Finance and Accounting

Ultimate Guide to Outsourcing Your Finance and Accounting Team​

Controlling your finances means controlling your business…efficiently. Simply put, finance and accounting is at the heart of your company’s success and survival. The formula for effectively navigating a business towards success is by effectively managing income and expenses and having a great finance and accounting team. With those factors at hand, unexpected financial downturns can be easily circumvented. Generating business strategies and contingency plans can also be designed more adeptly through a well-established Finance and Accounting process and skilled domain experts team.

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1 month ago No Comments Views

Skills and Credentials to Look for in an Accountant

Financial management is one of the most crucial aspects of business. According to The Business Journals, 80 percent of businesses in the United States fail within the first year mainly due to poor financial management.

This is why it is important for companies and organizations to build a great, high-performing team of accountants to effectively perform tasks such as analyzing and preparing financial records, computing tax returns, and ensuring that financial documents are accurate and in compliance with relevant laws and regulations among others. 

To effectively build a great accounting team, knowing the following certifications ensure that you are employing the best people for your business. Below are several certifications and licenses you have to take note.

Accounting Certifications and License

  1. Certified Public Accountant

According to international staffing agency Robert Half, the Certified Public Accountant (CPA) license is considered as the gold standard for accounting and finance in the United States. Granted by the American Institute of Certified Public Accountants (AICPA), this certification validates that an accountant has expertise in skills such as forensic accounting, tax, compliance, and risk management.

  1. Chartered Global Management Accountant

This financial certification, on the other hand, is granted by both the AICPI and the Chartered Institute of Management Accountants (CIMA) to CPAs working in business and government. This guarantees one’s competency when it comes to management accounting skills.

  1. Certified Management Accountant

Recognized globally, the Certified Management Account (CMA) certification demonstrates a professional’s mastery of critical accounting and financial management skills. This is granted by the Institute of Management Accountants (IMA).

Best accounting skills to look for

Beyond these certifications, there are also a handful of skills that an accountant must possess to be able to do their tasks effectively in the workplace:

  • Accuracy and strong attention to detail

When it comes to financial management, the smallest of errors can have serious ramifications to a business when left unseen. The responsibility of ensuring the accuracy of information falls on the shoulders of accountants so it is important that they are consistent in paying strong attention to detail when it comes to analyzing bulks of financial data.

This is also where organizational skills come into play as accountants deal with not just huge quantities of data but also a variety of different systems that need constant maintenance and updating. They should be able to structure their tasks without compromising the others especially during the busier times of the year.

  • Proficiency in accounting software

As more accounting firms and organizations adapt the use of accounting automation in their operations, accountants should be able to navigate finance-specific software programs with ease. These programs range from spreadsheet platforms, enterprise resource planning (ERP) systems, business intelligence softwares, and many more that are used for managing different accounting activities.

  • Analytical and critical thinking skills

The mere profession of accounting is analytical in nature so it is important for accountants to be quick on their feet when it comes to identifying the appropriate techniques to be used in executing extensive financial analysis as well as in interpreting financial data and analyzing patterns and potential issues in the information. That is why you should also look for a team who is aware of  F&A regulations, taxation laws, GAAP and Sarbanes-Oxley.

Once faced with errors and discrepancies, accountants should be critical in making firm and calculated decisions to solve these problems by considering all variables and potential risks in developing effective solutions.

  • Good communication skills

More than just analyzing data, accountants should also know how to properly present it in a concise and organized manner that even numbers-savvy individuals can understand. Verbal and writing skills should also be refined to be able to relay information properly and avoid errors due to miscommunication.

Accounting is important for a business, may it be big or small, because it helps you keep your financial affairs on track, ensures that your business is in compliance to relevant laws and guidelines, and gives you the opportunity to make future projections for your business. With a highly-skilled and competent team of accountants on the job, you are guaranteed to be on your way to success.

Building a Great, High-Performing Team

One  great way to build a dedicated team of accounting professionals is by finding the right outsourcing partner because their speed to market hiring process allows you to have the best fit accounting talents for your company in only 30 days with 70% savings on operating cost.

With an outsourced team at your service, you can focus more on daily operations and achieving your business goals. More importantly, the right outsourcing is ISO-certified and GDPR-compliant, and has a well-established Information Security in place to ensure that your company’s books and confidential financial information are kept secured. 

Partnership with Infinit-O

Infinit-O’s mission is to create endless opportunities for your company to realize your full potential.

Infinit-O Key Benefits:

We can build you a great, high-performing F&A team! Here are some examples below:

Let’s work together to build a great Finance and Accounting Team.

Start small. Exceed expectations. Think infinitely. Think Infinit-O.

1 month ago No Comments Views

How to Win the Number Game and the Value of a Great F&A Team

Business is a number’s game.

To get full control of your company, knowing where money is going and coming from is your leverage in effectively navigating a business towards success. If numbers such as income and expenses are managed effectively, it builds a strong avenue for potential growth and achieving your goals by creating strategies to weather unexpected financial downturns.

But how do you win the number’s game?

By building a great F&A Team.

