Pros and Cons of In-house Versus Outsourced Accounting

[Account Closed]

Regardless of the nature of your business, it is critically important that you maintain accurate and up-to-date financial records. Managing your books will not only help to evaluate the performance of the business but to also understand the financial position. Some of the other services associated with accounting are tax filings, payroll, financial statements and financial advice. While most people contend that bookkeeping should be handled by experts, some business owners may not know whether to go for in-house or outsourced accounting services. Here are some of the pros and cons of in-house versus outsourced accounting.

Affordable Way to Meet Specific Accounting Needs

If your business has unusual, specialized and specific accounting needs, you will save a significant amount of money if you hire an in-house accountant. Outsourcing the services is likely to cost you more. Hiring your own accountant will also help to ensure that the specific needs of your business are met effectively.

Proximity

Maintaining books requires a lot of collaboration between the different departments of the business. In-house accounting will give you access to an expert sitting in an office next door or in the same building. Rather than communicating with an expert through a phone call or email, the expert will be available either instantly or in a few minutes.

Ability to Multitask

Multitasking is at the core of any growing business. With the different tasks that experts have to handle at any particular time, external workers may not have the time and skills to meet the specific needs of your business. If you have an in-house expert, you will be in a position to adjust various functions to fulfill the new needs of your business.

Loyalty

Loyalty is an important value in the running of any business. While an exter∑nal accountant will have other clients to attend to, an in-house expert will be loyal to your business. The expert will belong to the company, a factor that will assure you that sensitive financial information will remain within the four walls of your offices. Using the various web application firewall will also help you to prevent potential breaches.

Control

As a business owner, you will want to have control over the tasks that your employees perform as well as the processes they follow. In-house accounting gives you a certain level of control over how things work within the business. You will be able to train and manage your staff in a way that will allow you to achieve your business goals.

Cost

While in-house accounting will help you save money in terms of specific needs, it will be a more expensive option during the quieter times of the year. When there isn’t much accounting work to be done, the in-house expert will less useful, a factor that will result in high costs but low benefits. Outsourcing the services gives you the chance to request the services just when they are needed.

Limited Expert Services

In comparison to outsourced accounting, in-house accounting will limit your access to expert services. Third-party service providers will not only specialize in specific fields but will also hone their skills in order to boost the quality of their work and keep up with the competition. Some of the services you can expect include payroll, tax filings, financial statements and financial advice.

Challenges When Hiring

In case you have little knowledge of accounting, you may have a difficult time picking the right candidate to be your in-house accountant. It may also be difficult to identify the qualifications and attributes that will help meet the needs of your business. Outsourcing, on the other hand, gives you access to some of the most qualified professionals in the field.

Irrespective of how you choose to manage your books, it is important to ensure that all your information is safe. In a business world where data plays a critical role in decision making, you must protect your data from unauthorized access and from being compromised.