Trusting someone with your business’ financial information can feel a bit daunting. But for so many business owners, trying to keep across all the little details in the numbers is pretty much impossible. This can mean things are missed, mistakes can be made and opportunities can go unnoticed. We totally understand why this is - not all business owners are best suited to financial forecasting, processing payroll or filing taxes. Ideally, you’d be able to spend your time on the things you’re most effective at, and harness the expertise of someone else on things that simply aren’t in your wheelhouse.

So if it’s decided that you’re needing help with accounting, bookkeeping and other financial matters, the next thing to decide is exactly how you’ll fill this gap: employ someone or engage an external provider? The answer isn’t always straightforward and sometimes it’s a combination of both. 

In this article we’ll suggest some things to think about before making a call on who and how your finances are managed. 

What’s the financial functions of your business?

The best thing to do before bringing anyone onboard is to figure out - what functions does my business actually need help with? While there are some universally applicable financial functions like bookkeeping and paying tax, some businesses will have payroll needs, others will need more attention on forecasting. It’s best to list out all the jobs that are currently being done by you or your team, and other needs that are being neglected. 

Once you’ve built a picture of these financial-related tasks, it’s helpful to estimate how much time these are taking (or refer to your reporting if the business is timesheeting). Understanding the current time-demands of these jobs can help plan for the cost of an employee to take care of it. However, don’t assume that just because it seems like a full time job, that you simply have to make a permanent hire. You could find that tasks done currently are much quicker in the hands of an expert. 

Benefits of having finances managed in house

There’s a few reasons why having in house employees on your business’ financials might be an option to consider:

Closer to the action
An in house accountant or bookkeeper will often hear about things as they come up throughout the workday, and be able to quickly adapt as needed (or react to issues in the moment).

Physical presence
If you’re a business owner that enjoys working closely with your team on a daily basis, physically sharing the workplace with your bookkeeper or financial controller can be an advantage.

Solely focused on your business
Hiring permanent employees into your business to manage financials will mean they’re only spending time on your business, and working with the rest of the team to hear about issues and make changes in the business’ processes as needed. 

Compliance and supervision
Onsite employees, especially for a sensitive area like finances, can give business owners peace of mind that they know what their staff are working on - and the systems they’re working with. 

Benefits to outsourcing financial functions

But even with some compelling reasons to explore hiring a finance team, outsourcing is growing in popularity across the country. At RightWay, we plug into our clients’ businesses and take care of their bookkeeping, accounting, forecasting and reporting, all while prioritising great working relationships. ‘Outsourcing’ as a term for some brings with it concern that there’s less visibility of what’s going on or a lack of personal touch - that’s simply not the way our team does things! Technically you’re outsourcing but we aim to operate like a natural extension of your business.

Some good reasons to consider outsourcing include:

Pay for what you need
By outsourcing just the tasks and functions that your business needs to someone like us, you’re not ever having to worry about utilising your teams’ expertise enough. We scale and tailor our services to suit. 

Gain from the learnings of others
The team working on your financials will likely have other RightWay clients. While we work extra hard to respect confidentiality and commercial sensitivity always, your business benefits from applicable learnings and solutions discovered elsewhere. This visibility simply isn’t possible with permanent employees. 

Reduce overheads
Anyone who’s employed a staff member knows that it’s more than just paying wages or salary in return for work. More people can impact the utilities costs, how much office space you need, equipment and more. By outsourcing your financial function, you completely sidestep the need for more desks and computers.

Save time on hiring and people management
Scaling isn’t easy and we know well just how much time and effort it can be to effectively vet, hire and manage people. Instead of sinking hours and days into this for your financial functions, you can tap into a proven, highly capable outsourced team where the hiring and quality control is already done.

Comparing costs

The cost of hiring and paying staff will vary depending on the level of the role(s) and it’s worth not forgetting those overhead costs, too. Generally though, it's cheaper for small businesses to outsource certain tasks to a provider. As with any business cost, doing your due diligence is always recommended - choosing the wrong provider could end up costing the business much more in mistakes and remedial work - not something anyone wants in their financials!

So there’s no one answer for everyone - it really depends on the type and scale of support you need. One of the cost-related benefits of outsourcing however is the flexibility of service - we’re able to expand or contract to meet our clients’ needs which is really valuable for scaling. 

Managing security and confidentiality

So what about the security of financial information? In today’s digital world, there are more measures around the storage and security of data compared to the days of the locked filing cabinet. On the other hand, digital-based information can always run into issues like cyber attacks. But the reality is that these risks exist no matter where your finance team is, particularly if you rely on cloud-based software and systems. 

Working with RightWay, your business’ information will be securely managed to best practices. We also understand that different businesses have certain policies around this stuff - something we’re happy to accommodate. We can’t speak for other outsourced solutions of course, so make sure you’re satisfied with the measures the provider takes to protect your commercial data. 

Future proofing for scale

Scaling is possible through in-house and outsourced solutions. But we believe strongly that outsourced financial services come with far fewer roadblocks and headaches. That doesn’t mean you should avoid scaling your team however. In fact, RightWay can help you strategically build up your internal capabilities in finances, evolving our support along the way. 

There’s plenty of decisions that go into scaling a business, so being able to remove the worries around having the financial expertise to support growth can really be worth it. Often periods of expansion or change can impact your staff attrition - this doesn’t become an issue with a good outsourced provider. 

Preparing to outsource your financials 

If you’re keen to make the move to outsourcing, there’s some handy hints to keep in mind:

• If you can, get your house in order - this goes for any external support be it accounting, virtual CFO or otherwise. It’s much easier to get all the benefits of outsourced expertise when you’re able to supply clear financial records and up to date information. Of course, if that’s part of your problem you need help with, that’s okay too!
  
  
• Articulate any important business processes - getting your finance team working well quickly is often down to their understanding of how your business operates.
  
  
• Put together a priority list - if you’ve got worries in certain areas of the business, make sure to write these down and talk about them with your new provider. Our team really benefits from staying in step with what business owners feel is the most important. Again, if you don’t have a clear picture of this, it’s not a worry - we can help analyse your financial information and processes and make recommendations of what needs to be done first. 
  
  
• Take the time to get clear on your business goals - this helps steer everything from target setting to making decisions around which expenses to incur. From our perspective, we know how much it helps to know what success looks like to you, the business owner. 

If you’re unsure of where to start with outsourcing financial tasks, reach out and we can help!

Outsourcing your accounting, bookkeeping and financial management to RightWay

RightWay helps New Zealand business owners to optimise their businesses. Our team are highly experienced accountants, bookkeepers and business advisors. Many of us have previously run successful businesses ourselves and we understand the challenges you can encounter. We allow our clients to focus on the things they want in their business, by taking care of some or all of their financial functions. 

While we are an ‘outsourcing’ solution, we place a big importance on people and relationships. Our team works closely with businesses each day to solve problems and find opportunities.

Learn more about our services on our website and get in touch with us today.