Since all businesses, regardless of industry, depend on tactical financial management, you need to have a great finance and accounting team to keep your company headstrong in the number’s game because they play a key role in guaranteeing your win.

We listed 3 reasons how they can secure your success:

  1. They keep clean financial records

Finance and accounting both essentially record your company’s past, present and future financial activities. Although finance focuses mainly on future acquisition and accounting leans more on tracking your past financial transactions, they are your ledger in tracking income and expenses on your current and future operations.

Through them, you can maintain accurate data of your financial activities that can help you understand your business’s cash flow and preempt future acquisitions, potential savings and prospective revenue.

  1. F&A circumvent legal problems

A team of F&A experts make sure that they adhere to important business laws because they know that overlooking a minor detail could have major implications to tax management and extirpate a company. Poor financial records can lead unavoidable audits and possibly face unnecessary legal troubles.

Reliable and responsible F&A team ensures statutory compliance is practiced accordingly by following economic laws and regulations. On top of it, they are also ISO 27001:2013 and ISO 9001:2015 certified. They make certain that liabilities such as sales tax, VAT, income tax, and pension funds, to name a few, are appropriately addressed.

  1. Help develop financial strategies

A high-performing F&A team not only keeps a clean financial record and assists you in avoiding any legal problems, they are also your ally in developing financial strategies to keep your business growing and helping you achieve your financial goals. They can generate financial reports and thoroughly analyze your company’s books which you can use to have a better understanding of your company’s cash flow giving you an avenue to develop optimal financial strategies.

Business owners who have a better view of their fiscal records empower them to make informed financial decisions and map out plans to secure their growth and success. Lastly, knowing your current financial standing can also help you identify new areas of growth that can be used to create more opportunities for business accomplishments.

Challenges in building great F&A Team

The next step to secure your victory in the number’s game is to employ the right experts and build a great F&A team. But, there are two hurdles in doing so; salary and available talents.

Higher and Increasing Salary

Finance and accounting belongs to the high paying talents in the job market. A US Bureau of Labor Statistics (BLS) records that the median pay for a Financial Analyst in 2014 was $78,620 per year, $37.80 per hour but it is projected to grow by 12% in 2024. Accounting on the other hand has a median pay of $65,940 per year, $31.70 per hour and is projected to increase by 11% in 2024, which is also an above-average growth rate.

This means that to build an F&A team means to invest on the right people because employing them requires paying a hefty amount for their salary. 

Shrinking Talent Pool

In addition, there’s a limited pool of talents for the F&A profession in the US.

Finance and accounting talents aged 55 and up have increased in the past 10 years. This makes the talent pool of younger, experienced and highly qualified candidates shrinking. Although there are fresh graduates and novice F&A professionals in the pool, companies prefer those that have years of experience making the hunt more challenging.

Right Partner, Great Team

One sure way for a business to build a great finance and accounting team is by finding an outsourcing partner who has access to the talent pool talents while ensuring up to 70% savings on operation cost. A premier outsourcing partner will take care of scouting the best fit people for your company and employing high performing finance and accounting specialists that match your unique needs. Because of their access to world-class talents and a speed to market hiring process, you can easily build a great F&A team and focus more on navigating your business towards success.

Partnership with Infinit-O

Infinit-O’s mission is to create endless opportunities for your company to realize its full potential.

We can build you a great, high-performing F&A team! Here are some examples below:

Let’s work together to build a great Finance and Accounting Team.

Start small. Exceed expectations. Think infinitely. Think Infinit-O.

1 month ago No Comments Views

Top 3 Tools to Use for Finance and Accounting

Dealing with financial reports and keeping up with expenses manually can be a tedious and exhausting process. Just like any other industry, finance and accounting also has its own set of challenges and one major pain point is the growing demands of technology and process efficiencies.

Traditional finance and accounting internal systems and infrastructures are now deemed to be obsolete. As a result, it is now more important than ever to use the right tools for your finance and accounting team. However, an overwhelming number of tools are marketed to help improve efficiency and make F&A tasks easier and quicker. Yet, choosing the best tool for your finance and accounting team can be quite challenging as well as building a team that has proficiency in utilizing these tools.

Knowing the top 3 tools for finance and accounting is your ticket to increase your F&A team’s productivity and improve their efficiency .

Top 3 F&A Tools

  1. Accounting Software

There are now plenty of modern and effective software being offered. However, before deciding on what accounting software to use, it is crucial to ensure that it has features catering your business requirements (e.g. POS software integration, cloud-based entries, or tax information)

Here are some of the new and top-rated accounting software in the industry:

●       Sage One

Sage One is one of the current leading industry providers for accounting software solutions. A cloud accounting and invoicing software designed for small and medium business owners. It can also help bookkeepers and accountants do their jobs quicker and more efficiently .

Its advantages are; easy inventory tracking, automated sales tax rates, project tracking, and flexible user permission. However, the reports it generates are not freely customizable.

●       Zoho Books

Zoho Books is part of the Zoho application family. It boasts an impressive selection of accounting tools fit for both finance and accounting teams and business owners.

