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6 Signs Real Estate Business Need to Outsource Accounting
With the boom in population in the last few decades, the real estate business has earned huge profits. Real estate has turned in to one of the most lucrative businesses. Increasing profits and a large number of transactions bring upon the need for maintaining accounting records.
Real estate industry is quite unique in the sense that the cost of transactions varies from very high to very low. For example, the sale of a house can bring in millions as revenue whereas the purchase of a particular raw material for construction involves lower costs. But the real estate business involves a large number of transactions.
In order to maintain a proper record of the various transactions, a real estate firm should possess a sound accounting team. Proper execution of accounting tasks is also essential for determining the profits or losses, payment of taxes, and future financial planning.
In the present scenario, the third-party real estate accounting services have become extremely popular. Some real estate owners are reluctant to use these services and rather rely on their in-house staff.
Signs for opting to outsource accounting services for real estate business
1. A limited number of staff members
In case a real estate firm has a limited number of staff members who are facing work-related pressure, then outsourcing some of the noncore activities like accounting can prove to be a good option.
The limited staff can be employed on the more productive activities of the organization and the profitability of the organization can be enhanced.
2. The firm is looking for cost-cutting measures
In case the real estate firm is looking for cost-cutting measures due to the shortage of funds, then outsourcing the real estate accounting services can be a good option. Outsourcing accounting services helps in eliminating the need to employ accountants and spending on payroll and infrastructure.
Moreover, as most of the outsourcing services are based in developing nations like India, China, Argentina etc., the costs charged by them are considerably lesser than the local wage rates in nations like USA, UK, Canada etc. So outsourcing offers an opportunity to save valuable finances.
3. Failure to meet regulatory compliance
The real estate accountancy regulations keep on changing from time to time. An outsourced accounting team will ensure that the all these regulations are kept in mind while maintaining the accounts.
The outsourced accounting services will also ensure that the taxation regulations are properly followed and the real estate firm doesn’t have to face any tax-related penalties. So if a real estate firm is failing to meet the regulatory compliance, then outsourcing is a good option.
4. Core functions are suffering
In a real estate firm core functions related to profitability are customer relationship management and sales. In case these important functions are not yielding the right results then it is high time that some of the non-core activities like accounting are outsourced and greater emphasis is given to the profit-oriented activities.
5. Lack of latest technology infrastructure
Suppose the accounting functions of the real estate firm are complicated and require the latest accounting software then accounting services can prove useful.
The outsourcing firms possess the latest software like QuickBooks, NetSuite etc., and have staff expert at using them. So instead of investing in the latest technology and training your staff in using it, outsourcing is the best option.
6. Lacking a competitive edge
Suppose your real estate firm is lagging behind the other competitors, and then obviously you need to look at your overall strategy. An outsourced accounting team can offer much-needed advice which can help in the right financial planning.
Cogneesol is among the leading outsourcing companies offering real estate accounting services all over the world over the past eight years. These services are meant for enabling the business organizations to concentrate on their core activities, reduce costs and maximize profits.
Cogneesol possesses expert staff and latest technology required for performing the tasks as per customer satisfaction. By offering prompt and quality results, they have earned the goodwill of their clients.
To know more, contact us at [email protected] or call us at +1 646 688 2821.
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