The proper management of the financial aspect of your business plays a crucial to its growth. You need to ensure that all records are updated and your financial data is accurate so that you can make smart business decisions.
Deciding to outsource your finance and bookkeeping needs is a great way to save on expenses and ensuring that your financial tasks are done on time, particularly payroll. It also provides you with technical skills and experience that is otherwise out of your reach.
But before you finalize your decision to outsource your finance and bookkeeping, make sure to ask yourself these questions first. These questions ensure that you are making the right choice in outsourcing and choosing your outsourcing partner.
Let’s go over them one by one…
1. What finance tasks should I outsource?
Figuring out which tasks to delegate is important because it will decide what type of services you should avail and the type of staff that you need. Go over your finance tasks and see which areas you need help with. You don’t have to outsource everything. You can keep some of the sensitive tasks in-house and outsource those that are time-consuming or those that need particular financial skills.
Here are some of the finance tasks you can outsource:
- All forms of MYOB, XERO and Quickbooks data entry
- Preparation of reports
- Payroll maintenance, including wages, superannuations, workers compensation, etc.
- BAS, IAS and Income Tax preparation and submission
- Bank reconciliation and preparation of financial statements
- Recording and reporting
- Accounts Receivable
- Accounts Payable
- Invoicing and Debt Collection
- Cashflow Management
2. Should I hire a team or a full-time accounting VA?
The kind of staff that you need depends on the type and amount of tasks that you want to outsource. If you run a small business and you need someone to deal with all your bookkeeping needs, you can consider hiring a full-time accounting or bookkeeping VA. If you have a lot of finance tasks to complete, you should consider hiring a team instead.
3. Is my data protected?
Data breach is one of the biggest fears in the outsourcing community. Before you sign the contract, ask your outsourcing partner what security measures they have in place to protect your data and online policy. If you can, keep sensitive data in-house to minimize the chances of data loss.
4. What is the turnaround time?
One of the advantages of outsourcing is a faster turnaround time. Confirm with your outsourcing partner how long the tasks will take to complete and set reasonable deadlines. You should also agree on which timezone to use, especially for outsourcing agencies that have different timezones.
5. What accounting software does my outsourcing partner use?
This is a piece of important information that should not be neglected. Your outsourcing partner should use the same software you are using to process your data. This is to avoid errors and keep the format consistent. Some software is also unable to process data that came from a different system.
These are the common accounting and bookkeeping software that is used in the finance department:
6. What experience does my outsourcing partner have?
You want to work with an outsourcing partner who has relevant working experience in the type of work you want to outsource. There are a lot of outsourcing companies that offer finance and bookkeeping services so you need to choose which one has the most relevant experience.
7. How much do the services cost?
Cost savings is one of the reasons why companies outsource. However, it is not advisable to go with the cheapest option. If you do, you might have more problems than you signed up for. And they can be costly. If you want quality work, you need to be willing to pay for it.
Outsourcing comes with both benefits and risks. To minimize wrong decisions and mistakes, ask yourself these questions first before finalizing your contract.