As an entrepreneur, our core business functions are where our passions lie. Our products and services are what we do well and we where we want to focus the majority of our time. But as a business owner, we know there are other essential factors that must be taken care of. Factors such as accounting and finance are areas you may not have much experience with, but are necessary to have a firm grasp upon to run a smooth business. A large trend today is to outsource those business functions that take us away from driving revenue and building the company. Here we explore 5 benefits of using outsourced accounting services to help you decide if investing money into an external CPA is the best move for your startup business.
Let’s pretend tax season is upon us. Time to gather that box of receipts you have stashed in some cold dark room labeled “bookkeeping” and begin the painstaking process of getting your books in order.
Hiring an outsourced accounting and bookkeeping service teaches good business habits from the start. CPAs will teach you why organization within your books is so important and how to stay organized. They will help you decide which files and documents are important to keep and report so when tax season comes around you won’t panic. Use accounting services to gain a better hold on your company’s stance financially, minimize potential theft from employees (God forbid), and how to mold your business around tax and money saving techniques.
Founder’s CPA offers outsourced CFO services to make sense of your finances. See how we can help here. Unless you are daddy’s little girl batting your eyelashes for some weekend spending cash, asking for money is hard, especially from banks or venture capitalists. You need to be organized and prepared when seeking investment capital and up-to-date bookkeeping records and financial statements could mean you getting the money, or going home empty handed.
Outsourced accounting services will portray your finely tuned business engine, attention to detail, and streamlined procedures. Your CPA will keep up-to-date bookkeeping records and interpretations of your financial statements to be read and analyzed by potential investors, making your small business look professional and capable. A startup business burns a lot of cash within its first few months to even years while trying to solidify a client base and build a reputation. It’s a chilling realization all entrepreneurs must come to terms with when starting a business. Your ‘burn rate’ tells you how long you will be able to stay in business at your current rate of spending. It’s an important figure to have considering the length of time it takes for most startups to start deriving considerable revenue. Outsourced Accounting Services calculate your ‘burn rate’ for a greater financial awareness, and in turn, will help you determine the amount of runway you have left before you become insolvent.
An experienced CPA is far more than a number cruncher and QuickBooks expert. Think of them more in terms of a data analyst, providing insight and advice to your startup’s financial well-being. In addition to bookkeeping, an outsourced accountant will provide financial statements, budgets & forecasts and help you make sense of data that may seem like a heap of random numbers to the untrained eye. A CPA will help you make insightful decisions based on this data to derive revenue and growth for your startup. Most good CPAs are also well versed in other areas of business, and should be able to provide general overall business advice to their clients.
Take a look at the various Consulting Services we offer here. Just because you run a small operation today doesn’t mean you won’t be tackling larger fronts in the coming years. An outsourced accounting service has the tools and resources to manage your finances at whichever level, tax bracket, size or locations your company holds. At the moment, a monthly accounting service may be all you need, but as you grow, finances get trickier and it is harder to bring an accounting service up to speed when you have a lot of moving parts. Outsourced accounting makes perfect sense when you have hours of accounting per week that would drain your personal time, but not quite enough hours to justify hiring and managing a full time employee. Starting with an accounting service in the early stages will ensure a quality relationship with professionals who can service your company at any stage. Written by Curt Mastio, CPA of Founder’s CPA
Visit our services page for more information on small business and startup accounting services here