By Jaelyn Larry
No matter the size of your business, you need a dependable accounting partner to keep your business running smoothly. Accounting in Western Springs involves managing cash flow, paying bills and employees, and understanding the overall financial health of a company. Because of your accounting needs, you may be confused about whether to build an an-house accounting team or outsource your accounting needs to a reputable firm that offers accounting services. Every option has benefits and drawbacks. Ultimately, the decision depends on the specific goals and needs of your business.
What to Expect from In-House Accounting
Historically, businesses depended on in-house accountants to manage their finances. Such a setup involves hiring one accountant or more, depending on the business’s size and complexity. The hired person will pay the bills, close the books, send invoices, and produce financial reports. An in-house team can include one bookkeeper or a team of accountants. The benefits of in-house accounting include the following:
- Dedicated focus. In-house accounts work only for your business. Thus, they are fully dedicated to the financial well-being of your company, offering focused attention and ensuring availability when problems arise. These professionals are quite familiar with your operations, allowing them to make decisions and solve problems quickly.
- Cultural alignment. Your employees align with the culture and values of your company. This allows them to communicate more openly and understand the goals and needs of your business.
- Immediate access. Maintaining an in-house accounting team means you can access financial expertise as necessary. This can be especially important in situations where problems need to be solved urgently and financial analysis must be done quickly.
The Problem with In-House Accounting
Despite the pros of having an in-house accounting team, it has some pitfalls including:
- Hiring challenges. Finding a qualified accountant is not easy. The shortage of accountants makes hiring a long, risky, and costly process. Also, you need technical expertise to vet candidates properly to avoid mistakes.
- Fixed costs. Maintaining an in-house team means paying for salaries, benefits, and even ongoing training. If you own a small business, this can be a serious financial burden for you.
- Need for several professionals. You may not find an accountant who can manage basic transaction processing, strategic financial planning, advanced accounting, and financial analysis. Thus, you may need to hire more professionals to meet the accounting needs of your business.
Outsourced Accounting
As technology advances and businesses shift to paperless operations, partnering with a third-party accounting firm has become a norm. Outsourced accounting teams offer different services including basic bookkeeping and complex financial analysis. They offer the following benefits:
- Cost-efficiency. By outsourcing, you just pay for the accounting services needed, leading to savings.
- Access to expertise. An outsourced accounting team brings a wide range of skills and expertise to the table. Usually, outsourced accountants have experience across several industries and stay on top of best practices and regulations.
- Scalability. The services of an outsourced accounting team are highly scalable, letting you adjust the support level according to the needs of your business. Whether you are expanding your business, downsizing, or dealing with seasonal fluctuations, your outsourced team can adjust quickly to offer the appropriate level of service.
As with an in-house accounting team, an outsourced team also has possible challenges. These include limited hands-on access and the possibility of communication gaps. However, the right accounting firm addresses these challenges by setting up communication channels during the onboarding process to discuss clear expectations and guidelines.
In-house and outsourced accounting have pros and cons. Your choice will depend on the needs, resources, and goals of your business. But for a lot of companies, outsourcing accounting functions offers the most benefits.
