Accounting: To outsource or to hire in-house?

Hiring an accountant is essential for most businesses as their expertise in analyzing financial data, preparing, report, and maintaining financial records, filing taxes, and doing other financial tasks help ensure the financial integrity of the business. Two of the most common ways to acquire the services of an accounting professional are to employ accountants or outsource the services. They offer distinct advantages, namely the following:

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In-house

With an in-house accountant, businesses would have more control over their financial management. This is especially advantageous for organizations that have specific or unusual accounting requirements. If the leaders desire the accountant to share in the same culture, it is better to employ one.


Hiring in-house would also result in more efficient collaboration with the accounting staff because they are always in the same vicinity, and not a phone call or email away.

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Outsource

One of the primary reasons businesses opt to outsource their accounting needs is that they are cost-effective. Rather than have more workers in the payroll and shell out additional overhead expenses, they can save money by just paying a third-party accountant to do the job. There would also be no need to train accounting employees, and instead, allot more time for value-adding activities.


Outsourcing can also help reduce the risk of fraud, as long as the right accounting professionals or companies are hired.


For more accounting articles, visit this Bharti Jogia-Sattar blog.

Rookie accounting pitfalls company owners should look out for

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Many companies have been brought down by the mistakes of their financial officers and accountants. While some business owners could dismiss small accounting mistakes as negligible, their frequency could create huge holes. And then, some mistakes are so egregious, they cause not only financial problems, but legal ones as well. Experienced accountants are wary of these pitfalls. It’s the younger accountants that need to keep their eyes peeled.


Take for instance the common act of mixing personal and company expenses. This is also an easy mistake to spot. While some company owners and execs may try to slip some of their vacation expenses to the company, experienced accountants know that letting this kind of dealing slide may lead to incredibly serious repercussions, especially if the IRS decides to get involved.

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It’s the responsibility of the accountants and financial officers of a company to educate business owners on the serious consequences of the organization getting caught mixing these receipts.


Another rookie accounting mistake is not staying up to date with the tax laws of the state. Experienced accountants know all too well that tax laws are updated every so often. The company should be notified of such changes, and in the frequency they occur. Staying on top of these updates means that the business can avoid paying the wrong amount at the right time and avoid massive fees and penalties.


Bharti Jogia-Sattar is an expert in financial and corporate management and real estate. She has more than two decades of experience as a financial executive and an accountant. For more financial tips, visit this page.