The notable features of Zoho Books are it’s easy invoicing, tracking expenses, monitoring bank transactions and inventory tracking. It can also generate cash flow statements and balance sheets.  It can also connect with other Zoho applications such as Zoho expense, CRM, Zoho Subscriptions, and many more.

●       QuickBooks by Intuit

QuickBooks by Intuit is one of the traditional software that was able to keep up with the growing demands of technology today. It is a user-friendly software that can be used even by non-finance and accounting experts.

It has a bold promise in helping you save at least 8 hours of work in a month. It creates a comprehensive dashboard, invoice tracking and creation, automatic expense categorization, VAT tracking, and calculation, among others.

2. Expense Tracking

Expense tracking is paramount for any company. It is an extremely tedious job, especially when there are a handful of expenses moving in and out. Although some accounting softwares already includes expense tracking features, a dedicated and specialized expense tracking tool is still a must.

Here are some expense tracking tools to consider.

●       Rydoo

Rydo is one of the top choices for specialized expense tracking software because of its affordability. it also has international expense tracking, which will do wonders if your business deals with a lot offoreign deals.

●       Expensify

Expensify is a good tool for expense tracking because it is user-friendly and convenient. It is easy to load information and provides prompts on what are the next steps. It also has a reminders feature that alerts you if there are documents not yet submitted and file. It also has notifications for books for  reimbursement.

3. Billing Tools

Among all the finance and accounting duties, billing processes can be the most time-consuming and tedious.  Licensed professionals with years of experience can still find billing duties to be challenging. However, it is a good thing that there are now softwares specially designed to make billing more manageable.

●       SuiteDash

SuiteDash is a billing tool best suited for small to medium-sized businesses. It has features such as client portals, invoicing, project management, and file sharing.

It is a fully integrated cloud-based platform that combines most commonly used business tools so finance and accounting teams and business owners don’t need to go through the frustration of learning other platforms that don’t work well together.

●       Nexway Monetize

Nexway Monetize allows easy implementation of billing plans and subscription models tailored to a specific business. It is best suited for SMB and large enterprises. This customizes invoices a lot easier. It also has a feature allowing you to send foreign client invoices in their local currency and language.

●       Zoho Invoice

Here’s another member of the Zoho application family. It is designed for business owners and freelancers. Like other Zoho applications, this one is easy to use and allows you to create a fully customized invoice so that you can get paid quicker.

Great Tool, Great Team

Having the right tool for your finance and accounting team is vital to help them accomplish their tasks easier and quicker. By doing so, your company’s overall efficiency and productivity can also increase. With that, it’s easier for you to see whether your company is earning the revenue you expect, allowing you to make quick and accurate financial decisions. 

Dealing with these tools can be overwhelming. Additionally, building a team of F&A experts and training them on utilizing these tools birth another layer of operational responsibility especially if there is a limited pool of talents in the F&A industry and the number for highly qualified candidates are shrinking. One way to overcome this is by finding the right outsourcing partner who has access to world-class F&A talents who can equip and certify your team to put these tools to good use.

In addition, softwares such as those mentioned above, can already break your bank. But with the right partner, you can save up to 70% on operational costs, yet assuring your team’s efficiency and productivity.

Partnership with Infinit-O

Infinit-O’s mission is to create endless opportunities for your company to realize your full potential.

Infinit-O Key Benefits:

Below are some examples of F&A expertise that we can recruit to build a team just for you:

  • Accountants
  • Bookkeepers
  • Finance Associates
  • Finance Specialists
  • Fund Treasury Associates
  • Other F&A positions

Let’s work together to build a great, high-performing Finance and Accounting team

Start small. Exceed expectations. Think infinitely. Think Infinit-O.

2 months ago No Comments Views

The Difference Between Finance and Accounting

Finance and accounting are usually lumped together. But understanding the key differences will allow you to better distribute fiscal responsibilities to the right people and create a great finance and accounting team for your business.

The Basics

The basic difference between finance and accounting is their core responsibility. Finance is the one exercising high-level control for your company’s financial strategy while accounting is taking in a more detailed look at your company’s books. To put it more simply, finance looks forward to plan future acquisition and accounting looks back to a company’s past financial transactions.

The Difference Table

To fully grasp the difference between these disciplines, let’s put it on a list.

Building a Team

With the understanding of how vastly different each role functions, the next step for a business is to employ the right experts for each department and build a great team to respond to their unique needs. Although both finance and accounting professionals almost have the same clients such as corporations (businesses), governments, and nonprofits, at the end of the day, you should carefully consider the right experts that best fit the role.

The table below shows the traits and characteristics per profession as a guide to know who to employ.

Finance and accounting decisions are tough especially if you’re trying to build your business from the ground up. At the end of the day, you should carefully consider all of the information including all the similarities and differences and decide which option best fits your business goals.

But it is also important to note that there is some level of difficulty in employing the right people for your finance and accounting team. Two major things to consider are salary and available talents.

Salary

According to the US Bureau of Labor Statistics (BLS), the median pay for a Financial Analyst in 2014 was $78,620 per year, $37.80 per hour but it is projected to grow by 12% in 2024. Accounting on the other hand has a median pay of $65,940 per year, $31.70 per hour and is projected to increase by 11% in 2024, which is also an above-average growth rate.

