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6 Questions To Ask Before Handing Over Your Finances

6 Questions To Ask Before Handing Over Your Finances

6 Questions to Ask Vendors Before Outsourcing Your Finance Department

Outsourcing your financial tasks to another company is an important decision with far reaching consequences. The following questions will help you make sure you choose the right vendor for your company’s needs.

Q:1 What Services Do You Provide?

The Finance function of your company can encompass a wide range of jobs. Some of these include – bookkeeping, payroll, financial analysis, strategic planning, forecasting, budgeting, tax strategy, tax compliance, and auditing. Some of these jobs are best suited for bookkeepers, others for licensed CPA’s. A CFO may be more appropriate to oversee the whole thing and implement the proper systems. Knowing what you need done before taking bids will save you money and make outsourcing less nerve wracking.

Q2: Which accounting software(s) are you proficient in?

Obviously, software plays a big role in every business function. Accounting is no different. Choosing the correct software for your company’s workflow and scale is an important decision that you will have to live with long term. Choosing the correct vendor who either can implement a new accounting system she is familiar with with little disruption, or can work within the framework of what your company has set up is something to consider.

Q3: Which pricing model do you use for your services?

The three most common pricing models in this business are flat, hourly, and retainer. Hourly is the simplest, but also the hardest to control costs. Flat is good because you can easily budget for it, but it may limit the scope of what you receive from your vendors as they have to control their costs. Retainer is a good compromise. You get the benefit of defined scope, and the option to add jobs as you need them. The vendor is instantly committed to your project when the retainer is funded. This can be a win-win with the right vendor for the job.

Q4: Do you insist on signing a contract?

Many service companies are shifting to a month to month model to attract new customers who may not be willing to commit long term. The benefit here is obvious. However, there are implications of outsourcing your finance department that may call for written agreement. Your company’s books are confidential, and the information contained within them can be used to compete or destroy your company in the wrong hands. Confidentiality and non-compete clauses are considerations you should not take lightly. Consult legal counsel for expert advice on this subject.

Q5: What’s the best way to contact you and how often should we be in touch?

This question will give you an insight into how responsive the prospective vendor will be. One of the biggest complaints I’ve heard from our clients is that their past CPA’s or bookkeepers were hard to get a hold of, especially during tax season. You want to make sure the company you are outsourcing to has your project on their radar, and returns your calls within a reasonable time.

Q6: How can you help me grow my business?

This question reveals the value proposition your prospective vendor is offering you. The most important aspect of having a proper accounting system in place is the value of the information it provides. If your vendor cannot describe with certainty and confidence how he can provide the proper information for you to make better business decisions, there is no reason to continue the conversation.


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