(800) 931-6557
(800) 931-6557
ASP
  • Home
  • Accounting
    • FAQ
  • Recruiting
    • Recruiting Team
    • Recruiting Process
    • Recruiting FAQ
  • Openings
  • Oregon
  • Washington
  • Colorado
  • About
    • Clients
    • Testimonials
    • Diversity, Equity and Inclusion
    • Resources
    • Submit Resume
  • Contact
  • Payments
  • Blog
  • Home
  • Accounting
    • FAQ
  • Recruiting
    • Recruiting Team
    • Recruiting Process
    • Recruiting FAQ
  • Openings
  • Oregon
  • Washington
  • Colorado
  • About
    • Clients
    • Testimonials
    • Diversity, Equity and Inclusion
    • Resources
    • Submit Resume
  • Contact
  • Payments
  • Blog

​In Pursuit of Profit

Read our expert article below or sign up to get articles sent to your inbox.​

3/6/2023

Comments

Balancing Accounting Objectives and HR Goals

 
An article in the January-February edition of the Harvard Business Review titled “How Financial Accounting Screws Up HR” recently caught our attention. 
Balancing-Accounting-Objectives-and-HR-Goals
A scale balancing money and businesspeople.
The author, Peter Cappelli, a professor at the University of Pennsylvania’s Warton School of Business, highlighted the ways in which he believes that pursuing financial goals causes businesses distort their hiring and training objectives and deprive employees of the benefits they deserve. His summary for the article was as follows:
Many HR practices in the United States are bad for companies, employees, and shareholders. Firms skimp on training and development, for instance, and tightly limit head count even when they’re understaffed. They increasingly move work to nonemployees, like leased workers, and replace pensions with more-expensive 401(k) plans. They do such counterproductive things because U.S. financial reporting standards treat employees and investments in them as expenses or liabilities, which make companies look less valuable to investors.
​The solution he proposes is to change SEC reporting requirements, which would only help publicly traded companies, though he seems to indicate that these struggles are being felt by a broad array of business types and sizes.

​Unfortunately, it seems this article misses one very important point – the ways in which accounting and HR can work together to benefit the overall business. As a result, we’d like to cover that aspect of the discussion to help remind companies that their accountants are not the villains in the discussion of hiring and employee retention.
​As our partners at CFO Selections explain in an article on the areas where accounting and HR converge, “Companies that understand how finance and HR overlap and foster a relationship between the two are better poised for long-term growth than their less informed counterparts.”

So, let’s take a look at how to balance accounting objectives and HR goals to create sustainable business growth:

Accounting Objectives
Accounting manages the company’s money – that’s no secret. But what are their actual objectives in doing so? They are driven by achieving accuracy, improving efficiency, and maintaining timely reporting for stakeholders. Their goals are to ensure that there is sufficient cash flow to support business needs. Accounting manages one of the company’s most valuable assets – its money. In the same way that your heart pumps to keep blood flowing through your body and sustain life, accounting keeps tabs on what is going in and coming out and how that compares to what was expected to make sure that the business has what it needs when it needs it.

HR Goals
Human resources manages staff acquisition and development and oversee training and performance reviews. They plan and execute initiatives to keep employees engaged, increase job satisfaction, and encourage employee retention. They manage the other most valuable resource a company has – its people. They are like the soul of the company – the embodiment of what the company believes and how it demonstrates those principles. HR is willing to invest what is needed to ensure that the company is a place where people want to come to work to make or do something that attracts customers and achieves aspirational goals.

The Intersection
Thriving businesses need both. Enough money and the right staff are required for a company to do business successfully. Accounting and HR intersect in the areas of payroll, budgeting, benefits, business trend analysis, and financial audits. In these areas, strong communication between both teams is essential. Financial data helps shape strategic HR decisions (like determining how much raises should be for the year) and HR metrics contribute to accounting figures (like when employee records and compensation documentation are required for an IRS audit).

