Header_Blue_Flame_2.png

Why is Outsourced Accounting so Affordable?

BY Eddy Hood In Outsourced Accounting Services On Jan 25, 2016 With 0 Comments

solitaire.jpgI like playing solitaire as much as the next guy, but in my humble opinion, it's one of the reasons that an in-house accountant is so dang expensive. 

Let's be honest, there are times when your company needs to get accounting tasks done, and there are times when nothing is happening.  The interesting thing about the world of accounting is that most tasks happen on a standard schedule.  

For example:  your accountant closes the books each month by the 5th, pays the vendors each week on Friday, and sends out invoices on the 20th. My question to you is this:  what is your in-house accountant doing in-between those scheduled tasks? He or she is on Facebook or playing solitaire, that's what.

The truth about outsourced accounting

Most full-time accountants are performing accounting tasks during 40-50% of their job.  The rest of their time is spent doing other activities, not all of them bad.  For example, they may be helping a production manager with something, serving on the company culture team, or working with the HR manager to get reports on staff.  The point is that they find a way to fill up the rest of their day with things that aren't as valuable.  It's also true that they manage to get in a few games of solitaire and some Facebook surfing.  

Outsourced accounting is so affordable because you're only paying for the actual accounting tasks to be performed; the 40-50% of time that it takes to get the work done. This means that you're hiring a professional to close the books, pay the vendors and invoice the customers. After that, they're done and your done paying for them. 

Excuses for not using outsourced accounting services

So many people tell me the same thing.  They say, "Yeah, but my accountant is getting important stuff done during the other 60% of the day." Really?  The HR manager can't pull her own reports? The production manager cant do his job on his own? Why on earth do they need the company accountant at their side to get their jobs done?  They don't . 

They second thing I hear a lot is that people like having an accountant down the hall that they can turn to when an emergency arises.  That's a fair point, and yes, it's nice to have someone down the hall.  However, when you need your accountants help in a quick pinch, don't you usually email him or her anyways? If you're using a good outsourced accounting service, can't you just call them or email them and they'll get it done? 

Let's do some quick math

MATH_NERDS.jpgThe average accountant makes around $60,000 a year. If my numbers are accurate, this means that 40% of their time is actually used to do accounting tasks for your company.  So, $60,000 x 40% = $24,000.  That means that you're paying the remaining $36,000 for them to wander the halls.  Is it really worth that much money to have someone in the office? What could you do with an extra $36,000 a year?  I can think of a few things I would do. 

Don't get me wrong. I love the in-house accountants of the world.  I come from that space myself.  They're doing good work and most of them care about their jobs.  However, I've seen time and again the in-house staff waste so much time just to fill an 8-hour day.  Do you really want to pay for all of that? 

What do you think? Go ahead and leave us a comment below. I would love to get your feedback.

Further Reading: 

4.5 Ways Outsourced Accounting Saves You Time

Go Paperless with Outsourced Accounting

 

New Call-to-action

My name is Eddy Hood. I've coached over 500 businesses on how to become more profitable. I'm the Founder & CEO of Ignite Spot, and I have mad parallel parking skills.

Leave a Comment About This Blog Post