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 company's accounting functions may result in reduced labor costs or the conversion of fixed costs to variable costs, insurance,benefits and some tax savings, etc. Before you begin outsourcing, you need to invest in a quality scanner or fax machine and maybe even a high volume scanner or fax machine,depending on the volume and frequency of documents to be scanned. Scanning or faxing is necessary because all of the source documents(i.e. bank statements,vendor bills,customer invoices, etc.) have to be sent either by email or fax to the outsourced accountant to record your company's accounting 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 programs that is easy to learn and with some training, most people with common sense can handle. If you decide to chose this route, it's important to have a CPA or accountant is available to ask questions 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 option, outsourcing to a foreign country or to 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 the outsource team or family member,are doing their job.
With the correct QuickBooks Online or other QuickBooks versions with remote access, it is possible for your CPA or accountant to remotely monitor an outsourced accounting department, whether the outsourced department is in a distant location or outsourced to family.
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.
Outsourcing to one or two family members will not work for a large or mid size business. But, if you own a small business, interested in minimizing a portion of your payroll, thinking about to outsource your current bookkeeper or accountant, and someone in your family is not working, outsourcing to family may very well be a viable alternative for you. This should work as long as the outsourced family member is supervised and checked by your CPA or accountant. In the beginning there will be more time required by your CPA or accountant to teach and to oversee as compared to the time that your accounting professional currently spends each month or quarter. Overtime, your accounting professional will spend less hours in monitoring. Notwithstanding, some time will always be required of your accounting professional to monitor the activities of the outsourced person.
Outsourcing your company's accounting functions may result in reduced labor costs or the conversion of fixed costs to variable costs, insurance,benefits and some tax savings, etc. Before you begin outsourcing, you need to invest in a quality scanner or fax machine and maybe even a high volume scanner or fax machine,depending on the volume and frequency of documents to be scanned. Scanning or faxing is necessary because all of the source documents(i.e. bank statements,vendor bills,customer invoices, etc.) have to be sent either by email or fax to the outsourced accountant to record your company's accounting 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 programs that is easy to learn and with some training, most people with common sense can handle. If you decide to chose this route, it's important to have a CPA or accountant is available to ask questions 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 option, outsourcing to a foreign country or to 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 the outsource team or family member,are doing their job.
With the correct QuickBooks Online or other QuickBooks versions with remote access, it is possible for your CPA or accountant to remotely monitor an outsourced accounting department, whether the outsourced department is in a distant location or outsourced to family.
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.
Outsourcing to one or two family members will not work for a large or mid size business. But, if you own a small business, interested in minimizing a portion of your payroll, thinking about to outsource your current bookkeeper or accountant, and someone in your family is not working, outsourcing to family may very well be a viable alternative for you. This should work as long as the outsourced family member is supervised and checked by your CPA or accountant. In the beginning there will be more time required by your CPA or accountant to teach and to oversee as compared to the time that your accounting professional currently spends each month or quarter. Overtime, your accounting professional will spend less hours in monitoring. Notwithstanding, some time will always be required of your accounting professional to monitor the activities of the outsourced person.
About the Author:
Sandor Lenner,C.P.A.-M.B.A has been providing accounting services for companies for 35 years. He is also a Certified QuickBooks ProAdvisor and offers QuickBooks support and works as a part-time consultant with Susan Missal Lenner, P.A. . Please 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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