Talent Pool

There is a limited pool of talents for these professions in the US. The share of finance and accounting talent that is age 55 or older has increased from 2011 to 2017 hence the talent pool of younger experienced and highly qualified candidates is shrinking. Although there are fresh graduates and novice finance and accounting professionals in the pool, companies are more likely to employ those that have years of experience.

One way to address these hurdles is by building a great, high-performing finance and accounting team with the right outsourcing partner who has access to world-class talent yet assures a 70% savings on operation cost. The best partner will scout finance and accounting specialists to match them with your unique needs and help you focus on achieving your business goals.

Partnership with Infinit-O

Infinit-O’s mission is to create endless opportunities for your company to realize your full potential.

Below are some examples of F&A experts that we can recruit to build a team just for you:

Let’s work together to build a great Finance and Accounting Team.

Start small. Exceed expectations. Think infinitely. Think Infinit-O.

3 months ago No Comments Views

The Benefits of Outsourcing Finance and Accounting Services

A business is only as strong as its weakest link. Without an efficient accounting team  and processes, a business cannot generate quality financial reports and statements. Regardless of the size of the company, accounting is at the heart of a company’s success. 

Small and medium business owners face accounting challenges everyday, while they are trying to simultaneously service their customers and perform their core value proposition because they often do not have the workforce or the resources to get the accounting job done. Building an accounting team is quite difficult due to limited access to the talent pool and hiring skilled professionals at an affordable cost.

To overcome this, partnering with an outsourcing company to help you build a great accounting team can help you hyper focus on your business goals.

Cost Savings

When you in-source accountants, you will pay their salaries and benefits such as medical and life insurance including the purchase of all of the softwares and tools they need to get the job done. This is really expensive. But, if you build an outsourced accounting team, you can cut those operational expenses up to 70% off.

The savings that outsourcing partners usually provide is considerable without reducing quality of service and compromising productivity. They will take care of the employee’s salaries, taxes, benefits and other operational expenses while you still get the full benefit of a full-time employee.

Access to available talent

The accounting profession is experiencing a tightening pool of skilled candidates globally making the hiring process even more difficult. As a result, companies are spending more to hire skilled accountants by bumping up compensation offers and being more flexible on the negotiation requests from these professionals. In return the company will have to invest more to hire them.

But with the right outsourcing partner, you won’t have to deal with scouting accountants that will match your unique needs because of their access to world-class talent and A+ recruitment process.

outsourcing; finance and accounting; F&A, finance & accouting

Eliminate hiring process and cost

In connection with the above point, another great thing about third party accountants is that they will take care of the hiring process and filtering the best people for your company and making sure that they have the proper certifications and skills. 

Recruitment and hiring is time consuming. Dealing with this along with making sure that your business goals are being worked on may add another level of challenge you have to face. Aside from scouting and screening applicants, background checks and interviews, newly hired team members have to be trained on the ins and outs of your business to get them fully on board with your company’s vision. Your outsourcing partner can do all the necessary training to fully equip them.

Time efficient

As your business grows and you focus more on achieving your business goals, you will find yourself dedicating more time and energy on managing your growth and less on micromanaging non-core activities. Therefore, outsourcing administrative and financial tasks like bookkeeping and accounting help realign your resources on creating the business strategies. It will be bringing more revenue, as well as networking and building relationships with your clients.

Partnership with Infinit-O

Infinit-O’s mission is to create endless opportunities for your company to realize your full potential. 

Below are some examples of F&A expertise that we can recruit to build a team just for you:

  • Accountants
  • Bookkeepers
  • Finance Associates
  • Finance Specialists
  • Fund Treasury Associates
  • Others

Let’s work together to build a great Finance and Accounting Team.

Start small. Exceed expectations. Think infinitely. Think Infinit-O.

3 months ago No Comments Views

Outsourcing Your Accounting Services to Maximize Business Growth

Starting a Business

Accounting might not be the most thrilling aspect of a business. You would perhaps prefer to babble about the products you manufacture and how you will market them rather than tackle your accounting responsibilities.  Managing cash flow is one of the core principles of any business. The accounting department takes the center stage when finance is concerned. For one, it helps in evaluating the business status with the financial reports they present. It says a lot on the resource utilization, budgeting, and projections. A company also needs to worry about legal business compliances as well as filing for financial statements. All these functions handled by the accounting department are paramount to the survival of any business.

That is why, it would be best if you acknowledge that accounting is crucial to managing your finances efficiently. It is one of the central forces in your business. It is not just one of the business aspects. It is valuable to make the business unsinkable. So, the next thing you do is to work on the bookkeeping tasks.  

Outperforming Bookkeeping

Bookkeepers are insightful in managing A/R, collections, A/P, deposits, bank account reconciliation, payroll, basic financial statements, and sales taxes. As they make sure that your financial books are updated and managed properly as they do you will still find yourself engaged in the accounting department. Also, in an unforeseen business challenges such as health crisis (i.e. COVID-19 pandemic) and natural calamities, having a solid bookkeeping team will secure your assets and inventory while overcoming any economic wounds. 

