Have you ever wondered why some of the most successful entrepreneurs and business leaders wear the same outfit each day? It is said that Albert Einstein bought multiple versions of the same gray suit to limit the number of decisions made each morning to preserve brainpower. Steve Jobs wore the same type of blue jeans and black turtleneck to prevent decision fatigue. Most recently, Mark Zuckerberg has been known to wear the same gray t-shirt each day. His reasoning, “I really want to clear my life to make it so that I have to make as few decisions as possible about anything except how to best serve this community”. When he says “serve this community” he means serving more than 1 billion Facebook users.
So you are probably reading this blog wondering, what does wearing the same clothes have to do with outsourcing your business’s accounting and tax functions? To keep the analogy consistent with the clothing examples, it has to do with the many hats entrepreneurs and business owners have to wear each day. Being an entrepreneur often requires one to seamlessly shift back and forth between strategic planning, sales and marketing, human resource management, accounting, information technology, among other business functions. In everyday life there are only 24 hours in a day to contribute to running a successful business, growing your personal relationships, and arguably most importantly to live a healthy lifestyle.
Companies who take advantage of outsourced accounting and tax services save time and money, get access to timely and accurate accounting/bookkeeping services, and benefit from remaining compliant in all of their financial and tax reporting requirements. Does outsourcing accounting make sense for you and your business?
Positive Outcomes from Outsourcing
- Hiring an expert – First and foremost, outsourcing accounting and tax services to a CPA firm can help you rest at night knowing that you have hired experts to help you remain compliant with your ongoing financial and tax reporting obligations. CPAs are effective at assisting business owners in understanding how to use their books to understand and improve the overall health of your business.
- Financial and Time Savings – In many cases, outsourcing services whether it is accounting or tax services, IT services, recruiting services or any other services may result in cost & time savings. Cost savings are derived from avoiding the costs related to employee payroll taxes, workers compensation insurance, unemployment taxes, health insurance, paid-time-off, and any other benefits your company may offer. In addition, business can also save on office space, furniture, computer equipment and software. The cost savings resulting from outsourcing can be significant. Time savings are accomplished by not having to hire, train, or manage employees. This can alleviate some of the hats mentioned above.
- Continued Growth – Most of the time entrepreneurs get started because they have a skill, product, or passion that they believe if combined with their relentless drive to succeed will result in financial gains and a life worth living. Outsourcing accounting and tax functions can save you from getting lost in the monotonous details of bookkeeping and taxes and can help you maximize the time spent following your passion and leading your business forward.
Despite some of the benefits listed above, many small business owners choose not to outsource their accounting and tax functions. Distance, response time, less control, and security risks are some of the potential concerns related to outsourcing. While various cloud based technologies such as QuickBooks Online, Skype video conferencing, and secure document transfer portals such as ShareFile have greatly reduced the challenges associated with not having a team member physically in-house, there will always be various limitations associated with outsourcing services, but the accounting industry is continuously evolving to minimize and possibly eliminate these limitations.
If you are interested in learning more about outsourced accounting and tax services, please keep an eye out for our next blog which will describe some of the types of outsource services we provide for our clients.