposed to Many Different Problems
Situation 2 – You or an employee are doing, or are planning to do, your own accounting work in-house using simple software.
You may be thinking “I’ve got this far building my business and know all the ins and outs. As long as I get the right accounting software I should be okay for now!” however this is a very dangerous statement to be making. You’re right, you’ve gotten this far building your business, but wouldn’t it be a shame to lose it now? Although you or your well intentioned employee may have taken a few accounting courses before, you don’t want gamble your entire business to save just a few bucks. An employee turning ‘bookkeeper’ for a growing business is dangerous for several reasons, the most dangerous being that the employee will lack the accounting knowledge to help properly advise a growing or struggling business. Professional accountants are able to provide an unparalleled level of advice, as they are able to see much further into your business than you may think.
Most Cost Effective
Quickest to Start
Lack of Accounting Experience
Inability to Provide Valuable Business Advice
Increased Risk of Costly Errors
Situation 3 – You have, or are thinking of finding, an accountant that takes care of your books.
Although in most cases outsourcing your accounting saves you money in the long term, professional services do have costs. It’s important to remember that every accounting firm has different rates, pricing policies, and client experiences. Because of this, we strongly suggest that you speak with the firms, and not just browse their websites, as you need to be aware of how your businesses are going to interact. Does the accountant treat you like another paycheque, or do they feel like part of the team that genuinely cares about your businesses success? The pros and cons list for this situation aren’t like the other two, as each firm will differ from one to the next; some even costing as much as having an in-house accountant! What’s important is what you’re being provided by your accountant.
Do You Have:
Your Questions Answered Fast?
A Fixed Cost Package?
A Service Quality Commitment?
A Professional Accounting Team, and not just one accountant?
A Full Service Accounting Solution?
Professional Business Advice?
Professional Representation in Case of an Audit?
These are just some of the things that Hamilton Accounting Solutions provides. To learn more about how you can save money and still have high quality accounting service, get a free consultation with us to see for yourself how we can take care of you, and save you money.