Outsourcing non-essential business tasks to third-party service providers is a well-established strategy. Functions like payroll, human resources and IT have long been outsourced to enhance efficiency and focus on core business areas.
Recently, more businesses have recognized the advantages of outsourcing their finance and accounting functions. This shift offers numerous benefits, positioning finance and accounting alongside IT as the most outsourced business tasks. In fact, 37% of businesses that outsource report contracting out these functions to third-party providers.
Enhanced Strategic Planning
In today’s competitive landscape, finance executives are increasingly expected to play a central role in strategic planning. Outsourcing finance and accounting allows these executives to focus on high-impact tasks that drive strategic value, rather than getting bogged down in routine operations.
In a survey conducted by Bain & Company, 41% of CFOs said they’d like to spend more time on strategic planning and budgeting. Unfortunately, day-to-day finance tasks often consume their time, limiting their ability to contribute to a company’s broader vision. By outsourcing these functions, finance executives can concentrate on steering the company’s strategic direction.
Heightened economic uncertainty could make this an especially good time to consider outsourcing finance and accounting. Many companies turn to outsourcing during times like these to gain greater leverage, flexibility and cost savings. An outsourced finance and accounting expert could bring hands-on knowledge and experience from working with similar businesses that could help your company weather an economic storm.
Benefits of Outsourcing Finance and Accounting
In addition to freeing up time for strategic initiatives, outsourcing finance and accounting can yield several other key benefits for your company:
- Cost savings: By outsourcing, you may reduce the size of your in-house finance department, cutting costs related to hiring, training, salaries, benefits, office space and technology.
- Scalability: Outsourced services are easily scalable, allowing you to adjust as your business needs evolve, without the challenges of hiring or downsizing staff.
- Improved operational efficiency: Third-party providers often offer advanced reporting and analysis tools, delivering real-time insights that can enhance efficiency and profitability.
- Access to high-level financial expertise: Outsourcing gives you access to top-tier professionals on an as-needed basis, which might otherwise be cost-prohibitive.
- Lower fraud risk: Outsourced providers help establish strong internal controls and ensure a clear separation of accounting duties, reducing the risk of fraud.
- Better access to financial data: Leading-edge cloud technology from third-party providers enables real-time access to your financial data, improving visibility and ensuring timely financial closeouts.
Conclusion
Outsourcing your finance and accounting functions can offer a range of benefits, from cost savings and scalability to improved efficiency and reduced fraud risk. By leveraging the expertise and tools provided by third-party service providers, your company can gain a strategic advantage in a competitive market.
Discover how FD’s Outsourced Accounting Services can help propel your business toward its goals. To learn more, visit our website here or contact our expert below.
Courtney Mishoe, Tax Principal | courtney.mishoe@frazierdeeter.com