Most people who have been appointed to work in an office have come across at some accounting. They are the people who pay and send out the bills that support the company operation. They do a lot more than that, though. Sometimes referred to as "bean counters" they in addition keep their eye on gains, costs and losses. Unless you are running your own business and acting as your own accountant, you would have no way of knowing just how profitable - or not - your business is without some form of accounting.
Accounting covers many aspects, even if your task is to balance a checkbook, that is still accounting. It is part of even a kid's life. Saving a payment, consuming it all at once - these are accounting principles.
Most businesses, if not all, have a well defined accounting procedure and for some, account is a critical part of the business. For example, farmers need to carry out prudent accounting procedures. Many of them manage their farms year to year by taking loans to plant the crops. If it is a good year, a profitable one, then they can pay off their loan; if not, they might have to carry the loan over, and accrue more interest charges.
An important aspect of accounting for owners and executives of a business, is to manage the shifts in assets and liabilities. It is the responsibilities of the owners and managers to keep track of such changes. Making a profit in a business involves a number of factors, not just increasing the amount of cash that flows through a company, but management of other assets as well.
We have some sort of accounting system in our ordinary lives,, not just businesses, although we may not call it accounting per say. Without accounting, peoples' finances can get away from them where they do not know what they have spent, or whether they can anticipate a gain or a loss from their business. Staying on top of accounting, whether it is for a multi-billion dollar business or for a personal checking account is a certain activity on a regular basis if you are smart. Not doing so can mean anything from a bounced check or posting an end to a company's shareholder. Both schemes can be equally devastating.
In summary, accounting can be regarded as information, which is published periodically in business as a profit and loss statement, or an income statement
"Firstly, I can never stress the importance of getting someone who is a qualified accountant (CPA). A typical book keeper who is not qualified will only do more harm to your accounts. Therefore, always ask for your accountants"
Ms Hsieh, business owner and employer
Now, back to the merits of outsourcing:
1. Lower staff costs I have lowered my expenses by not having to pay costs associated to a full time employee i.e. CPF, annual leave, office space, medical costs, insurance etc. Basically, it could amount to a savings of almost 30% of personnel costs if I had employed a full time accountant! I believe the savings could be easily more than 30% these days with the spiraling costs of office space and inflation.
2. No headaches of finding a replacement staff Recruitment is a costly process. In addition, one needs to train up a new staff. This further increases the time costs needed to retrain someone new.
3. Just focus on business development now I have seen my business grow significantly without worrying that my accountant may leave me some day. My focus is now truely on growing the sales for the company and meeting up with clients.
4. Get a qualified CPA, not a mere book keeper A CPA will only enhance the value of your business by providing quality financial statements and value-added advice. CPAs are qualified and therefore, are quicker to understand your business.
Qualified CPAs need not be found only at the Big 4 accounting firms. We are here to serve all your accounting needs.
Joanne Hsieh has sinced written about articles on various topics from Accounting Guide. Looking to outsource your accounting and book keeping services? Call us at (65) 9271-7739, email outsource@maplecommerce.com or visit