How much do outsourced accounting services cost and other answers to your questions.
Our Guide to Outsourced Accounting Services: Costs, Benefits and Other Questions
Is it time to scale up your finance team? In this guide, we break down the pros, cons and the costs of outsourced accounting services.
What’s covered in this blog?
- Pros of outsourced accounting services
- Cons of outsourced accounting services
- What do outsourced accounting services cost?
- 17 questions to ask an outsourced accounting service
- How do outsourced accounting services work?
What are the pros of outsourced accounting services?
Here are 10 benefits to outsourced accounting services:
- 360-degree accounting: Depending on the outsourced accounting firm, they can offer accounting services to meet your stage of growth, from bookkeeping to CFO-level strategy.
- CFO strategy for less: Understand where you stand and where you need to go. The cross-industry experience will bring an array of expertise and relevant strategy to your business.
- Savings: there is the potential for saving both on salary and software costs.
- Easy onboarding: Established firms should have a seamless onboarding process for transitioning to their services because if they have a decent client roster they will have done this a few times.
- Reduce your HR headache: (We manage your financials and our team).
- Improved financial reporting: They have established systems in place to provide accurate and reliable financial reporting.
- Automation: Outsourced accounting services often have partnerships with vendors to automate and improve your accounting cycle at a savings which is typically passed on to you.
- Risk management: With an established firm you can (and should!) expect a certain amount of risk management and security.
- Avoid common pitfalls: Having someone (aka an outsourced accountant) who’s gone through a few rounds with many other businesses can help you avoid common pitfalls that you might otherwise miss.
- Save time: with an expert team looking after your books, you can focus on what matters most to you in your business whether it’s product development or connecting with customers.
What are the cons of outsourced accounting services?
- You know that saying out of sight out of mind? If you don’t find the right firm, communication with an outsourced accounting team may not be as regular as you’d like.
- You have to hand over part of your business to an external party. Easier said than done for some. We get it!
- Not all outsourced accounting services are U.S.-based. (We are!)
- Outsourced does not always equal cheap (but with a good firm you can expect good value). Depending on your needs you may have to spend more for a service than you thought. Or you may end up paying for a service that you won’t use if everything is bundled into one fee. But, usually it is still cheaper than hiring an in-house accounting team. For example, in 2021 these were the average salaries according to Salary.com:
- Bookkeepers make an average of $44,767;
- Controllers make an average of $223,544;
- And CFOs make between $301,297 and $503,100
What do outsourced accounting services cost?
What do outsourced accounting services cost?
Our outsourced accounting services costs begin at $500 per month for our Base Package, $2,500 for our Core Package and $4,000 for our Core + Awesome Outsourced CFO Services Add-On.
17 questions to ask an outsourced accounting service:
- How long are your contracts?
- Do you bill hourly, monthly or on retainer?
- Are your staff all based in the United States?
- How do you communicate with clients and how often?
- How much time do you need from me or company representatives each month?
- Will I always work with the same team member?
- How do I get documents to and from your firm?
- How often can I expect to see financial reports?
- What does it cost to clean up my books if our company is behind?
- What are the costs if we have a specific accounting project we would like to tackle later on?
- Do you offer advisory services like CFO and tax?
- What do you know about my industry and business model?
- Can you provide a reference from a related company?
- What kind of approach do you take to debt?
- Will you be able to identify my key drivers of growth?
- What kind of systems or tools do you use to report on operations?
- If I have multiple entities can you provide consolidated reporting?
Related Read: To find more strategic financial insight from your outsourced accounting service then be sure to include some of the tips we’ve included on hiring the right CFO vs. controller.
How does outsourced accounting work?
What does the onboarding process look like for outsourced accounting services?
- Phase 1: Kickoff meeting
- Phase 2: Transition of weekly accounting and bookkeeping items
- Phase 3: Month-end accounting items (business knowledge share, monthly reporting and chart of accounts)
- Phase 4: Advanced services (key metrics and special projects)
We typically begin executing phase two by the end of the first week and the onboarding process is normally completed in five to six weeks.
If you need to clean up your books, we’ll take a look at the size of the project and provide and estimate on completion time along with cost.
How do ongoing outsourced accounting services work?
Once you have completed the onboarding process, and we have completed any clean-up to your books that you requested, we begin our ongoing accounting services. This typically involves weekly check-ins as required with an associate and monthly meetings for financial reporting of your income statement, balance sheet and statement of cash flows with both an associate and a manager. We pride ourselves on being a very proactive outsourced accounting service, so we typically find our newer clients surprised by how responsive we are. Have a question about your books? Contact your associate and we’ll be in touch within 24 hours.
Our responsibilities include:
- weekly bookkeeping tasks like accounts payable, accounts receivable and payroll
- monthly controller tasks like financial and investor reporting
- strategic insight if you opted into our outsourced CFO services
- answering your accounting-related questions
- looking after your books!
Your responsibilities include:
- providing us access to any of the company systems or tools you use
- showing up for the monthly meetings with any questions you may have
- running your business!
Hopefully by using this guide you can determine the right budget and find the best outsourced accounting service for your company. Get in touch to learn more about our outsourced accounting costs and how we can fit within your budget.