In-house and outsourced services differ when managing the accounting activities for a given entity. Upon reviewing what fits best for a specific industry, or business model, wherever outsourced F&A is possible, the benefits are not comparable to in-house department. In addition to the benefits that depicted below, the biggest asset a company can benefit of; is flexibility while doing their business. Management will have more time devoted to modifying and managing their business model to generate more revenue, more value-added activities, and relief of compliance issues. Some benefits of outsourcing F&A are:
- Hiring cost is eliminated, focus on selecting the most suitable consultant to complete the business books and records.
- Training and retention of trained employees is not anymore a problem of the business.
- Data integrity and backups is another extremely important aspect when managing F&A, where the consultant will be liable for keeping records intact and accessible anytime by client or auditors.
- Outsourced bookkeeping and accounting services often provide higher quality and expertise. Employees of outsourced services are usually experts who undergo continual training in accounting and technology.
- Risk of fraud of in-house department is at rate dependent on inherent internal controls and systems used, however outsourced services are independent partner, working only for the benefit of the client, therefore risk of fraud might not exist.
- Axcell outsourced accounting is done by professional accountants, reviewed by seniors to ensure quality, in a case of in-house department, every employee has abundant of tasks to be finalized, therefore reviewing might not be done properly.
Most SMEs hire one or two accountants to manage company finances, The capability of both together is not equivalent to CFO services, accounting, and other services that business gain the benefits of having at deeply discounted fees. Businesses are charged only for the portion of time of those experts, therefore the payback on such investment outweighs the cost.
Axcell Outsourcing employs talented professionals who have more than 20 years in business. For a given business hiring such team, would cost a lot for SME. Axcell outsourced accounting help businesses take advantage of those professionals who are all located under one roof, and can help companies in all financial related matters. Starting by defining meaningful KPIs, developing reporting platform that helps users read and easily relate such reports to their business over time, that help in comparison and defining key actions for performance improvement. Axcell normally develops dashboard that is suitable for every level in an organization, CFO dashboard, as well as for CEO, so they can monitor their respective areas of responsibilities timely.
For many small and medium businesses, despite the value of outsourcing is incomparable, cost is a big determining factor when choosing accounting outsourcing services. A full-time in-house senior accountant annual salary is roughly EGP48,000 and a full-time chief accountant’s salary is EGP140,000. Together, “two employees cost over EGP188,000 annually”, which doesn’t take into account other overhead costs. Overhead costs mostly within 20% on top of an employee’s base salary that may include:
- Bonus, allowances, transportation
Medical/Benefits, other insurance costs.
- Retirement / severance payment.
- Vacation/Sick Days.
- Recruitment cost.
- Space occupied (% of rent).
- Depreciation of equipments (IT equipments, furniture, etc…).
Other costs related to software licenses might by significant depending on business needs, however we might consider a monthly fee around 10,000 that includes the license, maintenance, training, updates etc…
When calculating the above, an outsourced accounting by Axcell can be completed at higher quality yet saving 40% of the above total costs. In addition, data of the business is under full control, lowest risk, and incomparable confidentiality.
Which outsourced services suites your business?
Choosing the accounting service for your business depends on core needs, some businesses outsource the bookkeeping, only, and others outsource the whole function. Axcell can help transform such decision in order to enable businesses achieve set goals and work within the budget framework.
If you didn’t develop a budget beforehand, Axcell can do it for you as well!