Accounting and financial planning are two of the most important components of running a business. In this article, we will discuss some of the hottest finance and accounting outsourcing trends for 2019. With the proper accounting practices in place, your business can improve its cash flow and improve its bottom line.
Over the past decade or so, many businesses have decided to look beyond their walls and outsource these functions to the experts. Even if your business is relatively simple or only has a single employee, committing yourself to improve these essential functions can have a tremendous impact.
By understanding where the industry is moving, you will be able to decide if outsourcing is the right decision for your business. In the next section, we will identify the top 8 finance and accounting outsource trends for 2019. Let’s get started.
1. Wider Selection of Firms to Choose From
When the outsourcing industry was just getting off the ground, many businesses would hire an accountant (functioning as a sort of freelancer) and have that accountant come into their office on a regular basis. However, as technology improves, it is now common for new businesses and their accountant to never actually meet in person. By being able to have access to firms all across the country (and even the world!), it has become much easier for businesses to discover an accounting partner that effectively meets their needs. Before making any final decisions, be sure to do plenty of research and explore your options.
2. Personalized Service Packages
In the past, many firms offered a sort “all or nothing” approach to accounting, 2019 has already seen a significant shift towards customization. By being able to choose which services you need a la carte—and also identify the services you don’t need—you can maximize the value of your accounting team while avoiding overpayment. While some firms simply need an accountant to help them with their taxes once per year, others will look for more comprehensive service packages, offering things such as inventory analysis and long-term financial forecasting. In the modern era, both types of businesses can find exactly what they’re looking for.
3. Real Time Bookkeeping
As the accounting industry continues its steady movement into the digital space, it has become much easier to keep both books and financial reports entirely up to date. This is especially true for e-commerce accountants. With fully integrated accounting platforms at their disposal, your accountant can help set your books so they are updated every time a transaction takes place. This way, your business will always be able to know its financial position and can make decisions using the most readily available information.
4. Better Approaches to Taxes
Over the past few years, the tax system in the United States has experienced several major reforms. For example, the introduction of the Qualified Business Income (QBI) deduction has helped some sole proprietorships, partnerships, and S Corporations reduce their annual tax obligation by as much as 20 percent. With an increasing number of tax deductions and credits available, it will be crucial to find a partner who can help you potentially save money. As more reforms continue to take place, doing taxes will become a significantly more active process. Unless you are familiar with these new tax laws on your own, it may be worth getting some outside help.
5. Advanced Financial Modeling
New technology has also made it possible for accountant and financial planners to create more accurate financial models than ever before. Financial modeling is incredibly important—without an accurate cash flow forecast, your business may run into future issues or surprises. By creating models with a wider array of inputs (some even account for the financial consequences of weather), you will be able to see the future more clearly and also plan accordingly. Many accounting firms use QuickBooks as their go-to software, but there are plenty of other options available as well.
6. Outsourcing of Complex Functions
As the outsourced accounting industry has continued to demonstrate its value to businesses, it has gradually begun to secure their trust. In response, many firms are now more willing to outsource more complex financial functions than they were in years past. For example, firms that previously only outsourced their bookkeeping needs are now looking to their partners for help creating cash flow models, IRR forecasts, project valuations, and various other financial functions. Learn more about the difference between accounting versus bookkeeping here.
7. Retroactive Bookkeeping
The term retroactive bookkeeping does not imply that you are making changes to your books or fudging any of the numbers. Rather, retroactive bookkeeping is a process that involves organizing years of financial and accounting information into a single, centralized location. This makes it much easier for businesses to benchmark their performance and identify where they’ve been improving and where they need more work. If your business has books that are solely recorded on paper, bringing your books into the 21st Century will be even more necessary. Centralizing and organizing years of data might be a bit tedious at first, once this task is complete, your business will find itself in a much better financial position.
8. Improved Communication Channels
One of the reasons why the market for outsourced accountants has been able to grow at such a remarkable pace is that the communication channels available have significantly improved. For example, the proliferation of cloud technology has made it much easier for accountants and CPAs to collectively work on their books and other projects from remote locations. The introduction of various forms of video chat and shared accounting software have also been major game-changers. As time goes on, these technologies will continue to improve. In this article, we will discuss some of the hottest finance and accounting outsourcing trends for 2019.
Conclusion – Finance and Accounting Trends for 2019
If your business has not yet looked into hiring outsourced accountants, 2019 may be the year for you to make the change. The benefits of outsourced accounting and financial planning are obvious—between the access to expert advice, special programs, and confidence that your books are being managed correctly, you will get your money’s worth over time.