If you're considering in-house accounting vs outsourced business accounting, it most likely means your business has grown. In addition to increased revenues, growth also means increased financial requirements. And because you may not have the expertise, time, or willingness to manage your accounting, you may be considering whether to hire a full-time in-house accountant vs outsourcing to a qualified accounting firm. But before you make a decision, make sure you understand the real costs associated with hiring an in-house accountant. Read on to learn the five often-overlooked costs of hiring an in-house accountant.
In-House Accountants and Bookkeepers Are Expensive
One of the biggest costs associated with hiring an in-house accountant is employment costs. In 2019, accountants earned an average of $79,520. Hiring an in-house bookkeeper or clerk may save you a few dollars because their median salary was significantly lower in 2019 at $41,230. In addition to the hard money, you'll also need to consider the cost of employee benefits required to attract capable professionals. These employee benefits include health insurance, paid leave, retirement plan with match, workers compensation, and more.
You can avoid all of these costs entirely by outsourcing your accounting through an experienced accounting firm. Instead of paying salary and employee benefit costs, outsourced accounting will cost you anywhere from $5,000 to $14,000 annually based on the accounting services you need. With outsourced accounting, you pay for what you need and have much better control over the costs.
Consider the Time Costs Associated with Training an In-House Accountant
In business, time is money, and having to spend time training a new employee means you can't dedicate your efforts elsewhere. By choosing an in-house bookkeeper or accountant, you'll need to dedicate a significant amount of time and effort toward getting them up to speed. You will also need to supply a computer, office space, and other equipment. In the event your new hire doesn't think it's a good fit, you will have to repeat the entire process over again.
However, when you partner with an accounting firm, you'll immediately have access to teams of skilled CPAs at your disposal. Accounting firms specialize in being able to quickly onboard and hit the ground running. As soon as your bookkeeping is handed over, you can relax and allow the experts to handle the rest.
Finding the Right Candidate and Hiring Takes Time
You should also consider the amount of time it requires to post a job, sort through mounds of resumes, interview candidates, and make a decision. According to a LinkedIn survey, only 30% of organizations are able to fill a vacant role within 30 days. The remaining 70% of companies take anywhere from one to four months to process a new hire. A 2017 Talent Acquisition Benchmarking Report discovered the average time-to-fill a position was just over a month at 36 days.
Instead of going through this lengthy, time-consuming process, a growing number of savvy business owners are choosing to outsource their accounting. In doing so, you can start having your accounting done professionally in a matter of days in contrast to waiting four months to begin the hiring process.
Increased Exposure to Risk and Fraud
Simply put, an in-house accounting professional greatly increases your exposure to the risk of mistakes and fraud. It's far too easy for one individual to create fake expenses and pocket the money. Even if the incident isn't nefarious, it can still cost your business valuable resources. Unfortunately, the in-house accountant option fails to have the necessary checks and balances to protect your business from mistakes and fraud.
On the other hand, hiring a professional accounting firm can exponentially reduce your exposure to errors and fraud. In contrast to one accounting professional handling everything, you will have several eyes auditing your books and numbers. For example, at the MB Group, we have multiple accountants working on each client's account. This way, we are quick to spot any oversights or inconsistencies that may exist. We pride ourselves on being extremely meticulous in all we do because our reputation is based on our honesty, transparency, and integrity. Prior to anything being finalized, it must pass through a series of checks and quality control measures to ensure accuracy and exactness.
Lack of Contingency
What happens when your in-house accountant is sick or away from the office? What about vacations? All of these real scenarios can create a conundrum for your business. However, when you partner with a multi-employee accounting firm like the MB Group, you will enjoy seamless accounting solutions. You will have an entire team of CPAs dedicated to your business accounting, so we will never miss a beat or day.
Contact the MB Group for Expert Accounting Solutions
When it comes to your accounting, one-size-fits-all solutions rarely work. Because of this, we offer a full suite of tax planning, financial reporting, accounting, and consulting solutions that can be tailored to businesses of all sizes. Designed to scale, our services are exponentially more cost-effective than hiring an in-house accountant.
Contact the MB Group today to learn more about how we can help your business.