Why? Because there is a need for management accounting. Management accounting requires a higher level of responsibility as it prepares management and fiscal reports for business conformities. Management reporting is utilized to make business decisions clearly supported by real-time data and other indispensable indicators of performance.

But time will come that you are no longer capable of being too engaged in every facet of the business. Or when your business expands, you will realize that your time and effort will be more substantial if you concentrate on the core business management than dealing with the accounting responsibilities.

This is where you will find outsourcing to be the best thing to do next. Here are some reasons that outsourcing your accounting would aid you to reduce the hassle and allow you to maximize resources to more critical business aspects.

Cost Savings

Hiring a regular employee is a high investment in your operational cost. While these employees are vital in making the business thrive, your investment to make the business ball rolling must substantiate their efforts. Plus, the fact the regular employees are the cream of the crop, this means you also give them the cream of the crop benefits like bonuses, medical insurance, and even their retirement package which your company should contribute to.  All these equate to an expensive investment. 

Whereas, if you outsource, you will deal with your partner company. Your partner will take charge of all employee relations, compensations, and benefits. Another strength that you can bank on with a quality outsourcing partner is that they already have established domain expertise, so you can trust that they know what they’re doing.

Reduce Potential Business Vulnerability

In essence, it is critical to delegate tasks to your employees; even so, the back-and-forth needed to manage bookkeeping and accounting could result in some security concerns. A professional accounting company would seriously take your fiscal safety, and there is no need to turn over the invaluable tasks to an unqualified apprentice. 

Outsourcing accounting firms could cover payroll, bookkeeping, and invoicing requirements, along with comprehensive accounting services. They generally guarantee commitment to flexibility, visibility, and transparency to skip out on extended contracts in the event the services do not work well for you. They can also be your saving grace as a business continuity team during an emergency or disaster by overcoming financial threats.

Another two key factors that will fuel you in avoiding the risks are the ISO certification and SOX compliance. Being certified will help you align your business goals to the demands of your business partners and consumers. An ISO certified company has high regard to excellent customer experience by reducing errors and leveraging efficiency. A SOX compliant company meanwhile ensures that there is a strong financial reporting landscape by maintaining data integrity and credibility of financial disclosures.

financial plan

Be at Peace as you Avoid Accuracy Issues


Although you may be adept at tracking the finances of the firm, it is reasonable to feel distressed when it is not your field of expertise. So, do not allow constant hesitation or jitters for a huge accounting mistake to dwell inside your head.  Get rid of that fear by merely paying a professional and well-experienced firm that could successfully handle your fiscal record keeping. With the right team, you are allowing your business to breathe seamlessly by not worrying about your financial concerns.

Incorporate Global Best Practices

When you have to point out how to arrange and track the business finances more efficiently, you may opt for counting on established processes and practices. And an outsourced accounting company would already have those processes figured out. So, you could imagine how much more composed your workers would be realizing that they would be compensated in time, all because you employed an outsourced firm to cater to everything, including the payroll.  

And when it comes to the financial aspect of the business, the next thing you’ll consider is perfection. It is not impossible to attain this if you have the right policies and processes that will be the organization’s lamp as you journey to success. However, establishing that is taxing that it may drain your analytical juices. So instead, let the right outsource company handle that for you.

So now, why would you consider outsourcing your Accounting Department? 

Not to mention, one of the most excellent perks of outsourced support is personalizing a superiorly functioning staff with additional resources and know-how. Outsourced specialists who have a deeper grasp of industry-specific outstanding practices could generally improve processes and productivity and, most importantly, integrate the current staff. 

Substantially, their fiscal reporting capabilities are commonly updated with industry standards and utilize the most advanced technology. Many a time, this concentration could assist in underscoring the needs of the business and its opportunities for growth.

The bottom line is that through outsourcing your business’ accounting requirements, you are able to concentrate on what you do best – operating a business that you genuinely love, and at the same time, saving yourself a considerable amount of money, time, frustration and potential distress.

Now is the Best Time

The best time to look for a partner company is before it becomes urgent. If you only sought financial assistance during the occurrence of a crisis, say a pandemic, the tendency of work is recovery from a financial loss rather than preventing it. Having a team of finance professionals will help your company identify these unforeseen events and create financial mitigation measures that suit best for your business.

Of course, you wouldn’t want to end with a company that is just good at babbling their accomplishments. Instead, you want a track record that stands out. While many outsourcing companies are excellent in the field of Finance and Accounting (as they claim), very few are bona fide.

Infinit-O is a trusted F&A outsourcing partner and we can help you save upto 70% on operational cost. We have collaboratively built high performance teams performing to excellent results over the past 15 years. Our teams comprise competent F&A professionals such as certified public accountants in the field of internal auditing, bookkeeping, and other critical accounting functions. We endeavor to enable our clients to meet their goals in terms of business growth, better productivity, and most importantly, cost efficiency.

