As seen in Business First: Key considerations when outsourcing your accounting (and worries)
February 23, 2024 | Authored by Matthew R. Huefner
February 23, 2024 – Matthew Huefner recently authored a guest column in Business First of Buffalo.
Key considerations when outsourcing your accounting (and worries)
Over the past several years, businesses across all industries have experienced a drastic shift in the availability of qualified talent, especially in the areas of accounting and finance. While internal demands for information from key stakeholders continue to grow in this age of digital transformation, finance teams are often strained beyond their means to provide that information in a timely and meaningful way.
A 2023 Wall Street Journal article indicated this trend is expected to continue, as accounting professionals leave the field and fewer people are pursuing accounting degree programs. Businesses that experience the loss of a qualified accounting professional may be suddenly left in a pinch with intense competition for limited replacement options. One way that forward-thinking businesses can address this issue quickly is via outsourcing.
The first step is knowing your business’ requirements
Each business may have different needs (and timeframes) when it comes to filling staffing gaps. For example, a business that suddenly finds themselves without an accounts payable clerk may only require a few hours of outsourced help, to ensure their vendors are being paid in the short term. On the other hand, the departure of a CFO will likely require a more extensive search for a replacement and may require several days per week from an outsourced professional in a fractional role.
Temporary may become permanent
Due to external factors in the marketplace, what began as a temporary “fill-in” role may expand into a permanent solution. There are several reasons why such an outsourcing arrangement may be attractive to businesses:
- Payroll costs are reduced, not just in salary and benefits, but in the investment in training new employees.
- Bench strength is exponentially increased. An outsourcing arrangement from a professional service firm provides access to a wealth and variety of industry and accounting expertise, that would be impossible for a single employee to replicate.
- Less valuable tasks are reduced or eliminated. Rather than chasing down accounting entry errors, or making sure your bills are paid on time, businesses who outsource can focus their time on bigger picture issues. This allows them to work “on” their business rather than “in” their business.
Leveraging technology
Beyond assisting with people, businesses may also decide to shift the entire operation of their accounting system to a dedicated team of outsourced professionals. This arrangement often provides access to a level of technology and economies of scale that an individual business cannot reproduce. Some of these areas include:
- Expense approvals – While entry of bills is handled by the outsourced firm, a business’ internal approvals can all be done electronically via email.
- Bill pay – Rather than cutting checks, and outsourced firm can handle electronic payments of approved expenditures.
- Increased data security – Outsourcing often utilizes cloud-based solutions, which removes a business’ risk of having data on an internal server.
- Data visualization – Combining the power of the cloud with the resources of an outsourced accounting team can allow for the development of powerful reports and dashboards, providing key stakeholders needed visibility into their business in a more real-time manner.
In summary
As finance teams deal with more and more constraints on their time and resources, businesses will more frequently need to look outside their four walls to continue to operate efficiently and effectively. The continued growth of the outsourcing industry highlights the effectiveness of deploying such a strategy, to ensure both short- and long-term success of the business.
For more information, contact Matthew Huefner at mhuefner@dopkins.com.
To read the article on the Business First of Buffalo website, click here.
The Client Accounting & Advisory Solution (CAAS) of Dopkins & Company, LLP is centered on helping our clients transform the accounting and finance function of their businesses to more effectively confront challenges and seize opportunities that drive business results and create value. To learn more, visit Dopkins at www.dopkins.com/services/caas.
About the Author
Matthew R. Huefner
Matt is responsible for providing implementation and support services to Enterprise Resource Planning (ERP) and accounting system user clients, including the implementation and on-going support of the Sage 300 (formerly ACCPAC) and the Sage Intacct accounting software packages.
