If you run of a business of any kind, small, midsize or large, it is important that you keep accounting tasks in mind, even if accounting is not your speciality. According to Fox News, “If you’re going to stay in business any length of time, you’ll need to perform some accounting functions.” Whether it’s you or someone you hire, every successful business should have an accounting department, and if your business is struggling it may be time for you to consider whether or not your accounting department needs an upgrade. Consider these three levels of accounting assistance, and evaluate which level of help would be best for your business:
1) Part-time finance professional or external service
If you run a small business or are just starting out and lack the funds for a full-time accounting professional, then you may want to consider hiring a part-time professional or an outside service to manage your day-to-day accounting records. This person should set up and oversee the company’s accounting system through an accounting package such as Quickbooks. They should also serve as a bookkeeper by keeping a daily record of transactions and preparing checks and invoices. Other basic accounting functions any business should have which could be performed by a part-time associate are fraud protection and tax preparation. According to study from the University of Cincinnati, 64 percent of small businesses surveyed reported encountering employee theft. Therefore, it’s important to have someone periodically check for fraud in any business. You should also have an employee, whether this is same person performing the other accounting tasks or not, who is a tax expert and can help your business understand and prepare your taxes.
2) Full-time bookkeeper with part-time CFO
The next level of service, which would be good for midsize businesses to consider, is hiring a full-time bookkeeper and a part-time CFO (chief financial officer) to review the bookkeeper’s work and answer any additional questions. As your company grows, bookkeeping will become more and more time-consuming, so it would make sense for you to invest in a full-time person to handle most bookkeeping tasks and a part-time financial expert (CFO) to provide an additional level of service, working with the bookkeeper and the business owner on protecting the company’s assets and assisting with tax and treasury tasks and financial planning and analysis.
3) Full-time CFO
The most expensive option, but also the also the most cost-effective for large businesses is to hire a full-time CFO to provide full-service accounting support. If you are paying as much for an external CFO as you would for a full-time employee or your part-time CFO is working overtime to keep up with the bookkeeping for your business, then it’s time to consider diverting more of your finances into your company’s accounting department.