Accounting is considered as one of the most vital parts of the company that plays a crucial role in its day to day working. The recent technological development has transformed the traditional accounting industry to a significant extent. With the latest tools and techniques, accounting industry offers irrefutable solutions for the smooth working of an organization.
To be successful in the corporate world, it is essential to identify the emerging accounting trends and adapt it timely to stay one step ahead of the competitors. Let’s have a look at the favourite accounting trends of 2018.
The technological advancements have changed the way companies prepare their payroll. Today companies have the option to choose the best-suited payroll technology for their organization. Unlike the traditional payroll system, the latest payroll technology offers more flexibility, efficiency, and accuracy. Companies can go for:
• Cloud-based payroll technology
• Mobile Payroll technology
• Integrated systems
By using cloud-based payroll technology, a company can reduce its cost effectively as there will be no need to spend a penny on an in-house method for preparing payroll. For its innumerable benefits, cloud-based payroll is gaining popularity in the corporate world. Read more about Payroll Services.
Cloud-based accounting is one of the top emerging trends in the accounting industry. It offers better alternative solutions for various in-house functions. Also, it helps in reducing expenses of the company efficiently.
The significant benefits of using cloud-based accounting are:
• Accounts can be accessed and edited from any device whether it is smartphone, laptop or tablet; just connect the device to the internet.
• Latest Accounting tools are just one click away.
• Data can be accessed from anywhere, thus location will not be an issue while working.
• Crucial accounting data of the company is completely secured from various online and offline threats.
• It is cost-effective since the company need not spend a penny in installing an in-house accounting infrastructure.
Every company has to maintain lots of valuable data for the purpose of audit and taxation. It is essential that data is stored safely and securely so that it can be referred when required. Also, loss of data can hinder the process of legal compliance which can attract the penalty for non-compliance.
The technological advancement has enabled the companies to store such valuable data more securely. Now, businesses prefer network drives instead of traditional ways for storing the crucial data. Network drives offer security and easy access anytime anywhere.
Outsourcing of accounting and financial services is one of the top accounting trends of 2018. The trend of accounts outsourcing is growing day by day. Its growing fame can be ascribed to various advantages of accounts outsourcing services, such as:
• Companies can reduce the expenses since there will be no need for setting up a separate accounts department.
• By using the accounts outsourcing services, the company gets access to the team of experts at very reasonable cost.
• By utilizing the benefits of outsourcing services, companies get enough time to focus on core business activities.
• The risk of fraud is minimized as the professionals handle the accounts at accounts outsourcing services.
Outsourcing services is a desirable option available today, but before choosing the outsourcing service, companies must verify the reputation of a firm offering the service. It is essential to check the experience and reliability of the firm to avoid any possibility of fraud.
Automation tools are becoming favorite day by day, and one of the main reasons for its growing fame is that it saves a significant amount of time which otherwise would have been charged as overtime by the employees. Since manual data entry is a time-consuming task and the risk of inaccuracy is quite high. Thus automation tool saves time, money and effort of the business. These tools are handy in generating complex financial reports in few minutes, therefore; companies now prefer to use automation tools.
Personalized & Customized services
The trend of using personalized and customized services is also becoming popular among corporates. Companies creating accounting software are now providing customized accounting software based on the needs of the client. Thus, companies need not spend money on the features of the software they don’t require.
When it comes to hiring CFO for your organization, the first question that comes to the mind is whether you should hire an In-House CFO or a Virtual CFO?
Certainly, it depends on the size and requirement of your business. Therefore, it is important to assess the need of your business first and then decide whether you want to opt for a Virtual CFO or an In-House CFO.
What is a Virtual CFO?
Virtual CFO is outsourcing the service that provides financial assistance to an organization. As compared to an In-House CFO, it is more economical and equally efficient. Therefore, by opting for Virtual CFO Services, you can avail the services of highly skilled financial experts to improve your cash flow and profitability without spending too much.
Let’s have a look at the best features of Virtual CFO that makes it more favourable than an In-House CFO.
Virtual CFO offers flexibility according to your business requirements. They have a vast experience of working with multifarious organizations in various industries. Therefore, they are able to handle complicated financial challenges more efficiently.
