Are you dealing with your own in-house bookkeeper or accountant? Find out why doing this can put your business at risk. Learn about other options, including the benefits of outsourced accounting and accounting in the cloud.
Here's an excerpt from our report:
Don't Put Your Eggs in One Basket: Why Relying on a Single Person for Your Accounting Needs Can Be the Greatest Risk Your Company is Facing Today
Hidden Costs of Relying on a Single Bookkeeper or Accountant
Relying on a single person to handle your accounting needs is a major gamble:
Loss of Insight: Perhaps the biggest, but least obvious, cost of relying on one person for your accounting is the loss of the advice an accountant can offer your business. The reports that your accountant writes provide insights into estimated spending, possibilities for investment, tax forecasts, and other key elements of your financial planning. They are also keeping their finger on the pulse of the industry as a whole by working with other companies.
When you rely on just one bookkeeper or accountant, that person's range of vision is limited to your company. You are placing all of your faith that a single individual will have enough bandwidth to keep up-to-date with the latest trends and financial news. Your in-house accountant may do a great job with your finances, but you lose the benefit of an outsider's insight and guidance. When you outsource your accounting to a team or cloud service, that team has the industry knowledge gained from working with many companies of different sizes and types. They will be able to see patterns and keep your business moving with changes in the market.
Institutional Knowledge: If your single in-house employee goes on vacation, maternity leave, medical leave, or simply quits, you would be placed in a vulnerable position to make sense of your own books, especially if something urgent came up. Relying on just one person to keep your books means that you are entrusting all of the knowledge about your business's accounts to that individual, and without him or her, your business could be left in a lurch. Outsourcing your accounting to a team or service gives you the added security of having multiple skilled people who have an understanding of your business's finances. You will have a team to back you up seamlessly so you do not have a gap in your bookkeeping or accounting processes. You'll save time, energy, and money when complicated or time-sensitive issues arise.
Internal Fraud: While you would like to trust everyone you’ve hired, employee fraud can be a huge financial burden for business owners. Without good internal controls and redundancies (i.e. having multiple sets of eyes on your books), insider theft can happen easily. It is rare for anyone in the company other than the in-house bookkeeper to check the work or review the books. Most business owners are too overwhelmed with running their business and often hire an in-house bookkeeper because they don’t have the knowledge maintain their own books. Thus, they also won’t be able to spot any errors. An outsourced accounting company would not have access to your blank checks, checking accounts or withdrawal numbers. As clearly stated in your agreement with the company, there would be a natural system of checks and balances to help pinpoint errors and oversights.
Get your FREE copy today!
Keeping informed of the latest accounting strategies and best practices is essential to the growing success of your business. At KYB, we offer free educational and informative tipsheets, reports, and eBooks for your convenience.
We would love to have a chat with you and see what we can do for you!