October 12, 2021 - Outsourcing your accounting needs, such as monthly bookkeeping, budgeting and assisting with year-end financial reports, offers distinct advantages for small and medium-sized businesses, compared to handling this work in-house. It allows you and your staff to focus attention on other work and it provides you with the reliable, timely, accurate, and complete financial information you need to manage your business better.

Lifting the burden is especially important if your CFO or Controller is hands-on with transactional, day-to-day accounting. This work is so time-consuming it’s easy to become mired in the routines of handling short-term details and so focused on looking at the past that you can’t look toward the future. That’s a problem, summed up nicely by the late writer and thinker Edward de Bono.

“You can analyze the past but you have to design the future.”

If you don’t deliberately plan for the future, your business will wander aimlessly instead of growing to fulfill your vision. And that’s where strategic accounting services come in.

What is “strategic” accounting?

Smaller companies often don’t have a designated financial “strategic thinker” within their organizational structure – a role that usually falls to the CFO or Controller. If no one is looking into the company’s future financially, the company continues to react vs. plan. Strategic accounting services connect you with people who can help fill that void so you can effectively plan for the future, rather than merely analyzing the past.

What many small and mid-size businesses don’t realize is that you can utilize outsourced accounting services for more than helping with monthly bookkeeping. Outsourced accounting services can also include project-based work such as building a budget or forecast, capital funding review and funding analysis, year-end planning for taxes or audits, payroll compliance, process improvements, system analysis, and more. And these projects you can do whether or not you choose to outsource your monthly bookkeeping. If you are not taking full advantage of strategic accounting services, you’re missing out on opportunities to get top-level professional advice and insight from specialists who can really make a difference in your company’s future. 

These CPA services are typically project-based, so you can tap into the expertise you need, when you need it.

How your business benefits from outsourced accounting

1.       You get a strategic advisor

You need someone who can take a step back and look into the future based on past performance and company goals. If that person doesn’t exist in-house, then it’s the perfect opportunity to bring in outside expertise. Strategic accounting services can help boost “big picture” business management (budgeting, forecasting, etc.) and also supply additional specialized services as needed to support that. The strategic accounting consultants bring their plethora of experiences seeing multiple companies and what things have worked or not worked.  

2.       You get a partner

A lot of companies hire someone from outside to do their taxes, and maybe an audit. But treating these as one time vendor services can be short-sighted. Your CPA firm should serve as an ongoing partner, sitting at the table with you as you review and plan. You should meet with your CPA at least quarterly, and your CFO/Controller should work collectively with the hired CPA firm on business planning.

With strategic outsourced accounting services from a CPA firm, they are able to work directly with the tax team as a strategic group wholistically helping all aspects of your company from a financial perspective. By combining your strategic partners, you can get multiple perspectives regarding tax implications or other future financial opportunities for which your business can take advantage. 

Let’s suppose an audit is required. With outsourced accounting, closing the books and reporting is handled every month, along with year-end adjustments and reports. So there are no surprises when it’s time for the audit.

Strategic accounting services can also step in on a project basis to help in-house staff prepare for an audit, something companies often don’t have the time or personnel to do on their own. In this case, the outsourced accountant(s) can come in a couple of months early to get the books cleaned up and ready for review.

3.       You can plan for the future 

Creating an annual budget or multi-year forecast are critical pillars of business success, yet many smaller businesses struggle in both of these areas. Strategic accounting services help put you on the right financial management path. Consultants typically have templates or prior ideas from working with several companies on how best to develop a budget or forecast. They can guide you through the entire process and create an ongoing budget plan to be followed each year.  

4.       You get deeper insight

Every aspect of business operations and financials affects business outcomes. Comprehensive accounting services ensure you have both financial data and advice to pinpoint and sidestep potential problems and also identify and exploit opportunities quickly. This includes helping you determine potential growth areas or, conversely, determine whether it is time to sell or downsize the business. In this case, the M&A team could step in to provide invaluable assistance.

5.       You get specific advice

Strategic projects can focus on key finance-related areas. Payroll experts can help streamline processes and ensure you’re properly categorizing W2 vs. 1099 employees, etc. Tax experts can help vet your business plan and advise on business structure, estimated taxes, or regulations and compliance issues. Should you lease or purchase a particular piece of equipment or property? Strategic CPA services can help you make a future-forward decision.

Strong financials drive business success. But as a small to medium-size business, you cannot do everything yourself. Outsourced strategic accounting services go beyond bookkeeping to connect you with the expertise and resources you need to look into the future and proactively plot your course.