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The Ultimate Guide to Outsourcing Bookkeeping [2020]

The Ultimate Guide to Outsourcing Bookkeeping [2020]

Contents

The Ultimate Guide to Outsourcing Bookkeeping [2020]

In today’s unsteady economic environment, your small business is likely already stretched thin with shutdown-related staffing cuts, loss in revenue, and uncertainty about the future. But getting through the tough times often means building a long term foundation that can withstand bumps along the way. Fortunately, many businesses have found that when outsourcing bookkeeping, they can afford the experts they need to build the cornerstone of financial stability that is necessary for long term survival.
While your team continues to do the hard work of maintaining and building up a business during difficult times, outsourced accounting services can save you precious time and money while making reporting and impactful financial planning a breeze.
Read on to understand everything you need to know about outsourced accounting services and how they can help businesses get back to doing what they do best while leaving their financial worries behind.

How Does Outsourced Bookkeeping Work?

Outsourced bookkeeping means that instead of having an in-house bookkeeper or CFO, or trying to manage it all yourself, you have highly skilled financial experts dedicated to your exact needs. Additionally, instead of just having one bookkeeper to handle all your financial accounts, you have access to an entire team. You’ll gain one staff accountant, director or CFO as a liaison to your team. But on the back end, you have a full service team that handles everything from day-to-day expenses to monthly reporting and financial data management.
Once you’ve been assigned a professional, your outsourced accounting services begin immediately to work for you. Here’s what happens:
  1. The team sets up your back office operations, taking care of all data imports and creating a streamlined system of bookkeeping that will save you time, money and headaches going forward.
  2. Your specific business needs are catered to as a plan is set in place to expertly handle your monthly reporting and provide the best in data analytics.
  3. By using the monthly numbers and crunching the data, the experts from your outsourced bookkeeping services are able to discover shortcomings to improve upon, as well as opportunities to explore.

Does Outsourcing Your Books Make Sense for Your Business?

You might wonder if the time is right for your business to begin outsourcing your bookkeeping. Ask yourself the following questions to help determine if outsourcing your books makes sense for you:
  • Do you worry that your financial reporting may have some inaccuracies, but you’re just not sure and too busy to double check?
  • Are you considering getting financing for your business and wonder if your bookkeeping will be sufficient to paint your business in a positive light?
  • Does it feel like your taxes are becoming too complex to easily tackle so that you dread when tax season rolls around?
  • Is time spent on bookkeeping keeping you from building your business?
  • Are you struggling to meet reporting deadlines for compliance?
If you answered “Yes” to one or more of these questions, outsourced accounting services can make sure you are fully confident about your reporting, compliance, financial data, and the next tax season. You’ll have access to everything from standard financial reports, to tax consulting and business financial planning. With this in place, you can focus on your business while your books are run expertly and in tune with your specific enterprise.

In-house Bookkeeping vs. Outsourced Virtual Bookkeeping Cost

One of the main advantages of outsourced bookkeeping is the low cost in comparison to in-house bookkeepers. Whatever the size of your business, outsourcing the accounting means you can hire exactly the services you need and still save on the yearly cost of bookkeeping. Outsourced providers cater to each business and can provide a pricing plan that fits exactly what your business needs each year. This can also be easily scaled as you grow your business.

Outsourced Bookkeeping vs. In-House Bookkeepers How Much Does it Cost?

Type of Bookkeeping
Monthly Cost
Annual Cost
In-House Full-time Bookkeeper
$4500 – $6500
$55,000 – $75,000
In-House Part-time Bookkeeper
$2250 – $3250
$27,000 – $37,500
Outsourced Virtual Bookkeepers (flexible/scalable)
$500 – $2500
$6000 – $30,000

What You Should Look For When Outsourcing Your Bookkeeping

Now that you have the full understanding of what outsourced bookkeeping services can do for your business, let’s take a look at some of the main things to watch for when selecting your provider.
One of the first considerations for outsourced bookkeeping is the physical location of the outsourced bookkeeping company. Will your team be available during the same time zone? The second thing that comes to mind is fee structure; is it open and transparent? For example, is there a fixed fee package for the outsourced accounting services you are researching?
There are many other considerations as well when making your choice. So let’s go over each of them:

Accountability & Fee Structure

When discussing a plan with an outsourced bookkeeping firm, it’s important to know exactly what you are paying for and how that value is established. The company should be able to show you exactly how much time they will be spending, and what work will be done. It’s beneficial to nail down a fee structure that meets your needs and provides no surprises that could affect your cash flow and budgeting needs. Having a regular payment that is also open for updating as your business scales is essential.

