As a small business owner you’ve worked for years to establish and scale your business, likely wearing several different hats along the way. But at this point, you might be feeling a bit overwhelmed by all the numbers — receipts, P&L statements, invoices, spreadsheets, and tax slips. And you’re not alone. OnePoll Data reports that more than 50% of small business owners face similar challenges – and end up making critical business decisions based on an incomplete understanding of their finances.

If you’re wanting to grow your business, but you just don’t have the time or in-depth knowledge to expertly guide your in-house financial management, then you may want to consider enlisting the help of a dedicated professional. Outsourcing small business accounting and CFO services is one of the most strategic decisions you could make as a business owner. That is, if your goal is to create a business that you work on, instead of in.

In this article, we continue our six-part series on how a CPA can help small businesses as an outsourced financial services provider by taking a look at 5 reasons CEOs should outsource their accounting department.

1. Save Money

Every business owner wants to save money. More money saved means more money in your pocket at the end of the month. But hiring a full-time, in-house accountant or chief financial officer (CFO) can be quite costly. When you bring on employees to staff an in-house accounting team, you have to weigh the inevitable overhead that comes with maintaining a full-time department.

In addition to your employees’ base salaries, you also have to cover paid time off, vacation time, insurance, bonuses, and the wide variety of other benefits that go along with having an in-house team. Plus, there’s the time and money spent on hiring, onboarding, and training them to get up to speed.

On the other hand, outsourced accounting can be much more cost-effective. It’s an efficient way to tap into financial expertise for a fraction of the cost of an in-house team.

2. Save Time

If there’s one thing you can never really get enough of as a small business owner, it’s time. You know you’ve got half a dozen tasks on your plate you have to finish… but you can’t get to them if you’re bogged down with crunching the numbers to see if you’ve hit your break-even point. There just never seem to be enough hours in the day to get everything done when you’re the CEO. 

However, every department you have is contingent on your business’ financial sector. If you neglect it, you could run into serious trouble like being caught without the funds to support an unforeseen expense, not raising enough capital for a new project, or having to lay off half your staff due to mismanaged cash flow.

That’s where an outsourced CFO can come in. They can spearhead the financial division of your company so you can get your time back. You’ll be free from handling financial tasks like budgeting, payroll, reconciliation, debt management, cash flow, and more.

When you outsource your accounting, you regain time in your schedule to get to those critical tasks you’ve been pushing to the side. This will enable you to scale your business while having the peace of mind that your finances are being properly managed. 

3. Access Expert Financial Advice

When you’re dealing with the day-to-day functions of your business, it can be easy to lose sight of your organization’s true financial health. Hiring an outsourced financial professional can give you a fresh set of eyes and provide you with new insights on how to optimize your business. Because they’re not involved in the minutiae of daily operations, they’re able to give you impartial advice about your business’ finances.

Your outsourced CFO’s main priority is to provide you with their financial expertise so your company can continue to thrive, whether that means managing your cash flow better, increasing profitability, or scaling your business.

4. Receive Proactive Financial Accountability

Leading a company often means diving into various departments to ensure they’re running well. But, as you grow, it can be difficult to keep an up-to-date eye on things — including your finances.

When you outsource a small business CPA, you’ll receive timely and consistent reports on the state of your company’s finances so you always know where you’re at. Instead of getting confused or frustrated as to why you didn’t see much of a profit in a given quarter, you’ll have a clear picture of your financial health month-to-month.

An outsourced CFO will help keep your finances accountable and in check even if you don’t have the time to run reports and assess everything yourself. This will provide you with a dynamic view of your company’s financial information so you can make smarter business decisions every month.

For instance, an outsourced CFO may advise you to raise capital for an upcoming quarter when plenty of major invoices are due. Or, they might suggest you reduce the size of an upcoming purchase from your supplier because too much cash is being tied up in inventory.

5. Improve Productivity

Most people are really good at one or two things. However, small business CEOs typically have a host of responsibilities — some of which are outside their circle of expertise. This can lead to less than ideal business decisions — a problem that can be averted by delegating effectively.

If finances aren’t your forte, then delegating that department to an outsourced CFO could be the best decision to optimize your productivity. 

For one, you’ll have the immediate benefit of freeing up your time so you can focus on the things that make your business successful. And secondly, you’ll have a new level of financial expertise to support the growth of your business so you have more cash flow to scale for greater profitability.

Outsource Your Small Business Accounting Today

There are significant advantages to hiring an outsourced accounting department. It’s a smart way for a CEO to save time and money, access financial expertise, get up-to-date financial information, and improve productivity.

Good accounting is a vital part of running a successful business, but it’s also complex. It requires specific industry expertise and the time to manage transactions, forecasts, budgets, and other nuanced financial matters effectively. Without a reliable CFO, your small business could be left adrift to experience hardships like poor cash flow, unnecessary layoffs, or worse yet — bankruptcy.

BradyRenner’s team of CPAs is the accounting resource needed to ensure your business is running smoothly every day. We’re a full-service regional CPA firm that provides outsourced financial services for growth-oriented small businesses in the Baltimore-Washington region.

Our team of financial professionals will help you grow your business, give you more time, and provide you with the peace of mind of knowing your finances are in good hands. If you have any questions or want to learn more about our outsourced financial services, reach out to us at BradyRenner today.

Stay tuned for the next article in our series, where we’ll explore different ways that smart tax preparation with a CPA can grant more freedom to business owners.