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Outsourced Accounting: Top 5 Functions Of A Virtual Bookkeeping Team

outsourced bookkeepersThe Everest Group released its annual report on Finance and Accounting Outsourcing (FAO). (http://www.everestgrp.com/wp-content/uploads/2013/05/FAO-Annual-Report-Executive-Summary-May-2013.pdf) We explored some of the report’s findings in our post “3 Reasons Outsourced Accounting Is Not a Trend.”

In addition to reporting on the growth of the industry, the report looked at the top reasons businesses of every size choose outsourced accounting services. Let’s look at the top five reasons to hire a virtual accounting firm.

1. Manage Accounts Payable in a timely and accurate manner.

When your Accounts Payable isn’t on time, you could be wasting money in late fees, ruining your business credit, and even hurting your chances at getting favorable trade terms from your vendors and supply chain partners. Managing Accounts Payable also involves having accurate cash flow statements, so you’ll know you have the money in the account to pay your bills.

A full-charge bookkeeper can manage these processes efficiently, saving you time, money and alleviating substantial amounts of stress, too.

2. Manage Accounts Receivable so you get paid on time.

It’s difficult to keep AP up to date if your AR runs behind. When an in-house bookkeeper gets busy, invoicing should be the last thing to fall behind but, all too often, it does. This can put your business in a tight financial spot, especially if you and your executive team strives for a “just-in-time” business model.

3. General accounting/general ledger

According to the Everest Group report, a majority of businesses use outsourced accounting services for general accounting, including the general ledger. If you’re a fast-growing business that has recently transitioned to accrual basis accounting (link), it can be challenging for your current small business bookkeeper to keep up. Maintaining your general ledger accurately and in a timely manner has a number of benefits, including spotting and preventing fraud, and making tax filing easier.

4. End-to-End accounting solutions and business process integration

For some businesses, it’s appropriate to phase-in outsourced accounting and virtual bookkeeping solutions. They might hire a virtual accounting firm for weekly bookkeeping services, accounts payable, and accounts receivable. As they grow, they’ll turn to the same firm for help with payroll. After a time, as their business and accounting needs grow, they might shift to accrual basis accounting and require daily bookkeeping services.

But many midsize businesses with revenue over $2 million want the whole package from the start. They are looking for a firm that provides cloud-based accounting, daily bookkeeping, and financial controller services. They want training in their cloud-based accounting package, and they want it all rolled out quickly and easily.

Additionally, they want their accounting software to integrate with other business productivity apps, for added convenience and capabilities on-the-go. In today’s integrated business world, business owners want one company who can provide and manage it all. In 2012, 70% of the FAO contracts had elements of end-to-end scope, as opposed to a functional piecemeal approach, according to the Everest Research Group study.

5. Accounting consulting services and financial controllership

The Everest Group describes this particular business need as: “Predictive and prescriptive operational analytics along with integrated risk management and compliance.”

We can sum it up in two words: Financial controllership.

While your virtual bookkeeper is concerned with timely and accurate bookkeeping, including AP/AR and an up-to-date general ledger, your financial controller takes accounting to the next level as a business advisor.

If you’re concerned about GAAP compliance, business continuity, financial forecasting or consulting that relates to business processes and operations, AccountingDepartment.com’s virtual accounting team can help.

More and more today, as shown by the Everest Group report, businesses turn to virtual accounting firm for every aspect of financial accounting and management.

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