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How are Outsourcing Accounting Services Helpful during the Coronavirus Outbreak?
Coronavirus has left multiple businesses handicapped concerning the closing down of its physical operations, shortage of staff and equipment, disrupted cash flow, and more. Businesses are finding it hard to manage their internal processes, especially the accounting process since it demands the utmost accuracy. Most of the business owners have opted for the outsourcing option to deal with the accounting challenge. But is it actually solving their problems?
Let’s find out the same through the opinions of some industry experts.
1. Excellent Opportunity to Accountants who became Jobless due to Lockdown
Jack Paxton, Co-Founder of VYPER
Most major firms and their employees are currently on Lockdown due to the Coronavirus Outbreak.
High-level accountants that have had flourishing careers at these firms are now at home with no work. Either their company closed down due to the current circumstances, or there is no work for them to do.
This is probably the first time something like this has happened to these experienced accountants. Outsourcing these accountants who will work from home will be an excellent opportunity for them to get back to work and earn cash during the lockdown.
Working remotely might be new territory for a lot of these accountants that may have the skill, but no experience in remote work. You can negotiate a lower rate with them until they are settled to earn more.
If most of these accountants have lost their jobs during the lockdown, then outsourcing them can lead to a new career for them. They can build on their career, long after the lockdown is over.
2. Outsourcing enabled us Save on Payables
Matthew Ross, Co-founder and COO at The Slumber Yard
Your query caught my eye because we outsource all of our accounting and finance to a local CPA firm, and I’ve found their services to be extremely helpful during the COVID-19 crisis.
Most notably, my CPA helped me put together a game plan to get through this difficult time financially. She identified areas where we could reduce costs and push payables in order to conserve cash for necessary expenses. I’d estimate she helped me cut about $5k per month in unnecessary expenses and push about $30K worth of payables to June.
3. Outsourcing Payroll Saved against Time and Mistakes
Paige Dawson, President and Owner of MPD Ventures Company
We’ve outsourced our payroll for the past few years to Get Payroll, and have been very impressed with the personal service, automation and even lower cost than we had processing internally. It’s been seamless with direct deposits and filing our quarterly reports all virtually and electronically.
With the current coronavirus outbreak, we found another silver lining to using a payroll service. Our provider was able to quickly generate a payroll report to support the requirements for the Payroll Protection Program, which saved us time, questions, and possible missteps.
4. Outsourcing Saves Costs & Enhances Productivity
Brandon Pfaff, CPA and tax expert, serves on the advisory board for Wealthy Living Today
Outsourced accounting services are invaluable for companies right now. Many non-essential businesses still need to run their back-office function away from the office, and outsourced services can be a great alternative.
- First, it allows the business to maintain continuity if workers are laid off or furloughed.
- Outsourcing may even be a more cost-effective approach than paying employees to set up home offices.
- Additionally, the outsourced services are managed by the provider; the business will be more efficient with less concern about WFH employee productivity.
5. It Paves the Way for Strategy-Building and Stability
Scott Patterson, EA, CFP | �ore Financial Resources
Many small businesses are fighting for their life right now. They need to be in the trenches daily, making the critical decisions that�EFEFEFwill bring�EFin cash and keep their team employed. While it’s always important for businesses to know their numbers, times like this only enhance that need. Business owners should know:
- How much cash do I have?
- How much revenue do I need daily/weekly to break even?
- What expenses can I eliminate or delay?
- What expenses are accruing that I will have to pay later?
No one can do it all. Outsourced accountants and CFO’s can provide a source of stability and strategy as they work with the business owner to answer all of these critical questions. Those that believe they can do these themselves often get caught up in the emotions of the day.
An independent advisor can take some of the number-crunching workload over, but also provide that unemotional number-driven perspective. Outsourced advisors also work with many different clients and can add ideas, perspective, and encouragement from what they learn through other business they serve.
6. Their Prices are Comparatively Low Compared to an Offline CPA Firm
Outsourcing platforms like Fiverr has made it the task of outsourcing bookkeeping and accounting easy. One can easily find various types of services e.g. Quickbooks, tax returns, balance sheet, and income statements preparation.
Furthermore, their prices are very reasonable compared to an offline CPA firm. Since data is already available on a laptop, therefore, all one has to do is upload it to cloud storage like Google drive or mega. Then, that data is sent to a well-reputed freelancer on sites like Fiverr, People per Hour, and Upwork. The freelancer then completes the job, and that’s it.
7. Best Alternative to D-I-Y Accounting for Business Owners
Accounting and bookkeeping services are essential tasks to operate a business, but they aren’t the best use of any business owner’s time—especially now. Having someone on your side, outside of the business, who obsesses over your books, being perfect, is more important than ever. That trained “second set of eyes” on your finances actually provides more information than you’d get doing it yourself.
When there is so much uncertainty having a handle on your finances can be your guiding light to help you make other strategic decisions. Because of this, D-I-Y accounting is really a disservice to you as a business owner.
8. Outsourcing Benefits the Company and Accountants Simultaneously
‘Accounting is a really crucial thing to have, especially in the current climate. With many people’s businesses changing so that they can still work under these new conditions, you are bound to need help getting all financial accounts in order.
Outsourcing will both benefit you as a company and the accountants themselves. They need work, and you need their service. It is the perfect trade-off, which will help your business in the long run, even when all of this is over.’