At Infinit-O, we build great teams. Our goal is to create long lasting partnerships with our clients; rendering a strong combination of business consultancy, process optimization, and outsourced services; all utilizing the latest technology to provide excellent value for our clients. We are ISO-certified,  GDPR and Sarbanes-Oxley compliant, so your company and data are safe with us because information security is also our priority. All these applied, your financial growth and continued profitability are sealed.

Let’s Build a Great Team for you – starting with Finance & Accounting.

Start small. Exceed expectations. Think infinitely. Think Infinit-O.

Thinking it’s time to partner up? Go and make the call.

7 months ago No Comments Views

Operational Challenges Faced by Accounting Businesses

In this article, we will learn the following;

  • The roles of professional accountants 
  • Some challenges that accountants face
  • The importance of keeping financial records 

Accounting has played an indispensable role in the business world through the centuries. It has helped to keep things orderly and bring about regulations with money affairs. Accounting as a concept started about a thousand years ago, as a solution to issues arising from the trade of goods and services. The earliest evidence of accounting dates back to the Mesopotamian civilizations by keeping records of merchandise traded and received. Ancient Egyptians and Babylonians also track their livestock and crops. 

Over the years, development in Information Technology has modified this concept. When IBM released their first computer in 1952, the first users were accountants. Although it is now very convenient for anyone to keep the financial records of their business, we cannot overstate the importance of professional accountants because accounting is more than listing debits and credits. It is a language of business and the language of all financial things. Their significant roles include:

Record Keeping and Investment Analysis

Accountants keep financial records in a bid to understand how the company is doing. This provides insight and helps the business owners to stay proactive.

Any company that intends to make and maximize profit must have a top-notch record-keeping system. Well-kept financial records help organizations and investors recognize profitable ideas and methods. The data obtained from records is crucial to the decision-making process of organizations because it helps them make sound and logical resolutions that may be beneficial for their business. Companies have been forced to shut down or scale down as a result of bad investment decisions. Other times, bad accounting sequels debt instead of profit. When companies keep documents properly, then it is easy to understand how each part of the business is doing and make decisions accordingly, all the while keeping your business financial position in check.

The story of Forever 21 is a great example of how companies need to measure customer behavior from accounting data. The clothing brand failed to recognize the shift from retail to online shopping. Instead of transitioning to digital marketing, the company focused on opening more stores. This eventually cost them a fortune as competitors leveraged delivery services and online stores. This way, their competitors made more money while spending significantly less. If financial advisers such as accountants were able to keep tabs of their capital investment on opening more stores versus the profit they were generating, their business hurdle may be reversed. 

Curbs Fraudulent Practices 

When financial records are kept properly, it makes it easy to refer to them. This is how accounting helps in reducing (and in some cases eliminating) fraudulent practices in organizations. This is achieved through the accurate tracking of all financial procedures within the company. Although fiscal laws and regulation varies from state to state, proper accounting helps you with statutory compliance in your business. Hiring the right team ensures proper bookkeeping of sales tax, VAT, income tax and regulating funds which all helps in combating possible fraud activities.

Integrity and Reputation

Transparency is crucial to business dealings, and it is the reason why the proper documentation of financial records is vital. General and precise facts of accounting preserve the reputation of business. An honest representation of all financial proceedings in an organization depicts a trustworthy company. Investment capital from outside sources are not as beneficial as in house funds. Accurate and transparent financial reviews of the company’s financial operation makes their stakeholders trust them more. In business, the right name is better than silver and gold. 

OPERATIONAL CHALLENGES 

All the aforementioned are parts of the benefits of accounting. However, every profession has its challenges, and accounting is not spared from this axe swing.

Below are some operational challenges faced by the accounting business:

Skills Update and Training 

The world has reached an age where every profession is evolving due to development in information/communication technology. This causes modifications to the training process and core skills and tools that you require. These skills and tools make business processes more manageable because they simplify and speed up accounting processes

The challenge with the accounting profession is keeping up with ever-evolving trends. For example, accounting procedures such as auditing have improved to achieve better results.

Technological advancements have made it possible to automate accounting processes and maximize data for insights. Accounting professionals need to focus on keeping up with these tools. Partnering with accountants who are constantly progressing with the current training and tools in accounting such as Quickbooks, Xero, Tallie, Kashoo, QuickFile and others furnishes their intuitive making them do their jobs quicker, more accurately and in ease. This is the only way to keep the company running. 

Experienced Personnel

Accounting remains one of the most sought after professions in the world. Although there are a lot of new blooming accounts out there, in a rapidly growing business, the need for experts in this profession is vital, and passable skills cannot be tolerated. Unfortunately, accountants with the needed expertise are scarce, and this has proven to be one operational challenge of the accounting business. Professionals need to ensure that they stay updated with the latest skills and tools. This is a great way to ensure the proficiency of your accounting processes. There is a need to have professionals managing every aspect of the business. The accounting sector is one that requires a highly experienced and proficient workforce. The constant use of technology in the accounting profession is a critical factor for companies to consider. This factor has significantly influenced the competition among accounting firms.

Fraud

In the last point, we talked about the importance of experienced personnel. However, even with qualified staff, you may still be faced with fraud. One of the challenges facing the accounting profession is the accuracy of accounting and complying with financial laws and regulations and internal procedures of your company. This issue stems from either inadequate accounting systems or poor organizational skills needed for the job. Subsequently, this leads to the inability to detect or prevent fraudulent activities because of inefficient bookkeeping. 

