Rise Consulting Group

When companies are starting out, they are often forced to make a difficult decision about where to spend their budget dollars. They know that keeping the books and monitoring finances are very important to their survival but can't spare more than one position, if that. They sometimes handle the challenge in one of the following ways. 

Option One – Hire an accounting clerk or bookkeeper to handle their day to day needs. This person may have a degree in accounting or not. Regardless, they may be perfectly fine for depositing checks, paying bills, doing payroll and even keeping the books and records in order. However, they may not have the experience necessary to provide management with the type of feedback that can really help them grow their business as well as possible. Lease or Buy equipment, anticipate cash flow needs, provide tax saving strategies, when to lease a new or larger facility. These analyses and decisions are best provided by someone with prior experience and training; a Controller or CFO level.  

Option Two – Make the first hire a more senior level person. Although this will likely cost quite a bit more initially, it does provide a level of experience and training that will allow the company to handle those higher-order decisions contemplated in the paragraph above. The problem is that the vast majority of the time, this person will also be handling the day to day accounting activities, including AP, AR and payroll. In this case, the company is "overpaying" for the bulk of its financial needs. 

In both of these scenarios, a larger more risky issue looms. When a company only has one person responsible for all of its accounting activities, it creates an environment at risk of both unintentional errors and intentional fraud. Having two sets of eyes and the appropriate segregation of duties, reduces the likelihood of costly mistakes and, even worse, fraudulent activities. 

By outsourcing some, or all, of your accounting needs, you are able to more efficiently allocate your budget dollars by only purchasing the services you need, from people qualified to provide them. If you need an accounting clerk 10 hours a week, a Controller 5 hours a week, and a CFO two days a month, that is just what you will receive, often at a lower cost than keeping a single accountant on staff full-time. Additionally, you have built in quality controls and appropriate oversight to mitigate errors, intentional or otherwise, AND are insulated from the risk of turnover and vacation time. Many small companies don't let their payroll clerk go on vacation for two weeks at a time....ever.