If you own a small business, interested in minimizing a portion of your payroll, considering outsourcing your current bookkeeper or accountant, and someone in your family is not working, outsourcing to family may be a viable alternative for you.
Outsourcing your accounting or bookkeeping functions may result in reduced payroll costs, or the conversion of fixed costs to variable costs, insurance, benefits and some tax savings, etc. However, before you start outsourcing, you will need to invest in a quality fax machine or scanner. The type of fax machine or scanner depends on the volume and frequency of documents(i.e. vendor bills,customer invoices bank statements, etc.) to be scanned and sent to your outsourced accountant. Scanning or faxing is necessary because all of the source documents have to be sent either by email or fax to the outsourced accountant to record the bookkeeping transactions.
As a business owner or the person responsible for the financial department, you must also make sure there is a process in place to monitor the activities of the outsourcing company. An important consideration is that outsourcing may make sense, as long as a competent and independent person oversees and monitors the financial results on behalf of the small business owner.
We often read that that if you outsource, some of your business accounting functions to a foreign country, then your labor costs will decrease as compared to what you would generally pay in the United States. In these uncertain times, when small business owners are facing survival issues resulting from lost sales, skyrocketing costs, contraction, often exacerbated by family unemployment, then it may make sense to give thought to employing a family member to help with the small business accounting. By employing a family member in your house or outsourcing your accounting function with family in a distant location, rather than outsourcing to another country, you may actually help the U.S. economy, in your own way, by keeping jobs in this country. A baby step,but certainly the right one for our country. This idea works, if the owners or members of the owner's family can learn QuickBooks, or another comparable online accounting software program. It's helpful, if the family member has some basic financial knowledge to undertake this responsibility of entering the financial information into an online accounting software. Given the current economy in the United States, there are situations where family members are now unemployed and are now ready, able and available to help and make a positive contribution to the family business.
QuickBooks Online Plus is one of many online accounting softwares available and easy to learn. With training, most people with common sense can handle QuickBooks. If you decide to chose this option, it's important to have a CPA or accountant available to ask questions and to receive timely answers, as well as a mechanism in place to allow for real time or after the fact corrections or adjustments to the accounting records.
Under either alternative, outsourcing to a foreign country or outsourcing with a family member, an accountant or CPA is the ideal person to monitor either in real time, or after the fact i.e. monthly or quarterly financial information, and to check that the reconciliation process is working and more importantly,that outsource team or family member,are doing their job.
It is important to monitor an outsourced accounting department, whether the outsourced department is in a distant location or outsourced to family. By using QuickBooks Online or other QuickBooks versions with remote access, it is possible to have a CPA or an accountant remotely perform this monitoring function.
If you decide to outsource, then you should speak to your CPA or accountant in order to ascertain if whether or not outsourcing is appropriate for your particular small business accounting situation. The CPA or accountant is best suited in helping you evaluate the potential skill set of the person to provide the outsourced service.
This concept of outsourcing to one or two family members may not work for a large or mid size business. However, if you own a small business, interested in effectively reducing a portion of your payroll costs, have decided or thinking about outsourcing your current bookkeeper, and someone in your family is unemployed, outsourcing may be right for you. Once again, this will work as long as the outsourced family member is properly supervised and monitored by a CPA or accountant. In the beginning there may be more time required by your CPA or accountant to train and to oversee as compared to time that your accounting professional currently spends each month or quarter. In the long run, the amount of time required by your accounting professional should diminish. Notwithstanding, some time will always be required of your accounting professional to monitor the activities of the outsourced person. - 26221
Outsourcing your accounting or bookkeeping functions may result in reduced payroll costs, or the conversion of fixed costs to variable costs, insurance, benefits and some tax savings, etc. However, before you start outsourcing, you will need to invest in a quality fax machine or scanner. The type of fax machine or scanner depends on the volume and frequency of documents(i.e. vendor bills,customer invoices bank statements, etc.) to be scanned and sent to your outsourced accountant. Scanning or faxing is necessary because all of the source documents have to be sent either by email or fax to the outsourced accountant to record the bookkeeping transactions.
As a business owner or the person responsible for the financial department, you must also make sure there is a process in place to monitor the activities of the outsourcing company. An important consideration is that outsourcing may make sense, as long as a competent and independent person oversees and monitors the financial results on behalf of the small business owner.
We often read that that if you outsource, some of your business accounting functions to a foreign country, then your labor costs will decrease as compared to what you would generally pay in the United States. In these uncertain times, when small business owners are facing survival issues resulting from lost sales, skyrocketing costs, contraction, often exacerbated by family unemployment, then it may make sense to give thought to employing a family member to help with the small business accounting. By employing a family member in your house or outsourcing your accounting function with family in a distant location, rather than outsourcing to another country, you may actually help the U.S. economy, in your own way, by keeping jobs in this country. A baby step,but certainly the right one for our country. This idea works, if the owners or members of the owner's family can learn QuickBooks, or another comparable online accounting software program. It's helpful, if the family member has some basic financial knowledge to undertake this responsibility of entering the financial information into an online accounting software. Given the current economy in the United States, there are situations where family members are now unemployed and are now ready, able and available to help and make a positive contribution to the family business.
QuickBooks Online Plus is one of many online accounting softwares available and easy to learn. With training, most people with common sense can handle QuickBooks. If you decide to chose this option, it's important to have a CPA or accountant available to ask questions and to receive timely answers, as well as a mechanism in place to allow for real time or after the fact corrections or adjustments to the accounting records.
Under either alternative, outsourcing to a foreign country or outsourcing with a family member, an accountant or CPA is the ideal person to monitor either in real time, or after the fact i.e. monthly or quarterly financial information, and to check that the reconciliation process is working and more importantly,that outsource team or family member,are doing their job.
It is important to monitor an outsourced accounting department, whether the outsourced department is in a distant location or outsourced to family. By using QuickBooks Online or other QuickBooks versions with remote access, it is possible to have a CPA or an accountant remotely perform this monitoring function.
If you decide to outsource, then you should speak to your CPA or accountant in order to ascertain if whether or not outsourcing is appropriate for your particular small business accounting situation. The CPA or accountant is best suited in helping you evaluate the potential skill set of the person to provide the outsourced service.
This concept of outsourcing to one or two family members may not work for a large or mid size business. However, if you own a small business, interested in effectively reducing a portion of your payroll costs, have decided or thinking about outsourcing your current bookkeeper, and someone in your family is unemployed, outsourcing may be right for you. Once again, this will work as long as the outsourced family member is properly supervised and monitored by a CPA or accountant. In the beginning there may be more time required by your CPA or accountant to train and to oversee as compared to time that your accounting professional currently spends each month or quarter. In the long run, the amount of time required by your accounting professional should diminish. Notwithstanding, some time will always be required of your accounting professional to monitor the activities of the outsourced person. - 26221
About the Author:
Sandor Lenner,C.P.A. has been providing accounting services for companies for 35 years. He is also a Certified QuickBooks ProAdvisor and provides QuickBooks support and works as a part-time consultant with Susan Missal Lenner, P.A. . Subscribe to our free monthly newsletter on timely accounting, tax and small business topics. We will not share your email address with anyone.
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