Expertise

When outsourcing bookkeeping, always check to make sure the company’s staff is highly qualified and registered. Also look for reviews about their service (if you can’t find any online, ask them for testimonials). As important as your business is, you want to make sure you have access to bookkeepers and CFO’s with true expertise in their industry.

Confidentiality and Security

Your business data is an extremely valuable resource to your business, your customers, and unfortunately, some devious hackers. Accordingly, before selecting a provider for outsourcing bookkeeping, you want to be confident that the company has full confidentiality policies in place, since they will be handling your precious financial data.
Data security is another top concern; how does the company handle a security issue or data breach? What are their supporting security protocols?

What Bookkeeping Services Does Your Company Need?

Outsourcing bookkeeping doesn’t just mean having an online bookkeeper taking care of your books. They often involve a full team of experts that can assist you beyond basic bookkeeping:
  • Preparing and handling business and payroll taxes
  • Managing end of month reports
  • Administering the payroll
  • Analyzing data insights and tracking performance metrics
  • Setting up a cutting edge company dashboard for bookkeeping that will save you money while giving you more time to build your business.

Competitive Cost Range

You’ll want to know when outsourcing bookkeeping that the company in question has a range of services that fits your needs, along with a competitive cost range. That way you’ll have a choice and the ability to create a plan that fits with your budget and maximizes your company’s financial status. For some businesses, a bookkeeper can handle all their needs, while for others, a team of bookkeepers and a CFO may be necessary to successfully manage the additional complexity.

6 Reasons To Hire Outsourced Bookkeeping Service

We’ve covered a lot of ground on what it means for your business to be outsourcing bookkeeping. You’ve learned how outsourced bookkeeping services can benefit each individual business in many ways and what they can do for your bottom line. Now it’s time so summarize in a quick list the six big reasons to acquire outsourced virtual accounting services:

#1 - Lowering the cost

Having a full time CFO or inhouse bookkeeper means a full-time employee, whether or not you need them at full capacity. By outsourcing bookkeeping, you can lower the cost of such services by paying only for an agreed upon plan that suits your needs. You’ll save on the overhead costs of having an employee, while accessing a full team instead of just one professional.

#2 - Guidance in Managing Finances

When you are outsourcing bookkeeping, you gain access to a team of professionals that help you analyze your financial statements and find new ways to economize business spending and maximize revenue. Additionally, the analytics and financial management aspects can save your business money in the long run by setting you up for success with financial advice catered to your business specifically.

#3 - Keeping it private and confidential

Even with an inhouse CFO, that does not guarantee that data security is covered. But by outsourcing bookkeeping, you are able to work with a team of experts that make data management and safety a priority. Because their work is 100% remote, data security is a priority that they are highly equipped to handle with cutting edge accounting software.

#4 - Focus On Growing Your Business

Growing your business is what you do best. That’s why outsourcing bookkeeping is so beneficial – it lets you be you while a team of dedicated financial experts handles the bookkeeping, reporting and data security. With that taken care of, you can put all of your focus back into your business.

#5 - Control Your Money

Outsourcing bookkeeping enables you to control your money in a much more efficient, cost saving and secure fashion. With a financial dashboard created to give optimal transparency, seamless monthly reporting documents, accurate financial statements, and important insights can be available to your entire team.

#6 - Be Free Of Worries With Professional Service

Handling tax preparation activities such as reporting and keeping accurate financial records for raising capital, and securing your business data are all complex tasks that can be handled easily by a professional team when outsourcing bookkeeping. Having access to professional services not only takes the pressure off of you as a business owner, it also helps to eliminate mistakes while maximizing profits. .

Outsource Your Bookkeeping to Grow Your Business

Outsourced accounting services can provide the financial tools and expertise to take your business to the next level. With tax season no longer a burden, and reporting and data management a breeze, outsourced bookkeeping gives you the peace of mind to continue doing what you do best, without the added hassle and expense of maintaining inhouse financial staff. Now you can grow and your outsourced bookkeeping services will grow along with you, making your job more rewarding and less stressful. In today’s business atmosphere, having a trusted partner for outsourced accounting can mean survival and long-term success.
Talk to an expert at Punch Financial today and find out exactly how your business can step up to a new level of efficiency and growth. We’ll help take you there.

About the Author

Frank Mastronuzzi, CFO
Frank Mastronuzzi, CFO

Frank has 15+ years of experience managing financial and operational functions of various fast growing companies and is the founder of Punch Financial.

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