In case of an In-house CFO, the ability to cope with financial issues is restricted to the knowledge of an individual. Thus, if your organization encounters with any complex financial issue, it will be a challenging task to get through it.
Virtual CFO Solutions act as catalysts for speeding up the productivity of your business. When a new employee is hired, normally they will take 4 to 6 months for understanding and adaptingthe work environment of the company. The productivity of company is nearly stagnant during such period.
Since the experts at Virtual CFO Services have diverse experience in the field of accounts and finance. They are competent enough in providing best solutions in reasonable time; thus, improving the overall productivity of your business.
A Virtual CFO can also assist in fact-based decision making. It’s a critical and complicated task for any organization to make a decision regarding investing and procuring funds. The outsourced CFO services have strong networks of key investors and experts in the industry which enables you to make an informed decision. Hence, it provides one with better options as compared to an In-House CFO.
Focussed Decision Making
A team of VCFO will weigh upon focusing on the core areas instead of indulging into day to day activity like an In house CFO. This ability of an outsourced CFO gives them an edge over the conventional in house CFO by facilitating better decision making, prompt problem solving and smooth implementation of processes ensuring better functioning of the organization.
Team Effort for Problem Solving
A Virtual CFO brings knowledge of a professional team;however,an In house CFO brings only individual experience. A team thus can provide myriad of solutions for a single problem, not limiting the scope of solving for the same which cannot be leveraged by having an in house CFO.
The services offered by Virtual CFO are less expensive as compared to an In-house CFO. Although bigger organizations are capable of affording In-House CFO, when it comes to start-up and small companies, they cannot afford to hire a full-time CFO. For smaller and mid-sized companies, utilizing the benefits of Virtual CFO Services is a much better option. By opting for outsourced CFO services, the companies can reduce its expenses considerably.
Standardized Reporting Format
The experts at Virtual CFO services have good exposure in the field of finance. They understand the importance of widely accepted reporting format thus; they bring reporting in a standard format. This, in turn, helps you in presenting tax reports in best way.
For business to grow and mature, it is necessary to opt for the services of an accounts outsourcing firm or a “Virtual CFO “, ( VCFO ) to simplify fatuous processes. One of the most common questions raised regarding this is the dissimilarities and similarities between accounts outsourcing and VCFO services.
They both provide similar services in terms of finance. However, a VCFO service usually goes an extra mile knowing your business, taking care of end to end financial matters and providing financial analyses along with strategic business inputs. Albeit, Accounts Outsourcing and VCFO Services, both are considered efficient ways to save money and time of the organization, these services differ from each other in the following ways:
Accounts outsourcing firms provide services like handling bookkeeping, accounting and other simple functionsthat tend to focus only on current results. Whereas, a VCFO provides with better strategiesfor the same processesi.e. pursuing long term benefits. In other words, a Virtual CFO is an all rounder who provides you with knowledge that is outside the domain of accounts outsourcing firm.
A VCFO will therefore guide you through financial planning, developing of strategies, analyzing developed strategies, obtaining resources,maintaining resources and advocating government on your behalf which will in turn be helpful for you in long term planning for your company in addition to the services offered by an accounts outsourcing firm.
Accounting outsourcing firms tell you where your finances are lacking by providing you with daily, monthly or quarterly reports. Whereas, VCFO analyses such reports and makes long term action plans through financial planning, fundraising andby providing with tips& tricks to know how and where to invest to get maximum returns.
Business has various dimensions and it is not possible to handle all of them efficiently at all times. A VCFO, therefore, makes a business aware of all the possible threats and opportunities coming its way through his experience and vast knowledge of businessby working on a budget planning , budgeting, costing analysis, policy making etc. for the business which give an overview of all the possible problems coming its way. Whereas, an accounts outsourcing firm provides help only with audit, data analysis and implementing basic policies.
Every company needs accounts outsourcing to perform traditional services which are of great importance in day to day routine but apart from that it requires ideas and suggestions to provide value beyond compliance benefits. A VCFO, therefore, not only helps in tax planning but also guides on key tax practices and streamlining it to their benefit.
Therefore, outsourcing accounting services give guidance on all technical matters relating to finance and a Virtual CFO gives a deep analysis on finance, tips on latest trends and technological advancements.