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Accounting advisory services: Why outsource accounting?
The global finance and accounting outsourcing market will reach $53.4 billion by 2026, according to data published by ReportLinker.
Accounting outsourcing service is an important function in the general financial and accounting market. The importance of this process is increasing by companies, which pushes accounting firms to further strengthen their positions by improving their experience.
The global business process outsourcing market is expected to reach $525 billion by 2030 (Grandview Research), with the financial services, IT, and telecommunications industries being the biggest drivers of that growth. Entrusting the outsourcing of financial services and accounting advisory services to Profix Consulting specialists, you can guarantee the efficient organisation of financial activities.
What is accounting?
Accounting is one of the core functions of almost any business. It can be handled by an accountant or bookkeeper in a small firm, or finance departments with dozens of employees in larger companies. Reports generated by various accounting streams, such as cost accounting and management accounting, are irreplaceable in helping management make informed business decisions.
Accounting is the process of recording, analysing, and reporting financial transactions related to a business to supervisory, regulatory, and tax authorities. Financial statements used in accounting are brief summaries of financial transactions (a company's operations, financial position, and cash flows) during an accounting period.
Regardless of the size of the business, accounting is a necessary function for decision making, cost planning and economic performance measurement. So applying accounting advisory services could be revolutionary for your business.
Two important types of accounting for businesses are managerial accounting and financial accounting. Management accounting is designed to generalise information about production costs and product cost. Management accounting helps in making business decisions. Financial accounting is divided into balance sheet accounts and activity results accounting. Accounts reflecting the results of activity are the income and expenses of the organisation. Both types of information are important in making strategic decisions, so you need to choose the right accounting advisory services.
Why are accounting advisory services important?
Accounting advisory services play a key role in a company's strategic planning, growth and compliance requirements presenting a number of important factors. .
A guarantee of growth Accounting advisory services are key to a company's growth. Without insight into business performance, it is impossible for a company to make smart financial decisions through forecasting. Without accounting and management accounting, the company would not be able to accurately manage the product line by analysing profitable and unprofitable products. Source of funding Foreign investors want to be sure they know what they are investing in. Prior to private financing, investors typically require financial statements (often audited) to assess the overall health of the company. The same rules apply to debt financing. Banks and other lending institutions often require financial statements in accordance with accounting rules as part of the credit underwriting and review process. Usually, local entrepreneurs apply for accounting advisory services to make an investor pitch and financial deck in it. Financial picture Accounting advisory services reflect the results of business operations as well as the financial condition of a small business or corporation. In other words, it helps to understand and track expenses, gross margin and company liabilities by comparing current data with previous accounting records. Budgeting and forecasting Budgeting and future forecasting is one of the most important roles for successful business operations. They are based on sound financial data and aimed at achieving financial goals.
Information from accounting provides a detailed description of the financial health and stability of a business. Financial statements based on this information can drive a company's strategy in both the short and long term. Therefore, it is very important for businesses to conduct accounting with experienced professionals.
Advantages of accounting advisory services
Accounting advisory services can play an essential role in the success of any company, regardless of company size. Accounting provides business with practical information on all transactions in a timely manner. Without proper accounting information, a wrong decision will be made that will disrupt the entire business.
The 4 main advantages of accounting advisory services in making strategic decisions are listed below:
1. Systematic record system
Accounting is used to record business transactions in a complete and systematic way in the books of accounts, which will later be used in making strategic decisions.
Business owners rely on accounting information that they then present to investors and other stakeholders. Many businesses have their own internal controls in place with appropriate procedures and policies to make the numbers reliable. Errors are common in accounting, but with proper checks, errors are detected and corrected before financial information is published.
3. Effective management
Proper accounting of business transactions contributes to efficient management. It also helps the management to assess the performance of the business in terms of sales and take timely measures to overcome the deficiencies that are adversely affecting the business.
The most important advantage of accounting is that it processes very complex data, but in an easy and understandable way. Accounting processes large amounts of data and presents them to top management in simple reports so that they can easily be understood for the necessary transactions.
Profix Consulting specialists will help you efficiently record, process, manage and present complex accounting information in an accessible way.
Why outsource accounting?
1. Cost effectiveness
Outsourcing your bookkeeping is usually less expensive than having your own staff. It saves you money and time by exempting you from payroll taxes, wages, insurance, benefits, vacation, and more.
2. Leading edge software
You can manage your basic financial problems with standard software, but modern software offers more possibilities.
3. Accounting staff
In the case of outsourcing, it is possible to hear a unified opinion, formed by experienced, knowledgeable professionals who operate in the field of finance and accounting. They can help you better understand finances, provide guidance, and handle difficult situations and problems.
4. Access to reliable data
Good financial data should be the basis of your business decisions. When you get access to powerful software while doing your accounting, you can collect the data you are interested in and create reports on it. Thus, you will have the opportunity to get answers to specific questions when outsourcing accounting.
5. Increasing control and reducing fraud
If most of the accounting functions of a business are in the hands of one or two people, the risk of fraud is high. Outsourcing your bookkeeping to a third party reduces this risk and allows for better internal controls.
Accounting outsourcing may seem like a complicated process, but the picture changes immediately in the case of choosing the right partner. Your business plans can become more strategic and efficient, and you can rest easy knowing that the path to success is based on financial accuracy and supported by the best professionals.