Outsourcing Your Accounting : What are the benefits for your SME?

Are you the owner of a small or medium enterprise (SME) that’s thinking of outsourcing your accounting and bookkeeping? Taking this step could allow you the time to focus more on your business’s core activities, and focus more on growing your output.

Owners of SMEs are often short on two things: time and resources. From inception, most owners of SMEs will wear many hats, including that of an accountant. The truth is, for your business to grow, you will likely need to outsource this function sooner rather than later.  In this article: we’ll answer the following questions

What is outsourced accounting and bookkeeping?

Outsourced accounting and bookkeeping is the process of bringing a third party expert in to manage your businesses financial records. 

These services can include, but are not limited to: payroll, tax, accounts payable and receivable, and bank reconciliation. 

To find out more about outsourced accounting, please read our summary article on the subject. 

When is an SME ready to outsource its accounting and bookkeeping?

Very few small business owners start their business because they love admin and back office tasks. But the reality of the early years of an operation is that it will take up a lot of your time. 

A 2021 survey by YouGov found that many business owners struggle with the reality of running a business. Two-fifths of respondents suggested that part of the reason they founded their own operation was to have ‘more flexible hours’. In reality, the same proportion of SME founders reported that running their own business was in fact more time consuming. 

A quarter of those surveyed said that managing company finances and accounting was their most time consuming task.

Many of these business owners will continue to soldier on with this task, with the misguided view that; a) they can cope with their workload, and b) they can’t afford the help.

Neither of these statements can be proven wholly true or false without intimate knowledge of the business; however a very simple rule of thumb applies. If you are spending more time on accounting and bookkeeping than you’d like, you should outsource it (we’ll come to the budget part later). 

What are the benefits of outsourced accounting and bookkeeping? 

At Pennyhills, we act as a strategic partner to our clients. Find out how outsourcing your accounting and bookkeeping to us can help you grow. Get in touch today.