In this article we cover the key reasons to outsource your bookkeeping and accounting (and we explain WHY it matters).
- Has your bookkeeper or controller just given notice?
- Would you love an in-house CPA but can’t afford one?
- Is it time to adopt modern, cloud-based accounting software?
- Do you need timely and expert advice on your business’s financials?
- Would you like to know if outsourced accounting and bookkeeping will save your business or organization money? (Hint: It will!)
This article answers those questions and more.
We’ll share our findings from years of providing bookkeeping and accounting services to businesses and nonprofits in the Greater Toronto Area and beyond.
We’ll cover the main benefits to clients plus we’ll reveal a few pointers on when to change or outsource your bookkeeping.
So… if you’re looking for transparency and real-world experience, this guide is for you. Read on for a deep dive into our findings.
Top 5 Reasons to Outsource Bookkeeping and Controller Functions
1. Continuity and scalability
You might be reading this article because your bookkeeper, controller or CFO has just given notice. Suddenly, you’re in a panic because you realize that you have two weeks to find someone who can fill this key role. In two short weeks if you can’t find a suitable replacement you probably won’t be able to process payroll or issue your invoices on time. If a key member of your management team resigned at a time when you were considering a strategic move for your business, would you have the guidance and support to execute on the strategy? Unfortunately, good bookkeepers, controllers and CFOs are in high demand and short supply, especially in the Greater Toronto Area. The best (and the easiest) solution is to “outsource” your finance needs to a firm you can work with long-term. Let us take care of the hiring, so to speak.
If your business is rapidly growing, or if your business or organization is seasonal, you’ll understand that your needs can change quickly. Do you have the budget to hire an additional bookkeeper when the volume of transactions increases significantly? An outsourced solution can easily scale with your business as it grows or fluctuates seasonally.
Continuity for a business means that you have coverage for your essential internal 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 if your lead goes on vacation, you will always have an alternate familiar with your account. It’s a two for one deal!
Is your business growing fast? If you are experiencing rapid growth, we will support you with CPA advisory from a Senior Manager AND a Stern Cohen Partner to guide your business during expansion.
2. Go virtual! The Cloud gives you access to many more accounting and bookkeeping options
Businesses in small towns or isolated areas often find it challenging to get the accounting and advisory expertise they need from a local provider. In the past, they simply had to cope with fewer options. Fortunately, thanks to the right cloud accounting platform, location and distance are no longer a barrier to finding the best accountant and bookkeeper for your needs.
At Stern Cohen, we use QuickBooks Online (QBO). QBO has made it easy for us to work with clients in other provinces, cities and countries. We communicate with our long-distance clients over the phone, via email and Zoom. QBO has also given us unprecedented access to clients’ real-time data. That’s a game changer! Now, we can create, view, and share reports. We can monitor our clients’ key performance indicators in real-time to provide more accurate and proactive advice.
Working virtually, the business owner and our team members all minimize travel time and maximize communication and advisory time – it’s a win win!
As a result of the COVID-19 lockdowns, we’ve seen that this flexibility is absolutely critical. The pandemic support we provided resulted in claims of well over $200,000 for some of our clients.
So, if you are in the market for a new bookkeeping or accounting firm, don’t be defined by your geography!
3. Advisory & tax planning expertise when you need it (at a much lower cost than having one in-house)
If you decide to outsource your bookkeeping or accounting to a full-service accounting firm (like Stern Cohen), you will have ready access to advisory and tax planning from experienced finance professionals. This benefit is highly valued by business owners and not-for-profit organizations and charities. Chartered Professional Accountants can analyze your financial reporting and make recommendations for increased profitability and tax savings. 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:
- Cashflow management and projections
- Operating activities
- Profit margins and ratios
- Insurance needs
Payroll deductions and tax filings are required by law, but they often overwhelm business owners and nonprofit managers taking up too much of their precious time. Why not outsource your internal accounting, tax compliance and bookkeeping services to a trained specialist team who can efficiently take care of these duties? The upside: more time in your working day to spend on key projects and goals.
4. Save time and reap efficiencies with technology
You won’t be surprised to hear there’s been a tech revolution in the bookkeeping and accounting industry. In the past, your 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. With the advent of cloud software, this workflow has changed forever! Ta da!
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) to do proper tax planning.
At Stern Cohen, we use an industry-leading technology stack that provides efficiencies and “audit protection” benefits like secure, cloud storage. QuickBooks Online and other third-party apps like Dext will protect your data with bank level encryption technology.
All of your data will be safely backed up in the cloud. If your computer crashes or is unable to restore data, all you need is an internet browser or mobile phone to access your information. 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 integral to risk management for any business or organization. You’ll even save space when you get rid of those 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, necessary paperwork is easily searchable and accessible in the cloud. You might want to check out our article on the importance of keeping your supporting documentation for the CRA as we’re seeing an uptick in their requests for supporting documentation. Read that article here.
Finally, new apps are automating endless repetitive tasks and, as a result, reducing human error. If you’re still using desktop software, contact us to learn about our best of breed accounting technology platform.
5. Peace of mind (and cost savings) in an unregulated industry
Unbeknownst to most people, the bookkeeping industry is an unregulated one. No training or designation is required. This is in marked contrast to the rigorous education required for Chartered Professional Accountants.
So when Stern Cohen decided to put together an in-house team to provide accurate, timely and efficient bookkeeping services, we made sure our bookkeepers received training and ample guidance. Most have college certifications in Finance and accounting programs. In addition, and this is an important distinction, our bookkeepers have CPA oversight. Having a bookkeeper who works in tandem with a CPA helps ensure that your books and processes are compliant with Ontario and Canadian financial regulations.
Finally, did you know that you can definitely save money when your bookkeeper and accountant come from the same firm? It’s true. Since our bookkeepers have CPA oversight for the work they do, any errors are quickly detected. As a result, at year-end, there are fewer adjustments. This means no unexpected and additional time or fees.
Is the time right? When to switch your bookkeeping, payroll or accounting provider
Here are five flashing indicator lights that it’s time to make the move:
- Your business is growing and more back-end time is necessary to keep the books in order
- Your bookkeeper can’t keep up with an increasing workload
- Your 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 business requires a wider specialist team for services like bookkeeping, payroll, monthly reporting, advice and tax planning
We hope this article was helpful. Feel free to contact us when you’re ready to make the change!
Disclaimer: This article is intended to inform readers in general terms. Please consult your Stern Cohen advisor if you have any questions about your unique situation. While we have tried to ensure the accuracy of the information in this article, we accept no liability for errors or omissions.