With more than half a million new small businesses launching every month, you need every advantage you can get. For many business owners, looking for ways to save money is the first impulse.
It makes sense on the surface. The less you spend, the more you keep in reserve for business needs.
One way some business owners achieve this goal is by keeping everything, including accounting, in-house. Sometimes, outsourcing finance-related jobs offer better practical results.
So, should you outsource accounting or keep it a DIY job? Keep reading to learn which is the better option.
You probably file taxes on a quarterly basis. So how keen is your knowledge of the tax code?
Do you take advantage of all the available methods of tax liability reduction?
Keeping up on changes in the tax code often proves a monumental effort. For one, you must determine what the legalese actually means. Plus, you must keep track of changes at the state and federal level.
There’s a reason why accountants must meet continuing education requirements. Outsourcing your accounting means you get the benefits of all that continuing education. A professional accountant will save you more on taxes than any DIY approach.
Accountants do more than just find you tax breaks. They can also perform some kinds of financial analysis that will help you make better decisions.
For example, an accountant can help you better understand your cash flow. That lets you plan for recurring slow periods in your business.
They can also give you a better sense of how much money you have locked up in unpaid invoices, both right now and in general. Some accountants will help you set up a system for more timely invoice payments.
Beyond pure finances, outsourcing your accounting lets you focus on crucial business activities.
Say that you run a restaurant. Is your time better spent focusing on food quality and customer service or huddling over profit and loss statements?
Yes, you should remain aware of the financial situation. Actually crunching the numbers, though, just pulls you away from the things that drive profitability.
Plus, doing that work will take you far, far longer because your expertise lies in running a restaurant. Outsourcing lets you plug that time and energy into the business, rather than into spreadsheets.
Parting Thoughts on DIY vs Outsource Accounting for Your Small Business
The DIY vs outsource accounting question only looks complicated on the surface.
The DIY approach sounds like a good financial move because you don’t pay someone for that service. Since you probably didn’t pick up a degree in accounting, though, you spend huge amounts of your time on the process.
A professional accountant provides you with efficient tax services and sound financial analysis. That lets you pour all of that time and energy into running your business. That’s where your profitability really comes from.
The Accfin Group provides financial services for businesses, such as bookkeeping and payroll. For more information about our financial services, contact Accfin Group today.