9. It Helps in Fueling the Virtual Tax Preparation Demand
George Birrell, CPA | Get Tax Hub
We have seen a huge uptick in demand for virtual tax prep services since the pandemic hit the US. The obvious advantage of interacting with a CPA remotely during this time of crisis is fueling this demand. Our built-in infrastructure for this has proven to be a huge advantage, and we are happy to be able to provide this service in times, or crisis.
10. Outsourcing can Help You Sail Through the COVID-19 Crisis
Sean Nguyen, Director of Internet Advisor
We outsourced our accounting operation at the end of last year as part of a year-long optimization strategy. We felt the impacts in the first quarter of this year, but it’s even more useful now that coronavirus has everything in turmoil.
We get multiple updates a week, which is critical because of how quickly things are changing, and we also get recommendations on what to do to help the business continue to thrive despite the peaks and valleys.
But perhaps even more importantly, it means almost the entire internal team is thinking about big picture stuff. No one is caught up in the numbers. Instead, they have right in front of them and can make decisions about them that will help the company make it through this difficult time. If you need all hands on deck moving forward, you’d be wise to consider outsourcing your accounting operation amidst this crisis.
11. Outsourcing is always a Great Option, Irrespective of the Crisis
Paige, Founder & CEO of Global Marketing and Branding
Outsourcing is usually done to address a skills gap within a business. Outside expertise can be used to solve a problem identified as a hurdle to the next stage of growth. Firms like mine exist to provide this expertise; we spend our time honing our craft and learning the advantages, efficiencies, and how to navigate different problems within and across all parts of the discipline. Working with a variety of company sizes and industries, we gain a wide breadth of knowledge and bring that experience into your business saving our clients time, money, and frustration.
My advice, especially for small businesses, is to outsource anything that is not a core competency so that you can focus all your resources on what you do the best. I outsource legal, payroll, and accounting services for that very reason and put all my energy into building my brand and scaling my business. To avoid problems, give your outsource partners the goals to achieve, then get out of the way. This is their area of expertise, so let them find the path; do not micromanage them; it will only lead to frustration.
Outsourcing is a smart idea even without a crisis and does not solve all of your growth problems, but it sure frees up a lot of time and energy that can be better spent on things I enjoy doing and can get paid well for.
As a mentor of mine once said, any problem that can be solved with money is not a problem if you have the money. Great advice, indeed!
12. Outsourcing enables Growth and Scalability
Maria E. Denney, Owner of Beach Business Solutions, LLC
Outsourcing accounting during the COVID outbreak is helpful because it gives you the time to focus on what you can do to keep your own business afloat, whether that is adding new revenue streams on new platforms, cutting costs, or building new products to monetize, outsourcing your accounting during this time gives you time to focus on saving and growing your business.
13. Payroll Outsourcing is more of a Necessity during the Coronavirus Outbreak
Charles J Read, CPA USTCP
In the pandemic, like other disasters, is where payroll outsourcing becomes a necessity. Many business locations are closed, but the business still operates remotely. How do people get paid, how does payroll get processed, how do taxes get filed and paid, how do you respond with data to the state unemployment department on a massive number of claims.
A payroll service provider can provide solutions to all those problems. They can process the payroll remotely. They can distribute the net pay via direct deposit, debit cards, or if needed, mail checks. They, of course, can file and pay all the employment taxes as they would normally. They also can answer and respond to the various taxing agencies for the client.
14. Outsourcing lets You Gain Financial Insights through Expert Advices
Carmine, Consultant for the venture-backed startup Morphio
I’ve found outsourcing accounting to give me more time to invest back into marketing. This is more important than ever as we aren’t able to physically see clients. It’s also a great way to get professional feedback on revenue, expenses, taxes, and find ways to save during a time in which many companies have taken financial losses.
Typically, accounting firms offer many other services like payroll, HR, and others that further add to the value you receive. Since accounting and bookkeeping isn’t everyone’s strong points, it’s also a way to minimize risk. The last thing you want is to owe more money or make mistakes with finances.
15. Outsourcing Saves on Overhead Cost
Mariana Anchante, DTS Enterprises
In times of cash flow slumps, asking customers to pay upfront will help you improve the cash flow. If you collect anything less than your full fee in advance, you’re basically extending credit to your clients. But you’re in the law business, not the credit business. You’re assuming a lot of risks – but you’re not charging interest rates as the credit card companies.
And if a client needs credit, they can use their credit card or go to a bank. You should actively screen clients and not take problem clients. It may seem painful first, but if you pass no-pay or slow-pay clients, you will have more time for finding good ones.
This concludes the fact that outsourcing indeed is one of the best options when it comes to managing your accounting processes. It does not only help you during crises like coronavirus about throughout the year under normal circumstances as well. So, it is a viable option for the business owners amidst the COVID-19 outbreak, especially when they find it hard to invest in technology for their employees to work from home or keep track of their productivity.
Are you also in the same situation? If yes, you need not worry as with outsourcing; you get an expert team available at your service that is equipped with the latest technology and equipment. Join hands with the expert accounting team of Cogneesol to use payroll processing services and other accounting services. We have more than 13 years of experience in providing quality accounting outsourcing back-office support to CPA firms and businesses worldwide. Get in touch to start your 14-day free trial and let us prove our potential to you!
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