When you run a small business, it can feel overwhelming to manage both your company’s day-to-day responsibilities and all of the financial obligations that go along with business operations. For that reason, small business owners often rely on external tools to help their organization run smoothly. Accounting software like Quickbooks is often seen as a replacement for professional financial management. Still, it takes someone with expertise in money matters to get the most out of apps like this. Small business owners just getting started may feel torn between DIY accounting software and a human financial professional, perhaps not even realizing the latter is an option.

Getting a head start on managing your business’ finances is essential for growth and success. Choosing a quick fix like a piece of accounting software alone can feel like the simplest option, but the benefits of outsourcing to a professional CFO could give your business the edge it needs in a competitive world.

Financial Management Software for Small Businesses

Small business owners have just as many financial responsibilities as larger corporations. The difference is they often have fewer employees to deal with these. Responsibilities range from calculating and funding tax payments to tracking and recording expenses and so many more. Many software companies, like Quickbooks, have created accounting software solutions to help small business owners manage each of these activities on their own. Financial management software and accounting software can be powerful and intricate. Some accounting software solutions allow a business owner to perform multiple financial tasks. Digital tools like these track expenses, automatically send payments to team members, process payments, pay taxes, and more.

Financial Management Professionals for Small Businesses

Commercial financial management professionals advise on or take over handling a business’s finances. Companies hire a corporate financial officer (CFO) or work with a certified public accountant (CPA) so that the rest of the organization can focus on running and growing the business. As a small business owner, you can hire a financial management expert to do any number of things for you, from simply doing your taxes annually to handling every aspect related to money and your business.

Financial management experts may be on a company’s staff and work in-house, or they might be hired as an outsourced professional who can guide and support a business.

Financial Management Software: The Pros and Cons

Financial software can be an affordable solution for small businesses. Some providers give the option to buy the software once or pay a regular subscription fee. Once you’ve done this, you have various financial tools at your fingertips. Accounting software options like Quickbooks allow you to have total control over your company’s finances so that you can work towards building and maintaining your business’ financial wellbeing.

Like all non-human solutions, however, there are drawbacks to using software solutions like Quickbooks on your own. DIY financial management software still requires extensive financial knowledge to get the most out of it. While extremely helpful, the existence of these apps doesn’t automatically make business finance simple. There are many commercial and industrial finance laws, and it is essential to be well-informed on these to ensure your company is complying with all rules and regulations. Additionally, managing your company finances can be an extremely time-consuming task. It is exacting but essential, and a small business owner who chooses to take a DIY approach to their finances may find that they spend more time managing money than they do managing their business.

In summary, here are some pros to using financial software:

• Can be more affordable depending upon your business budget
• Online resources available
• No need to hire additional employees
• Allows you to deal with business finances as and when is convenient
• Total control over company finances

And here are some cons to trying to manage your finances with software alone:

• No human touch – no advice on complex issues
• Requires financial expertise
• Requires an understanding of your industry’s specific financial laws or rules
• Time intensive
• No way to check that you’ve completed everything correctly without involving a financial expert

Financial Management Professionals: The Pros and Cons

Enlisting the help of a financial pro like an outsourced CFO means putting someone at the helm of your finances who has specialized knowledge of handling money for companies. They understand the laws and rules you must follow and have the experience to help with complex financial situations. If there is ever a nuanced financial decision you have to make, a financial professional can weigh your unique business considerations and priorities and make choices in line with your business goals. A financial expert is someone you can talk to for advice, not just about your accounts but about acquisitions, asset management, or any other financial aspects of your business.

One drawback of choosing a financial professional is that it could mean hiring a new person for your company when funds are tight. Choosing to outsource your financial management to a designated, outsourced CFO is a more affordable option, and one that still provides you with access to expertise in financial planning, tax preparation, and a range of financial advisory services. 

Financial professional pros:

• Financial expertise
• Understands finance laws for a wide range of industries
• Helps with complex or nuanced financial situations
• Empowers you to get your finances right the first time
• Avoids costly mistakes

Financial professional cons:

• Businesses may worry about the cost of hiring a full-time financial expert, which is why outsourcing as needed could be the best option.

Outsourcing your financial management to a professional means you get more than just software packed with mathematical formulas. You get advice based on your unique situation in the market, whether you run an artisan bakery in St. Mary’s County or an interior design team in Chesapeake. Reach out to your BradyRenner CPA for more information on hiring a financial professional whounderstands business in Maryland and can help you not only get the books done but take significant steps towards corporate success.