In many cases, this happens because professionals with the technical know-how on detecting issues regarding treachery are few. Eventually, this leads to successful manipulation of data. As we mentioned earlier, the primary role of accountants is to ensure transparency. 

Economic Laws and Regulations

You can control the challenges mentioned above internally. Although, constant look out for other uncontrollable challenges is as crucial.

The economic laws and regulations cannot be excluded as one the challenges in the accounting profession. The decisions the government make plays a significant role in the accounting business in specific ways. For example, government policies such as tax rates and interest rates may affect the economy and subsequently, the accounting profession. These factors influence the accounting industry and transform the way it compares to global accounting standards. New government policies come out as often as how the economy moves. Albeit how updated rules help stabilize what’s happening in the market, this requires accountants to adjust and shift their bookkeeping according to the new law. The need to update their clients on what has changed may cause lag time on keeping records resulting in a halt on incoming profits.

Changes in Practice Globally

Apart from the activities in the market that affects economic laws and regulations, global trends in accounting also affect the way accounting is done. With the popularity of the internet, accounting firms can compete on a worldwide scale. This particular challenge affects firms that only utilize local accounting processes. The constant change in accounting standards globally can, at times, stunt the growth of the local accounting process. For example, advancements in record keeping and data optimization are improving globally at a fast pace. This often leads to a backdrop in the economic progress of companies that operate with local standards (when compared to their competitors that use international standards). This where partnering with a company that operates their quality  in a global standpoint comes in handy.

ROUNDING UP…

“The introduction of data analytics and innovative technologies, such as artificial intelligence, bots, and drones, provides the opportunity for the greatest change in the accounting profession since the passage of the Securities Act of 1933 and the Securities Exchange Act of 1934,”- George Scott, chair of the Federal Accounting Standards Advisory Board.”

Several challenges permeate the accounting business. Although these factors can be controlled, conscious and consistent effort to keep up with these changes are required. Every company needs a dedicated accounting team that will provide monthly, quarterly, and annual reports.  It is best if you also streamlined financial accounting functions while focusing on other crucial aspects of business operation.

Here at Infinit-O, we understand the value of keeping your financial records secured. We  build great teams best fit for your business that includes finance professionals performing internal auditing and bookkeeping services among others. Through this, we can ensure your company’s financial growth and continued profitability.

At Infinit-O, our goal is to create long lasting partnerships with our clients; rendering a strong combination of business consultancy, process optimization, and outsourced services; all utilizing the latest technology to provide excellent value for our clients. We are ISO-certified,  GDPR and Sarbanes-Oxley compliant, so your company and data are safe with us.

Let’s Build a Great Team for you – starting with F&A. 

Start small. Exceed expectations. Think infinitely. Think Infinit-O.

We hope you enjoyed reading this!

7 months ago No Comments Views

Difference Between Accounts Payable and Accounts Receivable – Infinit Accounting

When one thinks of how successful or unsuccessful a business is doing, it’s natural to lean towards the strategic elements of an organization that ensure profits come in: investments, funding decisions, and risk management. While these elements are important, the success of a business, especially how it runs its day to day operations, is highly dependent on the effective management of operational cash (or commonly called cash flow or cash on hand). This comes in the form of accounts payable (A/P) and accounts receivable (A/R).

Accounts Payable VS Accounts Receivable

Accounts Payable

Accounts Payable (A/P) refers to the money that the company owes to others, usually because of purchased goods or services on credit from a vendor or supplier.

Accounts Receivable

Accounts Receivable (A/R) refers to the money that others owe to the company and are amounts the company has a right to collect because it sold goods or services on credit to a customer.

What’s the Difference Between Accounts Payable & Accounts Receivable?

In accounting, the nature of transaction dictates how it is recorded in a company’s general ledger (or financial books).

  • Accounts Payable (A/P) is recorded as a liability, while Accounts Receivable (A/R) is considered an asset.
  • Accounts Payable (A/P) will decrease the company’s cash while the opposite will happen with Accounts Receivable (A/R).
  • For money to go under Accounts Receivable (A/R), an invoice should be generated and delivered to a purchaser of goods or service, with payment usually expected within agreed payment terms. Accounts Payable (A/P) appears on business ledgers when an invoice is approved for payments.

Accounts Payable (A/P) = CASH OUT
Accounts Receivable (A/R) = CASH IN

The Importance of Having a Balanced A/P and A/R

The keen management of account payables and receivables has a major impact on how liquid a business is. Liquidity in a business refers to a positive net working capital, which simply means that there is enough cash on hand to keep the business operational.

The working capital (WC) of a business is the difference between the current assets and current liabilities. The collection of assets in a timely manner and a balanced settlement of liabilities ensure a healthy and positive net working capital.

Management of Working Capital (WC)

To effectively manage one’s working capital, the Days Sales Outstanding (DSO) of accounts receivables should be less than 45 days. DSO refers to the average number of days accounts receivable payments are collected. Accounts payable are analyzed by the average number of days it takes to pay an invoice (Days Payable Outstanding or DPO).

