If you are a start-up business owner who has invested a significant amount of monetary investment, energy and time, you know how time taking small business accounting can be. In today’s changing business landscape, you want to focus on developing strategic initiatives for your business that can drive it forward rather than spending your valuable time on bookkeeping and financial reporting of your small business.
The alternative to this is process outsourcing such as accounting processes, marketing processes and IT processes. This can help you stay focused on driving your business forward while you leave the non-operational processes to industry experts. By outsourcing your accounting functions and financial reporting to these industry experts, you can gain access to detailed financial reports for your small business that can help you make growth-driven decisions. Moreover, the industry knowledge that these experts bring to the table are second to none.
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Why do Startups Outsource CPA Services?
Businesses opt to outsource CPA services for a variety of reasons which may involve cost savings, access to high quality resources, and flexible contracts. Outsourcing can allow businesses to gain access to all these things without requiring a full-time commitment from a resource. This can help businesses save hiring and training costs, and utilities costs. CPA outsourcing firms hire professionals who are equipped with in-depth accounting and financial knowledge. Start-ups, due to their limited resources, may struggle to gain access to these resources when hiring for a full-time resource. By utilizing outsourcing however, start-ups can gain access to the same level of skilled resources as the top tier companies do without investing a substantial amount of money.
Outsourcing CPA services can also help small businesses improve efficiency and mitigate the risk of errors and compliance issues. CPA firms usually use advanced accounting software and tools to streamline accounting processes and automate repetitive tasks, ensuring accuracy and detail in your financial data. This efficiency not only saves time but also minimizes the likelihood of costly mistakes that could hinder the startup’s progress. Moreover, they also stay updated with the latest industry trends to help you optimize your accounting processes.
In addition to cost savings and efficiency, outsourcing CPA services allows small business owners to focus on their core business areas and plan strategic initiatives for their venture. They can also free up their existing and valuable resources and reinvest them into core areas of their business, ultimately gaining access to valuable insight. The focus on core business initiatives can be a road to long-term success for the business in the industry. By outsourcing your CPA services, you can have more time building brand awareness, acquiring new customers and driving business growth.
After Covid-19, the outsourcing industry has met with a vertical shift. More and more companies are leveraging outsourced accounting to streamline their business operations and focus on core business areas. Moreover, many companies tend to extend their contracts with their outsourcing accounting providers, gaining high-quality accounting services in return for a longer period of time.
1. Budgeting, Forecasting, and Financial Advice:
To grow positively, a small business requires careful budgeting, financial and cash flow forecasting. This can help the business implement growth initiatives accordingly that fit in with the business plans. Industry expert accountants play an informative role in this arena as they can help business owners with valuable financial insight and advice.
2. Seeking Investment Capital:
Small businesses during their initial stages may need significant investment capital to grow and build a sustainable foothold in the industry. Accurate and detailed reconciliation of accounts payable and receivable books can allow small business owners to have a comprehensive understanding of their cash flows. In addition to this, detailed and complete financial statements are required when businesses are seeking loans or funds from investors.
3. Scaling with the company needs:
A small business in its initial stages may not require an intensive accounting attention. With time however, this need can scale up and the accounting department may require a number of industry professionals in order to function smoothly. Although you may be using accounting software for your business needs, the transition from accounting software to outsourced accounting can be an informative and educated move that you should make early to streamline your small business accounting.
4. Helping determine the company’s burn rate:
This refers to the rate at which a company spends its capital to finance overhead before generative positive cash flows from operations. Detailed and accurate financial records can help the small business analyze where it stands and what decisions should be made that can help it move forward.
5. Access to High-Quality Accounting Resources
Just like IT outsourcing, the accounting outsourcing industry has grown tremendously over the past few years. During the initial phases, the attractive factor in outsourced accounting was the reduced costs. However, with the saturation of industry professionals in the accounting outsourcing industry, quality of service has now become a significant factor due to which small business owners opt to outsource their accounting. In addition to this, outsourced accounting offers business owners an efficient, secure and convenient way to access their financial data in the form of cloud-based accounting.
Conclusion
If you are a small business owner looking to scale up their business, considering outsourcing your CPA services may be a fruitful initiative that can be pivotal in the long run. Remember, it is the core business areas that should be getting your energy, time and money and not the repetitive ones. Certainly, accounting is one of the most sensitive and decisive departments of a small business, so it is better to hire experts to handle it, especially when you are gaining access to those experts on highly reduced costs than their US counterparts.
Expertise Accelerated can provide you with the opportunity to gain access to a pool of global talent trained by our US-based management team. These offshore resources are highly skilled in their industries and stay updated with industry trends. If you need a helping hand with your accounting processes, schedule a consultation with us today and let us manage your accounting while you focus on core business areas.
