People establish their business in the belief that it will grow well. But with growth comes the need to adapt the way the business is run and managed. This is imperative when it comes to accounting and bookkeeping as running in-house system is both ineffective and expensive.
These days, outsourcing is becoming more and more popular in the business world. Even big companies are turning to it because it allows them to get the benefit of expertise at a lower cost. Bookkeeping and accounting services offer a great example of the benefit of outsourcing. Most businesses are not that big enough to keep a full-time accountant, and even if they are, it’s often cheaper to hire the services of an established accounting company. Well, for many, it can be confusing whether to outsource these services or not.
Here are some of the signs that may indicate that you need to outsource your accounting and use bookkeeping and accounting services.
1. Less knowledge about accounting
Different parts of bookkeeping and accounting need different approaches. Not all accountants know or have proper training and kept up to date on all of them. It is also quite hard to assess whether the in-house staff has the necessary know-how to step up performance and keep abreast of changes as your business expands.
2. Accounting too hard to handle
As your business expands, the cash flow, records, and reports become harder to handle. Quite often it is not possible to leave it in the hands of in-house staff, especially when the same team has to manage other areas of work as well.
3. Revenue grows, but not seeing the profit.
This is a vital sign that you should think about your accounting position. When you see the revenue growth, but that isn’t significant if your company is not showing similar growth in profit. So, it is better to turn a professional for assistance.
4. Finding inconsistencies in your accounting
Sometime in house systems result in the same people covering both the billing and transactional aspects, and there is very less supervision or control to avoid mistakes and to ensure that there is no fraudulent activity. This is one of the main reasons for inconsistencies, and that is why it is better to outsource the accounting activity.
5. Financial reports are not up to the mark.
When you have investors, or you want to raise capital from financial institutions, you need financial reports that display an accurate picture of your company’s financial health. It is hard for the in-house division to handle this task. That is why many business owners consider outsourcing bookkeeping and accounting services.
6. Business grew rapidly
Growth brings more customers, and that means more transactions to bill and record. It also needs increased staff to serve the customers and more demands in terms of accounting and bookkeeping. Outsourcing the service at this point is the wisest financial decision.
The UAE differs from many other countries in having lower and fewer tax requirements, but there are regulations. Outsourcing your accounting services could keep you in line as far as the rules and regulations are concerned. That is why it is better to hire a professional accounting firm.
In the long run, outsourcing these services can keep your business on track to extend its growth and increase its profits.