How do You Increase Working Capital?

Reducing DSO and increasing DPO can increase working capital. Simply put, businesses collect payments from customers faster and delay vendor payments. However, increasing working capital isn’t as easy as it looks as delaying vendor payments can tarnish a business’ reputation and faster payments collection can turn off customers, as they usually prefer businesses that aren’t too strict about getting paid on time.

Ideally, you should always have more accounts receivables (income) than payables (operational business expenses). This is where having a positive net working capital means business profit.

For effective management of operational cash, some businesses hire companies that offer accounting outsourcing services. This way you can focus on the core business decisions while your outsourcing partner takes care of accounting operations so you won’t need to worry about anything.

Managing your business’ finance and accounting on your own is taxing and does not always result in favorable results. With our customized solutions, rest assured that all your concerns would be addressed accordingly and at the same time, it would allow you to concentrate on other important factors vital for your company’s growth. Learn more!

10 months ago No Comments Views

5 Biggest Accounting Scandals in 2014 to Learn From

This year, we have seen some accounting scandals involving hugely popular companies. These biggest accounting scandals of 2014 rocked the world of finance and accounting and at the same time reminded us about the importance of maintaining good accounting practices. It’s important to be informed about these so that we can be warned about what not to do.

Tesco’s Accounting Scandal

Tesco, Britain’s most popular grocery and retail megastore, is known as the second-largest multinational retailer in the world. However, due to strong competition in the European market, the company’s profits have been progressively declining in the past few years. As if that is not enough to affect Tesco’s standing, their recent accounting scandal contributed to further damaging their reputation. It was revealed that Tesco has allegedly been overstating their incomes and understating costs. They had initially overstated their annual profit by £250 million, which is an overstatement of nearly 25%.

Olympus Corporation’s 13-year Fraud

Last April, Olympus Corporation, the Japanese camera and endoscope manufacturer, was sued by six banks for damages resulting from false financial statements filed from the fiscal year 2000 to the first quarter of the fiscal year 2011. The banks suing Olympus for a total of $273 million or 27.9 billion Yen in damages include Mitsubishi UFJ Trust & Banking Corp., Master Trust Bank of Japan Ltd., Japan Trustee Services Bank Ltd., Trust & Custody Services Bank Ltd., Nomura Trust & Banking Co., and State Street Trust & Banking Co. It is said to be the largest amount sought in civil lawsuits against the company.

Accounting Irregularities at Penn West

One of the biggest accounting frauds of 2014 is the accounting irregularities at Penn West. Penn West Petroleum Ltd. was just beginning to show results from a restructuring program, led by the new president and CEO, David Roberts, when he received reports in July stating the existence of irregularities in accounting practices that have been going on for several years. A large number of retail investors have been claiming operating expenses as capital expenses, which boosted cash flow and influenced the company’s stock price. They made the news public on July 29 stating that the individuals responsible for the said irregularities have been fired. On September 18, the company restated its results upon discovering the misclassification of $300 million worth of expenses.

Mobily CEO Suspended for Accounting Errors

Saudi Arabia’s telecommunications company, Mobily, suspended its CEO, Khalid al-Kaf, effective November 21, after the company was forced to restate 18 months of earnings due to accounting errors. An article on Bloomberg stated that Mobily’s 2013 financial statements were affected by an error in the timing of revenue recognition from a promotional program. As a result, the company’s shares plummeted 30 percent since Oct. 30 while third-quarter profits dropped more than 70%.

Vatican Bank Scandal

Among the biggest audit scandals of 2014 is the Vatican Bank Scandal. The Vatican Bank has been faced with scandal in the last few years. Most recently, an exclusive report by Reuters, stated that a Vatican prosecutor has frozen 16 million euros in the bank accounts of two former Vatican bank managers, and their attorney, for stealing money in 2000 from the sale of 29 Vatican-owned real estates. Between 2001 and 2008, a total of €57 million were pocketed by ex-bank President, Angelo Caloia and ex-Director General, Lelio Scaletti, together with their legal consultant, Gabriele Liuzzo.

These recent accounting scandals give us insight on the vastly negative impact of fraud, and accounting errors on a company, no matter its size and popularity. They not only lead to a decrease of the organization’s stock value but also to the decrease in profits as well as in creating damage to its reputation.

Further, we’ve learned lessons on the importance of hiring upstanding employees, who will contribute to the improvement of the company instead of lead it to its demise. It also goes to show how imperative it is to maintain good accounting practices and establish efficient accounting systems in our organization.

Infinit Accounting offers ISO 27001 & 9001 Six Sigma certified CPA’s at your service 24/7. We can help your company or firm with accounting outsourcing, insurance claims processing, accounts receivable & accounts payable outsourcing.

Inquire now to learn more!

Managing your business’ finance and accounting on your own is taxing and does not always result in favorable results. With our customized solutions, rest assured that all your concerns would be addressed accordingly and at the same time, it would allow you to concentrate on other important factors vital for your company’s growth.

10 months ago No Comments Views

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