The Top 4 Most Common Outsourced Accounting Mistakes to Avoid
You may be ready to outsource your accounting because it’s become too difficult to do in-house or you’re looking for a reduced management / lower-cost solution. But if you don’t go into the process with a clear plan or understanding of what you need, it can end up costing you just as much.
Here are the top 4 most common outsourced accounting mistakes you’ll want to be careful to avoid as you consider your next steps.
1. Not Defining Business Goals
If you don’t provide your accounting firm goals and objectives, it’s challenging for them to offer the right solutions to match your needs. Setting accounting expectations at the start will not only help your partner provide efficient service — it’ll help you gauge if they’re delivering what your business needs from outsourced accounting support.
Some examples of goals to consider discussing with providers as you vet your options?
Goal: Reduce the internal team’s time in accounting management.
Solution: Your partner can help set up standardized workflows in the areas that need them to streamline time-consuming processes.
Outcome: Your team is able to focus on the management and development of business.
Goal: Get support in complicated accounting areas specific to your industry.
Solution: Your partner can provide expertise and strategic recommendations based on their experience. (Since accounting is their focus, they are able to keep up with the latest regulations and updated standards.)
Outcome: You can have peace of mind your accounting is compliant and meets all accounting standards set.
Goal: Your current model is outdated but you need help updating and revising your strategy.
Solution: Your partner can help implement and train you on cloud-based accounting solutions that meet your needs and support your business goals.
Outcome: Your team can enjoy efficient and agile accounting solutions that make operations easier.
It’s important that you’re clear on what matters most for your business and your primary goal from outsourcing your accounting. And aside from just listing it, you should figure out how to achieve your goal and what measuring its progress looks like. That way you’re setting accounting expectations up front about what KPIs you’ll use to gauge success.
2. Not Hiring An Inexperienced Accountant
These days, a quick online search will show you there is no shortage of outsourced accounting solutions. But one of the most common outsourced accounting mistakes you can make is to choose someone lacking the right experience.
Each industry has its own accounting complexities and mistakes can pile up quickly if your partner isn’t an expert in your field. Plus, even if you’ve outsourced the accounting, at the end of the day your business is still fully responsible for its accounting.
So how can you vet partners to make sure they have the right experience and qualifications?
One way is to ask for referrals of other clients, maybe even ones in your industry, to talk to and ask questions about their experience. Also, look for proven results and assess what your potential partner’s track record looks like.
3. Not Having Proper Communication
Why is communication important in accounting? Ultimately, accounting is more than just crunching numbers and meeting regulations. It’s about positioning your business to run properly and efficiently, so there’s potential for growth in its future.
But if you don’t have the right communication from your outsourced accounting team, it’s harder to understand the state of your business and take steps towards growing it. Plus, it can lead to frustration for you and your internal team in day-to-day operations.
On the flip side, communication from your outsourced partner is only a piece of the equation. Another key part of communication in accounting is that you clearly provide information to your partner as well, to avoid misunderstandings.
During the early stages of selecting a partner, it’s important that all parties are on the same page right from the start. When it comes to setting accounting expectations make sure you:
- State your needs and requirements for outsourcing accounting.
- Communicate the goals you are trying to achieve.
- Ask potential partners if their services align with your needs.
- Explore how often you’re looking to have your accounting work delivered.
- Understand the communication you’ll receive from your partner.
- Request info on how to be in contact with your partner.
- Advocate for what you need from your partner in deliverables and communication.
4. Not Outsourcing The Right Areas For Support
While this ties into defining goals and communicating clearly, it’s important enough to pull out for consideration. You may walk into outsourced accounting thinking you know what services you need, but make sure you’re on the right track.
Consider any internal team members that are currently impacted by accounting and ask for perspective on areas that need improvement. A second perspective may help you identify needs you haven’t thought about. Plus, employee feedback is important, as it helps your team feel empowered, and providing space for it can increase their engagement.
Secondly, be open to learning about all the services your outsourced accounting partner can offer. There may be some support in place that you didn’t consider initially but could hold value for your business.
Because of their expertise, there may be ways they can not only standardize workflows, but can even use accounting to make a strategic impact. That way you walk away with correct and comprehensive support as a result of outsourcing to your partner.
Ready to Find Seamless Outsourced Accounting Solutions?
At Powered By Centri, our team has both the expertise and strategic mindset to help you not only outsource but improve your accounting. Our team of experts is passionate about finding the right solutions and making sure your accounting function supports your business goals.
Our team supports you with:
- Hassle-free onboarding: we take steps to lessen the load on your team and make switching to us from an in-house or different outsourced provider easy.
- Comprehensive collaboration: we learn about the ins and outs of your business, and its model, and get to know your stakeholders all to help serve your team better.
- Technical support: we will provide ongoing training and support to help you get the most out of your technical systems and any new ones implemented.
- Clear communication: we provide your team with cloud-based accounting solutions so you can manage everything in real-time.
- Strategic guidance: we have experience across many industries and business models, so we’re happy to support you in strategizing when you’re looking for expert advice.