In Pursuit of Profit
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However, you can’t guarantee that the process will go this well. Sure, you can communicate that you expect employees to bring this kind of tact to the transition, but you cannot control their timing or actions during the process (and sometimes neither can they depending on the circumstances involved!). Instead, you need to have a formal succession plan in place to safeguard the business against the kind of disruption that can happen when an accountant leaves unexpectedly.
The time to get ready is now!
Plan for your accountant’s departure before you need to do it so you can be properly prepared.
From our experience, clients seem to believe one of these perspectives wholeheartedly – there’s very little in between. And yet, neither is entirely right.
On the one hand, if you never hear from your accountant, that’s a troubling sign because you can’t be sure what they’re even doing on behalf of your organization. This kind of communication gap removes accountability, creating the opportunity for underperformance, mistakes, and even fraud to occur. However, hearing from your accountant constantly means they are spending their time talking to you instead of doing the work you have hired them to do, which is problematic (not to mention wasteful). Neither is a desirable scenario!
The role you need depends on your business needs, so let’s look at common business triggers that most likely require needing the next level of financial role, and what kind of activities and responsibilities each role typically includes. We’ll start with bookkeeper and work our way up to Chief Financial Officer (CFO).
No matter what the specific scenario is, they always come to us with the same two pain points: cost and fear of making a mistake.
Every decision-maker we talk to is juggling concerns around price (“How much will accounting services cost?” and “Is there room in the budget for outsourced accounting?”) and purchase anxiety (“How do I know what to look for in an accounting company?” and “What if I chose the wrong accounting provider?”) Unfortunately, sometimes we see these concerns derail the research process and the organization chooses to take the “I’ll do nothing for now” approach. Trust us when we say that is never the right solution! If you were at the point of looking for outsourced accounting and bookkeeping services, there was a reason why and that reason will not simply disappear because you feel overwhelmed by your options.
If your team is stretched too thin to keep up, does not have the experience needed to do a good job, or has a new situation that they need help with (like an expansion or audit), you need to get someone in to help right away. So, let’s discuss what you should be on the lookout for and how to know when you find it:
These figures should be a real wake up call for accounting managers and their employers, especially at a time when the pipeline of students pursuing accounting degrees is drying up as well.
If accounting does not change as a profession soon, we may continue to see the numbers of accountants dwindle. The accounting pool keeps getting smaller and smaller. So, what’s next? Could it be extinction?
Only time will tell if/when a recession will occur. Right now, business owners are collectively holding their breath as they wait to see how the economy will progress over the course of the next year, which begs the question: “What should your business be doing during this waiting period?”
Knowing what you will do during an economic downturn is an important part of any risk management strategy, especially when economists are warning that the nation may be headed for a recession in the near future.
What is your recourse if you cannot remedy performance issues? How do you set up future hires or service providers for success to avoid these kinds of issues in the future?
We’ll cover these topics in our guide to accounting management:
What would happen to your business if your accountant unexpectedly quit or was hit by the proverbial bus? How easily can someone else step in to keep the books in order?
I didn’t completely embarrass myself among the fresh-faced CPAs just out of college representing their public firm teams. However, I definitely regretted my decision to play after a bad midcourt collision left me looking at a wrist that was definitely not in the right position. After a long ER visit and eventual surgery to add some new hardware, the recovery process began.
I still do some part-time accounting consulting work for small businesses and being able to type is a key part of getting the job done. Having a wrist that wasn’t working, along with the pain involved, really cut into my ability to be productive. Some of the work I was doing couldn’t easily be handed off, so I had to do my best to continue getting work done despite my limitations.
In some cases, holding onto the role internally means hiring an in-house accountant, but at many small businesses, the alternative is simply tasking other employees with these kinds of functions. And, to no one’s surprise, the lucky person who gets the accounting work added to their to-do list tends to be the business owner.
While outsourcing overseas used to just be a cost-saving measure, many accounting firms are now facing labor shortages that are forcing them to take this step out of necessity, not of their own choosing. The Washington Post declared that “The remote revolution could lead to offshoring Armageddon” and though that is likely an exaggeration, it demonstrates how desperate many employers are these days to find personnel to do the work that needs to get done.
CPA firms, large employers, and companies with complicated ongoing financial needs are in a pinch. They need skilled employees to do the work that keeps their businesses running but with a dearth of qualified candidates available, their options are limited. However, offshoring is not the only solution! It is often a far better option to upskill your existing employees to assist with this work than to send it overseas.