5 Reasons to Outsource Bookkeeping
In this article, we cover five compelling reasons to try outsourced bookkeeping services. If you have ever asked yourself these questions, now’s your chance to get some answers…
- Would you like to know if outsourced bookkeeping services will save your business or organization money? Psst: It will!
- Has your bookkeeper or controller just given notice?
- Do you need expert advice on your business’s financials?
- Is it time to adopt modern, cloud-based accounting software?
We’ll share our findings from years of providing outsourced bookkeeping and accounting services to high-growth businesses and nonprofits in the Greater Toronto Area and beyond.
We’ll cover the main benefits of outsourcing your bookkeeping, plus we’ll provide a few pointers on when to make the move.
So… if you’re looking for truth and transparency, this guide is for you. Read on for a deep dive into our findings.
1. Save money with outsourced bookkeeping
When you outsource your bookkeeping, you greatly benefit from something called “fractional” value. Fractional value means you get “some time” from a bookkeeper. If you work with a firm like Stern Cohen, you can also get “some time” from an accountant, and “some time” from a virtual CFO. The beautiful part is that you don’t have to employ each position or role full time – you just pay for as much as you need, when you need it. An online bookkeeping service is more efficient and less costly than hiring in house. With Stern Cohen’s outsourced bookkeeping solution (Stern Cohen FIT) you get a Finance team of professional bookkeepers for less than the price of one staff bookkeeper!
Did you know…
You can save money when your bookkeeper and accountant come from the same firm. Many business owners are familiar with the following year-end scenario when it’s time for their accounting firm to complete the annual financial statements. Quite commonly, if your bookkeeper is not under the guidance of a CPA, and they’ve made errors during the year, your accounting firm will charge you to correct those bookkeeping errors! These fees for reconciliations (adjustments and corrections in accounting lingo) can add up. In addition, your bookkeeper may have missed CRA deadlines or tax planning opportunities.
2. Work with skilled bookkeepers (ideally with CPA oversight)
The bookkeeping profession is unregulated. No training or designation is required to call oneself a bookkeeper. This is in stark contrast to the rigorous education and experience required to be a designated Chartered Professional Accountant (CPA).
So when Stern Cohen decided to put together a specialized team to provide accurate, timely and efficient bookkeeping services, we made sure our bookkeepers have:
- education and training
- guidance
- CPA oversight
Our bookkeepers have certifications and degrees in finance and accounting programs from local colleges and universities. Having a skilled bookkeeper who works on a team with CPA’s and Tax Specialists ensures that your books and processes comply with Ontario and Canadian financial regulations. This means you won’t have to worry about penalties and interest from the CRA for non compliance.
3. Enjoy continuity and scalability when outsourcing bookkeeping
You might be reading this article because your bookkeeper, controller or CFO has just given notice. Suddenly, you’re in a panic because good bookkeepers, controllers and CFOs are in high demand in the Greater Toronto Area. In fact, in 2024 there is a severe shortage of skilled finance personnel in Canada and the US. So what will you do?
The best (and easiest) solution is to outsource your bookkeeping tasks and finance needs to a service provider you can work with long-term.
Continuity for your business means you have coverage for your essential internal accounting tasks and financial processes when key players go on vacation, take long term leave or move into a new role. At Stern Cohen, your bookkeeping is assigned to two team members. Why two? Well, the lead will be your primary contact, but when your lead goes on vacation, you will always have an alternate familiar with your account.
You’ll also receive support from a Senior Manager AND a Stern Cohen Partner who is an experienced CPA.
Business owners know their needs can change quickly. An outsourced bookkeeper can easily scale with your business as it grows.
4. Don’t do your own bookkeeping. Benefit from professional advisory and tax planning expertise in addition to bookkeeping services.
Did you know? Advisory and tax planning work best when bookkeeping is done by the same service provider.
Ever try to find high-value tax and advisory services? You probably didn’t get very far because these specialists can’t assist unless they can vouch for the quality of your books
That’s right. In order to take advantage of expert tax advice to help you navigate complex regulations and optimize financial outcomes, you need accurate bookkeeping services and financial reporting.
Advisory services facilitate better planning, enabling informed decisions about growth and investment. A CPA or financial analyst can offer advice to enhance your profitability and to make better choices, but they also need accurate data to base their advisory on.
At Stern Cohen, your partner will become a trusted advisor who is available when you need them. Monthly or quarterly advisory can include coverage of the following topics:
- Tax effective structures, long term planning
- Budgeting and cash flow forecasting
- Financial reporting that includes gross margin analysis by product line, liquidity ratios
- Transaction advisory (liquidity events, contracts, etc.)
- Assistance with securing financing
- Board meeting attendance
5. Upgrade to a modern cloud platform
You won’t be surprised to hear there’s been a technology revolution in the bookkeeping and accounting industry. In the past, your freelance bookkeeper visited your office in-person because their work was largely paper-based. In addition, the software used was run on a local computer only accessible from the office site. With the advent of cloud software, this workflow has changed forever!
Say goodbye to collecting, sorting, and storing receipts. Say hello to having your books remotely reconciled in real time. Never again will you be limited to sharing your books with your accountant at the end of the year (too late for optimal tax planning). Instead, you’ll be able to give your accountant remote access to your online account to discuss tax planning opportunities throughout the year, not just at year-end when there’s precious little time (or not enough time) for proper tax planning.
At Stern Cohen, we use an industry-leading technology stack that includes QuickBooks Online and other third-party apps like Dext, Wagepoint and Plooto to protect your data with bank level encryption technology.
When you use a cloud accounting system, your accounting data is stored on remote servers offsite, rather than on a local hard drive. This has obvious disaster recovery benefits for any business or organization. You’ll even save space when you get rid of the filing cabinets and bankers’ boxes of receipts that might get lost, damaged and will fade over time. If you’re ever audited by the CRA, or for your regular audit, financial data and necessary paperwork will be in digital format. It will be searchable and accessible in the cloud. You might want to check out our article Keep Your Receipts for the CRA as we’re seeing an uptick in CRA requests for supporting documentation in line with tax laws.
New software applications are automating endless repetitive tasks and, as a result, reducing human error. If you’re still using desktop software, it’s time to transition to our industry-leading accounting technology platform.
Finally, are you operating your business outside of Toronto? Rest assured, geography is no longer a concern. Thanks to our cloud accounting platform, you can still work with us, eliminate travel time and maximize communication and advisory time with a virtual bookkeeping service – it’s a win win!
When to outsource your bookkeeping
Here are five flashing indicator lights that it’s time to make the move to an outsourced bookkeeping service:
- Your business is growing and more time is necessary to keep the books in order to understand cash flow
- Your bookkeeper or accountant can’t keep up with an increasing workload and as a business owner you are stressed
- Your in house bookkeeper is resistant to adopting modern, efficient technologies
- You are seeking financing OR partnering with other organizations and they are requesting more frequent or more sophisticated reporting that your existing resources can’t provide
- Your small business requires a wider specialist team for services like bookkeeping, payroll, monthly reporting, advice, financial statements, tax compliance and planning
Let the pros handle your bookkeeping
A few members of our specialized outsourced bookkeeping, accounting and tax team: Stern Cohen FIT. Check out our Q&A section below for answers to common questions about our outsourced bookkeeping and accounting services.
