For many organisations, their bookkeeper acts as a central point for their financial operations, regardless of whether they work inside the business, or are an outsourced supplier. This can take the form of the business’ bookkeeper having combined responsibility for specific bookkeeping tasks and crossover to operation duties.
Whilst this is a convenient way to operate it can increase risk as there is a lack of segregation of duties, plus it often causes inefficiencies. Inefficiencies can take place where the bookkeeper takes on responsibilities that should sit with other roles within the organisation which cause duplication and lack of understanding.
Segregation of duties can be difficult to achieve in SME’s, outsourcing is a way of achieving some segregation and therefore reducing opportunity for fraud and increasing the ability to prevent costly errors.
Below are some examples of key financial areas in a business that should be managed separately:
Before setting down the path of selecting a bookkeeper for your business, ask yourself the following questions:
If, like many business owners, you find that it is difficult to succinctly answer any one of the above questions, chances are that your organisation has a highly centralised practice of bookkeeping. Whilst at the best of times this may provide a sense of control, it can easily derail if the person in question is absent from the business for any length of time.
By having well-maintained books and processes, you will gain a clearer picture on your financial and operating position.
In addition, by having the added benefit of centralising your information into a cloud-based system means that you can access information on your business real-time, enabling you to make well-informed decision or pivot where necessary.
Relationships are also critical to good business practices. Having an outsourced bookkeeping team can enable you to streamline your accounts payable and receivable processes, minimising delays and keeping you in good standing with your customers and suppliers.
A robust, well-resourced bookkeeping team should be able to deliver 365-day year-round coverage to ensure that your business’ needs are always met. This means that your business should not be subject to staffing ebbs and flows, such as annual leave, sick leave and staffing changes.
With a seasoned bookkeeping team, you should benefit from being able to negotiate the scope of work and subsequent fees upfront. In a well-resourced bookkeeping partner, this means that your supplier can work on a fixed fee model that suits your business requirements
Your supplier should also be able to provide experienced and qualified staff in whom they invest training and ongoing development at their own expense. This means that you should no longer have to worry about bearing the ongoing internal costs of hiring, training and managing (and paying) bookkeeping staff because your provider will have it covered.
If you are going to outsource a function of your business, you will want to ensure that you have access to a talent pool of highly skilled bookkeeping professionals whose key focus is delivering accurate and timely results for your business.
The following should be queried when looking into a supplier:
The strength of your team working towards the common goal of your business is key. Regardless of whether you use outsourcing to complement your internal team, a well-established external bookkeeping team should act as an extension of your team. They should be able to provide tangible examples and referees that can attest to how they have helped alleviate time, divided focus and burden from the internal staff of other organisations
It is also critical that your operational bookkeeping translate seamlessly into the information that your accounting partner requires to meet your business’ compliance and reporting needs. Regardless of whether your accounting partner sits on the other side of the country, or next door to your bookkeeping partner, having your processes and information well-documented and organised into an accessible, multi-user, cloud-based environment means less time spent (and billed) sorting through the information
The nightmare of all business owners is the impact of a fatal hardware/ software/ server crash. With so many businesses storing key information on spreadsheets and on desktops, the vulnerability to an unforeseen computer crash is fodder for business nightmares. Informed, modern, outsourced bookkeeping teams help to alleviate these fears. Supported through a cloud-based environment, your day-to-day financial operations are run and backed up in the cloud. Goodbye local hardware, software (or personnel!) crashes!
Check that the credentials and listed partners of your bookkeeping team match your expectations of a supplier that is constantly evolving, staying on top of the changing technology and qualified to assist your business get the most out of the available tech and software. Is your provider a Xero Platinum Partner? Are they well-versed with MYOB and Quickbooks and other legacy systems? Without proven experience with a variety of systems, it might be questionable as to whether they will be equipped to ensure that your everyday bookkeeping information is accessible at the touch of a button.
An experienced bookkeeping supplier should be equipped to work with you in any number of ways – whether it be the full outsourcing of your accounts and bookkeeping functions, or taking care of a single component of the bookkeeping function; whatever suits your overall needs. And if your needs change, your bookkeeping partner should have the ability to scale accordingly and in a timely fashion.
Finally, no plan for success is complete without a roadmap to get there. Ensuring that your bookkeeping processes match your businesses’ needs are critical in enabling your operation to run as efficiently and effectively as possible. Experienced bookkeeping providers should be able to articulate how they would go about assessing, discussing, designing, and onboarding processes to (better) support your business, if needed.
A great bookkeeping team will ensure adherence to your approved processes, making sure that the right people are responsible for the right approvals and that the information they provide gets to the bookkeeping team in a fast and accurate manner. And the all-critical on-boarding process should allow for minimal to no downtime, so that your day-to-day operations are uninterrupted, and efficiencies felt from day one.