Each business will have its own financial reporting process depending on its type, size, and the kind of transactions it handles month to month. There are also several industry considerations to take into account when thinking about the right accounting system for any given organisation, from the type of typical relationships with its client/customer base to the status and turnover of employees.
In-house bookkeepers, accountants or controllers are one way of making sure that these processes are organised and efficient, giving business leaders reassurance that their team is handling this side of things for them. However, finding the right bookkeeper for the right price can be incredibly hard.
As well as hiring someone with the right training, experience and skill set, you’ll need to ensure they fit in with your company structure and culture. Also, to get your money’s worth from having a relatively senior level member of staff, you’ll probably require them to get involved with other aspects of your company, such as HR responsibilities, and this can sometimes take away from their core focus on accounting duties.
Meanwhile, many organisations look to external bookkeeping and accounting service providers to handle the collection, organisation and handling of various financial processes, including paying bills, sending invites, and handling payroll services for small business in the UK.
The hardest decision for company owners, therefore, is deciding whether an in-house bookkeeper or accountant is a smarter option than actually relying on third-party accountants who handle several key components of the company’s financial process for them.
We discuss the option and leave you with some important considerations if you’re looking for a bookkeeper or external provider to outsource your accounting processes to.
Sending out all your accounting work to another company might seem scary. You might have expectations for internal checks and controls that you won’t be able to oversee in as much detail as you’re used to. This is one of the major reasons businesses choose to have an in-house bookkeeper, as it allows owners to have a more active part in ensuring financial details are completely accurate.
Having said this, companies that only have one or two accountants face a higher risk of internal fraud or theft. If the person paying the bills is the same one reconciling the bank account there isn’t a sensible separation of duties. Individuals may be able to steal from you and cover their tracks.
As such, outsourcing helps reduce the risk of fraud because there are appropriate separation of duties and more stringent steps taken by most accounting firms when providing financial statements for businesses. The trick is to find an accounting agency that offers 100% transparency about their processes.
Is quality more guaranteed with an in-house bookkeeper or an external agency? Some believe the former option is the best way to guarantee accuracy and diligence, however, this is an opinion usually held by owners who are willing to be involved in certain checks and balances during the accounting process themselves.
For owners who have less time, outsourcing can be the better way to ensure quality. This can help to ensure deadlines are always met and that there is always capacity to handle various transactions and reports, no matter what’s going on in people’s lives.
Simply in terms of expertise and experience alone, outsourced bookkeeping and accounting services can offer more collective value as employees of these companies can be experienced in their field and up-to-date with continual training in accounting and technology.
Is it All or Nothing?
Outsourcing your bookkeeping and accounting might seem like a definitive option, but this is far from the truth. If you want to handle certain aspects in-house and leave the rest to an accounting bureau, that’s completely possible.
When you decide to outsource, you can pick and choose exactly what you need for your business. This means that if you already have a bookkeeper in-house, you wouldn’t necessarily need to let them go. This can be useful if their responsibilities are getting too much for one person to handle while the company grows.
Instead of sending everything to an external accounting firm, you can have your employee retain the core aspects of the job and send out the rest. This might also help you to keep the cost of hiring a more senior accountant down as you can manage with a junior to mid-level bookkeeper instead.
Finding a System that Works for Your Business
In-house and outsourced services offer different workflows when managing the bookkeeping and accounting for your company. If you’re looking for payroll services for small businesses in the UK or ways to unburden your team from time-consuming financial reporting, get in touch with us for information about how Paycheck can help.