The decision to outsource a business task generally has two components. There is the financial (or business) part of the decision and the personal or emotional part of the decision. To help you determine if now is the time to outsource your accounting work, discover a few ways to quantify these two elements.

The Financial Aspects

When you outsource your bookkeeping and accounting, you generally know what it will cost your company. You might research the cost other similar businesses pay for bookkeeping or accounting staff. If you want to use an outside service, you would find out their rates per hour or per project.

The question you have to answer is whether this costs more or less than you already spend. So, how do you know what you pay to do the work yourself?

Start by assessing the various fees related to your accounting. This might include subscriptions for bookkeeping or payroll software, fees to a payroll service, tax preparation fees, accounting books or classes to learn needed skills, costs of equipment, and penalties or fines for errors you have made.

Then, value your own time. One method is to track the time you spend on everything related to your business as well as the time spent on its major components — such as sales, accounting, production, and administration. Divide your profit by the hours spent for a per-hour number. Another way to value your time is to figure the hourly rate you would spend to hire an employee to do each job.

Within the business portion of your decision would also be the question of whether your business needs you more urgently elsewhere. If sales are lacking, for instance, would you get a better rate of return by focusing on finding new customers rather than entering payable invoices into the computer or printing reminder notices?

The Personal Aspects

Few business decisions have no personal component. Whether the math favors or does not favor outsourcing, the question is how you feel about the work. When you think about having to do the books, how does it make you feel? And how do those feelings bleed over into your other work?

A few indicators can help you figure out where you stand on a personal level. For instance, do you put off working on your accounting each week? Have you fallen behind in daily, weekly, or monthly tasks? Or does the thought of doing the books stress you out?

On the other hand, perhaps you look forward to certain aspects, such as creating billings. Do you find the books to be a respite from other stressful jobs? Are you able to keep up with things like posting transactions as they occur? Do you open all related mail right away and handle it? And what about your accounting work style? A well-organized and tidy system could indicate that you do not mind this part of your job.

If you are unsure if now is the right time to delegate your accounting to someone else, start by learning more about your options. At Bliss & Skeen, CPAs, we can help you figure out the costs and benefits as well as determine what level of outsourcing might be right for your company’s needs. Learn more today by making an appointment.