Our partners at CFO Selections explain the business benefit of accounting and HR working together in saying, “A convergence of accounting and HR allows a company to attain its short-term goals and long-term strategic vision by supporting employees as they grow.”

Finding Success
Balancing accounting objectives and HR goals requires strong collaboration between both teams. This relationship hinges on a mutual respect and an understanding of the role each plays in the organization’s success. Both teams must understand the other team’s goals, perspective, approach, and challenges to gain a deeper understanding of how they can benefit each other. Ultimately, each team should understand how they can work together and what kind of deliverables they will be sharing.

Additionally, they should both have access to the business owner or CEO to feel like they have an equal “seat at the table.” Otherwise, one team may mistakenly believe that they are less important to the company’s future success. Furthermore, their perspectives must be given equal weight when leadership needs to decide on issues that affect both teams.

Next Steps
When you need accounting help, turn to us for your outsourcing accounting needs. We have a team of highly experienced bookkeepers and accountants to help you achieve your financial objectives and facilitate meeting your greater business goals. Contact us today to find out more about how we can come alongside your existing personnel to partner in success.
Comments

    SUBSCRIBE:

    DOWNLOAD:

    The Ultimate New Business Formation Checklist

    DOWNLOAD:

    Accountant Evaluation

    Categories:

    All
    Accountant
    Accounting
    Accounting Systems
    Audit
    Bank Reconciliation
    Benefits
    Bookkeeper
    Bookkeeping
    Brand
    Budgeting
    Business Analysis
    Business Trends
    Cash Flow
    Change Management
    Checklist
    Closing The Books
    Colorado
    Community
    Contracts
    Controller
    Depreciation
    Ecommerce
    Economy
    Finance
    Fraud
    Government
    Hack
    Hiring
    HR
    Infographic
    Internal Controls
    IRS
    Laws
    Leadership
    Legal
    Local Economics
    Manuals
    Market Trends
    News
    Nonprofit
    Online Bookkeeping
    Oregon
    Outsource
    Payroll
    Payroll Taxes
    Planning
    Procedures
    QuickBooks
    Record Keeping
    Recruiting
    Recruiting Market Reports
    Remote Workforce
    Reporting
    Restaurants
    Risk
    Sales Tax
    Scam
    Security
    Small Business
    Social Media
    Software
    Startup
    Statistics
    Strategy
    Taxes
    Technology
    Time Management
    Washington State

    Archives:

    March 2023
    February 2023
    January 2023
    December 2022
    November 2022
    October 2022
    September 2022
    August 2022
    July 2022
    June 2022
    May 2022
    April 2022
    March 2022
    February 2022
    January 2022
    December 2021
    November 2021
    October 2021
    September 2021
    August 2021
    July 2021
    June 2021
    May 2021
    April 2021
    March 2021
    February 2021
    January 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019
    December 2018
    November 2018
    October 2018
    September 2018
    August 2018
    July 2018
    June 2018
    May 2018
    April 2018
    March 2018
    February 2018
    January 2018
    December 2017
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    June 2015
    February 2013
    October 2012
    November 2011
    May 2011



    RSS Feed

Services

Accounting Services
Recruiting Services

​

Company

About
Oregon Team
​Washington Team
Colorado Team
Clients


Support

Contact
CC
FAQ
​Resources
​Blog
​

ASP

Your resource for accounting & recruiting services. Serving Seattle, Bellevue, Redmond, Kirkland, Portland, Beaverton, Hillsboro, Lake Oswego, Denver, Lakewood, Aurora and more.
Contact us today for a free,
no-obligation consultation:
Toll Free (800) 931-6557
WA (425) 492-1901
OR (503) 473-0122
​CO
(720) 572-8211
info@asp-nw.com
© COPYRIGHT ASP - ALL RIGHTS RESERVED 
 A CFO Selections Company
Privacy Policy