Running a small or medium business involves managing a range of priorities and challenges, many of which can needlessly burden the management team. By investing in qualified accounting resource, finance doesn’t need to contribute to the burden.
In SMEs 36% of those responsible for finance and accounts do not have a relevant qualification
According to recent research by the Association of Accounting Technicians (AAT) into how SMEs manage their accounting:
- 60% of business owners manage their company’s finances, putting an extra strain on their time.
- Just 26% of SMEs have one or more dedicated members of staff looking after finance and accounts.
- 36% of those responsible for finance and accounts do not have a relevant qualification.
- 48% have learnt ‘on the job’.
- Resulting in £2.9bn being lost across the economy from tax miscalculations, unpaid invoices and fines.
SMEs that invest in finance and accounts are more successful
Businesses that invest in the right mix of finance and accounting skills reap the rewards. They:
- Have access to high quality, relevant management information which improves the decision making process.
- Provide a professional, credible point of contact for their customers, suppliers, investors and potential acquirers.
- Benefit from up-to-date industry insight and best practice.
- Remain compliant with legislation and taxation, avoiding miscalculations, unpaid invoices and fines.
- Will be a more attractive investment proposition when seeking funds from banks or external investors.
- Are a step closer to achieving a successful exit when the time is right.
Mind the gap!
An SME has to allocate funds to the recruitment, training and retention of finance staff to ensure they not only meet the needs of the business today, but that they anticipate the needs of tomorrow. Take the Finance Director role as an example. The skill set of a start-up or operational FD is very different to that of an FD who can identify cost rationalisations or one who can drive growth, and will be different again to the FD who specialises in maximising shareholder wealth on exit.
The gap between the skills an SME can access/can afford to have in house versus the skills they need to help drive their business forwards can be huge.
Outsourcing bridges the accounting skills gap
By outsourcing your finance function, you can have:
- Access to a full portfolio of qualified finance and accounting professionals from bookkeeper to finance director on an ‘as required’ basis – a few days a week, a few days a month, at quarter’s end or a year’s end. No recruitment costs and no HR worries.
- Access to professionals in all finance and accounting disciplines from transaction processing (e.g. purchase and sales ledgers) through to the development and implementation of the 3-year plan.
- Access to a ‘trusted friend’ someone who can interpret the numbers and direct the strategy. Someone who is not afraid to ask the difficult questions.
- Access to an ever-changing and flexible skills mix which can scale alongside your business.
Most importantly, through outsourcing accounting and finance
An SME can have a management team who have the time to focus on the things they should be thinking about – product development, customer experience, supply chain and profit maximisation all of which will contribute to the overall goal of building a successful business and create shareholder wealth.