In today’s ever more competitive business world, executives are always on the lookout for new ways to gain efficiencies. Whether it’s through cutting costs or embracing new technologies to streamline labor-intensive workflows, there’s no shortage of opportunities for business leaders looking to optimize the way their business operates.
One area where many businesses are unlocking increased efficiencies is back-end accounting and finance functions. The tasks performed by these teams range from running payroll to preparing financial statements. Traditionally, they have been performed by professionals ranging from part-time bookkeepers to fully-fledged CPAs, depending on the size and sophistication of the business.
In recent years, outsourcing these back-office functions has become increasingly popular with a wide range of businesses, from fast-paced startups to established real estate businesses. Outsourcing these functions not only allows businesses to address many of the frustrations they have with their existing approach to finance and accounting, but it also unlocks a wide range of benefits.
G-Squared Partners provides outsourced accounting, bookkeeping, and Chief Financial Officer services to businesses across a wide range of industries. To learn more about outsourcing your business’s back-office accounting functions, contact us today.
Which Back-Office Accounting Functions Can Be Outsourced?
With the right approach and partner, practically any back-office accounting function your team has handled in-house can be outsourced. The key to success lies in finding an outsourced accounting team with a flexible approach, proven processes, and a commitment to using best-in-class accounting technologies.
Generally, there are two main categories of back-office accounting functions that can be outsourced: accounting tasks and bookkeeping tasks. Many vendors offer an outsourced CFO service that connects business leaders with experienced financial professionals who can advise on strategic issues.
Below are some common back-office accounting functions that can be outsourced to an external vendor.
Outsourced Bookkeeping Tasks
The goal of bookkeeping is to maintain accurate, timely financial records that provide leaders with a clear understanding of the business’s current financial position. This entails several tasks, including:
- Monitoring accounts receivable and sending invoices
- Processing accounts payable
- Recording and categorizing transactions
- Reconciling bank accounts
- Running payroll
Without reliable bookkeeping, it's impossible for leaders to know exactly how their business is performing. While many bookkeeping tasks may seem relatively simple, they are the financial foundation on which all successful businesses are built, and it’s vital businesses get them right.
Outsourced Accounting Tasks
Accountants have a wide variety of responsibilities. These include analyzing the business’s financial performance, partnering with various stakeholders including the finance team and external tax advisors, and more. Key tasks that can be outsourced include:
- Month-end close processes
- Preparing financial reports and statements
- Overseeing bookkeeping staff and processes
- Partnering with Independent Public Accountants to prepare tax filings and assist with audits
- Budgeting for future accounting periods, forecasting financial performance, and comparing actual performance against budgets and forecasts
By outsourcing these tasks, businesses can unlock a wide variety of benefits. Let’s explore some of the most attractive of these benefits in greater detail.
Five Benefits Businesses Realize From Outsourcing Back-Office Accounting Functions
Back-office accounting functions are fundamental to the running of any business, but they can be time-consuming, labor-intensive, and difficult: particularly if your business lacks the internal resources to effectively manage them.
Solving these challenges is one of the primary reasons business owners outsource accounting and bookkeeping tasks to a specialized provider, but there are others too. Below, we summarize five of the key benefits businesses can expect to reap from outsourcing.
1. Cost Savings
Recruiting, staffing, and resourcing an internal accounting and finance team represents a significant investment. For growth-stage businesses, that’s an investment that could be better spent elsewhere: whether that’s by hiring more software engineers or by increasing the marketing budget.
Working with an outsourced accounting team tends to be much more affordable than building out a full internal team. Many outsourced accounting relationships begin on a relatively small scale and then expand over time as the business’s financial needs evolve.
2. Time Savings
Maintaining a back-office accounting team isn’t just expensive, it’s also time-consuming. Founders and executives are responsible for hiring, onboarding, training, and overseeing their back-office staff. Even worse, if your business is an early-stage startup, the founder, CTO, or COO might be managing accounting and finance functions by themselves.
Regardless, overseeing or performing back-office tasks likely does not represent the best use of senior executives’ time. By embracing outsourcing, leaders can gain that time back, freeing them to spend less time on the financial minutiae and more time on big-picture strategic initiatives that move the needle.
3. Increased Financial Clarity
Understanding the financial performance of your business is vital for leaders. Without this understanding, it’s extremely difficult to make decisions, allocate resources, and plan for the future.
Underinvesting in back-office accounting functions results in business leaders effectively guessing when it comes to making these decisions for their business. Partnering with an outsourced accounting firm gives leaders access to real-time financial information, enabling higher-confidence decision-making.
4. Industry Expertise
Different types of businesses demand different approaches to accounting. The accounting processes that work for a well-established real estate firm are entirely distinct from those required by a fast-growing SaaS startup.
By choosing the right outsourcing partner, businesses can outsource their accounting function to a partner with proven experience in their industry. At G-Squared Partners, we have significant experience in a variety of industries, including technology, and understand the nuances of accounting for different types of businesses.
5. Scalability
Today, finding accounting talent is difficult. The industry is experiencing a talent shortage, with fewer new accountants qualifying each year. For businesses trying to build out a back-office accounting function, that represents a real challenge. The hiring process might take weeks or even months. Throughout that period, your business is falling behind.
Outsourced accounting providers already have teams of accountants in place and can often be onboarded to your business within a week or two. Additionally, these external partners have the resources to grow with your business as required. Outsourced accounting relationships often start with simple bookkeeping tasks and expand over time to include strategic advisory services.
Outsource Back-Office Accounting and More to G-Squared Partners
Outsourcing back-office accounting tasks can help businesses build a new layer of competitive advantage. Leaders can invest the cost and time savings they realize into exciting new initiatives that drive future growth while benefiting from seamless access to higher-quality financial information.
However, businesses can only realize these benefits if they partner with an outsourced accounting firm that’s a good match for their business. At G-Squared Partners, we strive to be exactly that.
Our outsourced bookkeeping, accounting, and CFO professionals are equipped to handle all of a business’s accounting and finance needs, from closing the books every month to assisting with M&A transactions.
To learn more about outsourcing your back-office accounting functions to G-Squared Partners, schedule a call today.