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Costs of Outsourcing Controller Services for Small Businesses

Posted by Stephen King
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Think about your company for a second. It’s thriving and revenue is coming in, but amongst all the growth, there are questions about your future. You find yourself wondering what to do about financial decisions like are you pricing your jobs right. Is it time to hire more staff?

You have the cash flow but should you spend the money? When is it the right time? Which clients and services are the most profitable? Which teams should get more people? What marketing spend will provide the most ROI and drive growth?

There are a lot of tough questions to answer. Successful businesses need to see beyond just selling more business and hiring additional employees. 

Download The One Page Scorecard  How to Use 6 KPI Charts to Drive ProfitabilityBefore you make big decisions, are you receiving meaningful, timely and accurate financials about your business? If not, you are probably wondering whether the foundation is already get to the next level by being set to make smart business decisions.

Your business might have a person with the title of controller who’s in charge of creating reports and analyzing data that helps guide the business through critical changes. If they are a true controller, they review information that a bookkeeper or accountant provides to predict future information for a business or company.

If you don’t have a controller, or the person with that title isn’t providing you with the relevant information you need to make data driven decisions, outsourcing controller services might be a smart move for your business. By outsourcing your controller services, you could gain much higher levels of reporting and analysis.

Outsourced Controller Services vs. Traditional Controllers  

A traditional Controller is different from what an outsourced controller services offer your business. Either way, a true controller is a degreed accountant who manages accountants and bookkeepers on their team. For a small company where a full charge bookkeeper is the sole member of the accounting team, managing data entry, account reconciliation, and providing reports to their CFO or CEO, there’s also a material weakness in internal controls. One person should not pay the bills and reconcile the bank account.

Outsourcing your controller services allows a company to pick and choose services that a controller would provide. It’s important to distinguish between the CFO and Controller function. The CFO looks forward, the controller looks back.   But a good team works together to use the history to predict the future.

Sometimes the business has needs that require someone to be in-house who knows everything from the ground up. Then you need to find a flexible outsourced provided to complement your in-house staff. You don’t need to outsource everything. However, outsourcing allows for increased accounting expertise in areas such as job costing, month-end accruals, revenue recognition and more.

Why Your Business Should Outsource Controller Services

The four primary reasons companies are choosing to switch to outsourced controller services are confidentiality, turnover rate, single-point-of-failure, and cost. Outsourcing controller services can help consolidate tasks, increase efficiency and produce more accurate results for your business.

1.     Outsourced Controller Services Allows for Confidentiality

Most small business experience is a lack of separation between departments. When employees work close to the accounting department, confidential information has the capability to get in the wrong hands. If this happens, information could get shared that is detrimental to an employee or the business.

Avoid the potential risk and liability of data sharing by outsourcing your controller services. 

2.     Control Turnover Rate by Outsourcing Controller Services

Many companies have regular turnover in the bookkeeping, accounting or controller positions. Why? It's not a core competency of the management team.  The time and money that goes into finding and training someone to fill a position really adds up if you are filling a position every two years. By outsourcing, you eliminate the hassle of posting the job, interviewing, and training a new employee.

Outsourcing controller services allows you to focus on making money because you have someone you can rely on day in and day out. You can trust the results they produce and have comfort knowing you always have access to financial intelligence.

3.     Outsourcing Controller Services Stops Single-Point-of-Failure

A single point of failure is when one person is in charge of a function or process, and when they aren’t there, the duties don’t get accomplished. And when the bookkeeping isn’t completed, billing doesn’t get done and cash flow suffers.

If your accountant or controller goes on vacation for two weeks, who will complete their work when they are gone? If they were to quit, is there a system in place for someone to pick up where they left off? By outsourcing your company’s controller services, there’s no risk involved. It all just happens.

Controller services go beyond just bookkeeping and accounting, they provide critical oversight and account management ensuring the right policies and procedures get implemented and timely accurate financials are produced. A good accounting system with a good controller should help you make more money.

4.     Outsourcing Controller Services Cost Less Than a Full-Time Controller

Employing a controller is expensive. Small to medium businesses will pay $75,000-$100,000 for a controller. A corporate company can pay upwards of $150,000 a year for their controller. If you have an in-house controller providing the desired results for your company, then you might not need to make any changes by outsourcing their duties. Just make sure it makes financial sense, and you have the right person in that seat.

However, make sure you aren't paying your full time controller for part time controller work. You don’t want to pay a controller salary to do the bookkeeping, accounting, and controller duties. You will end up paying too much for the routine jobs they are performing.   

If your company doesn’t have enough work for a full time controller, outsourcing can be a solution. Outsourcing allows for as much or little work to get accomplished per your company needs.

Outsourcing controller services fees typically start at $2,000-$3,500 per month. The oversight provided and the improved reporting package delivered will usually be well worth the price. Fees are dependent on the needs and size of your business. At the end of the day, outsourcing will be cheaper than a full charge in-house controller for most businesses.      

GrowthForce is well equipped to serve as your outsourced controller service department. We provide outstanding client service with a U.S. based team of a bookkeeper, staff accountant and accounting manager who provide the expertise you need to run your business. Put your numbers to work! 

Get a Quote for Outsourced Accounting Services