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A Proven Solution for Mitigating Reporting Risk and Growth: Outsourcing Accounting and Finance

Alexandr Revelo, CPA, CA

Founder & CEO, Revelo Consulting

We know first hand that running a business is no easy task. Depending on the stage you find yourself in, wearing different hats is unavoidable and leaders find themselves stretching resources too thin of hiring unqualified staff. We discuss below the most common issues faced by firms when it comes to their financial functions regardless of their industry.

Founder Owned Start-up

The most common issues found with with startups is their current accounting being done on a cash basis or mixed. Time constraints, lack of expertise or just plain lack of understanding of what investors want to see, founders who are not trained in accounting will tend to report a mixed bag of numbers which will not necessarily represent the true standing of the company. This is a cardinal mistake - after all, investors will always drill down on revenues, revenue growth & S&M spending. If the figures are not true representations of the company's financial position due to accrual vs. cash reporting, then they are off to a wrong start.

Given these challenges, founders will be tempted to hire underqualified individuals to perform bookkeeping, who also lack the know-how to develop projections and KPI's. Although there may be cost savings in the immediate term, in the long term cleaning up the financial data and preparing auditable financial statements becomes a high cost burden.

Industry Specific Expertise

KPIs for tech-startups is a whole world different than the KPIs of not-for-profits. Hiring the right people with the right skill set is essential to smooth reporting and auditing of financial statements. Mindbridge reports that stress is highest for management during audit busy season and this is for a reason - understanding auditor expectations and correct reporting frameworks tends to be a pain point in any organization from any industry.

During audits, staff will be burdened with performing their usual operatinal tasks as well as meeting the heavy demands of auditors. Coupled with the stress of meeting board reporting deadlines or public filings, the audit process can turn into a mess with delays and unecessary hardship.

Established Firms

A common misconception is that only start-ups and small budget firms tend to outsource their accounting functions but this is certainly not the case. According to a study conducted by Grand View Research the largest players in IT and telecommunications dominated the BPO market in 2022 with a revenue share exceeding 34%.

Common issues cited are managing cost pressures from hiring and training, reduction of capital expenses and access specialized resources. In addition, generation Z will account for 27 percent of the workforce by 2025. Gen Z is defined by being the first digital generation, they are pragmatic, and can change jobs up to 10 times. Firms must take these facts into consideration if they want to remain competitive in the coming decades.

The Revelo Solution: Outsourcing Accounting and Finance

Revelo Consulting bridges the gap that founders and managers find themselves in when trying to manage cost pressures and the constantly changing tech and labour environment. Our experts come from backgrounds of every industry and are ready to hit the ground running when joining your team:

  1. Aid in the clean up and optimization of internal record keeping and accounting processes

  2. Interim oversight and support as required by management team

  3. Fill in the gap in high staff turnover or underqualified staff

  4. Proper software implementation and training

Integrated Financial Team

Our fractional accounting teams support your finance department during the most challenging of times, be it during an audit or preparation of board reports or quarterly filings. Our teams range from basic accountants and bookkeepers to C-suite professionals with a wide range of knowledge and experience.

Is outsourcing your accounting and finance functions the right move for you? Find out by contacting us today!

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