Accountancy is one of those essential services for any business, big or small. It’s needed on an ongoing basis for good financial planning, investment and to be able to manage cash flow. While we may often think of it as arguably not really part of the business per se, it is a key ancillary function that can cripple the business if not performed correctly.
It may not always be a core human resource in many businesses, so outsourcing accounts is a good option for keeping a handle on managing finances. If the accounts are going to be outsourced, be sure of the following:
What it is that you need to be done
Accountancy is a wide and varied field, and before you even start looking for an accountant, you should be clear as to what it is that you actually need to do. Do you need audited financial statements, a financial report for your board, ongoing management accounts to monitor and control cash flow and expenses or an entire audit, or assistance with investment? The list is endless, and hiring the wrong firm based simply on your need for an accountant can be a costly mistake.
The scope and requirements
Once you know what it is you need, define the exact scope of the contractor or outsourced services role in this process. Will they drive the entire process or simply do one or two components of the planned process? These are the kinds of questions that you need to be clear of before contracting begins.
Data security and privacy
The firm that you go with must have a shared understanding of data security and privacy. Allowing someone into the business and providing them with all of the financial records or even just some of these will require a great deal of trust and the ability to show that they understand these aforementioned issues in relation to data protection and the safety of your company information.
Once you have figured these initial issues and aspects of the engagement, then you will need to look for a firm that can:-
Bookkeeping and accounting
These are the basics, and any outsourced accounting service must have as their foundational standards a vast knowledge of current and applicable industry standards for accounting and bookkeeping. The manner in which financials are presented and the balance sheet is drawn up should meet the basic standards and will form the basics of any financial and accounting strategy. Ensure that your outsourced service has a recognized and positive reputation for this.
There is an ongoing debate as to whether payroll is an HR or finance function. For the small business that has no dedicated HR, payroll needs to be handled by the same person or people that do your accounting and bookkeeping. An accounting firm that can do your payroll is an added bonus and should be a consideration.
Elements of financial planning
Being able to prepare the monthly management accounts and then use these for financial planning and any savings and investment opportunities is one of the specifics that you may be hard-pressed to find, but be assured there are those who offer this as part of a managed accountancy contract. Plummer Parsons professional accounts in Brighton are a prime example of this and worth having a look at even just for reference as to what should be available for you and your business.
Have a solid reputation in the field
There is no reason to use a firm that has no pedigree. Your business financials are not something to be trifled with. If the prospective service providers do not have a solid reputation, then you need to start your search again. Read previous customer reviews and check to see that they have the right registrations and certifications to produce the financial and accounting assistance you need.
Key to any managed service is a clear line of communication and a named person that you will be able to actually speak to and even meet with. There is a reluctance to talk money, yet when it comes to securing a managed accounting service provider if you aren’t able to cogently communicate, you may be found down the wrong path.
If you are looking to outsource your accounts, these traits and tips should get you ready to ensure the relationship is a success. Knowing what you need and where the gaps are in your current capacity are key to building that relationship.