Outsourced Accounting and Accounting Online

• Online application services: The technology that facilitates outsourcing.

• Example: Financial model for outsource practice building

   

  

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   Extra processing capacity when and where you need it.  Click here to get more information on outsourced processing support.

These problems can typically include:

• Print drivers that fail or disconnect
• Files that become corrupt or get lost
• Windows NT or 2000 is expensive to buy and to maintain… so is NetWare
• Hard drives have problems: filling up; crashing, and usually at the worst time
• Backups are either inconsistent, no good or don't get done at all
• Equipment gets old and needs upgrading
• Software needs updating: bug patches, fixes, upgrades and enhancements
• Network connections disconnect or fail
• Computer and software technicians are EXPENSIVE
• System security is usually weak or non existent
• You can't login from home
• Your staff members can't work remotely

Forrester, Gartner and other research firms have indicated that maintaining networked PCs costs the average business between $500 and $750 per month, per PC. They also say that maintaining even a small file server can cost a business from $850 to $1000 per month. These costs reflect only the maintenance of the systems, not management time, or more importantly, down time, lost productivity, lost client or practice data and lost business.

Online application services: The technology that facilitates outsourcing.

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Virtual Desktop Service
By using e-Accounting Virtual Desktops you will no longer need to have a file server in your office and you don't have to install and maintain software applications on all your workstations. Our service eliminates the worry and expense of building and maintaining a business network.

Your software and your data are hosted by e-Accounting and delivered to you via your virtual workstation that you access over the Internet. Now, you can reach your network, your workstation desktop, your software applications, and your data - at any time, from anywhere! Your business local area network becomes a high-powered wide area network, providing service to all users - regardless of their location.

For a single monthly subscription fee, you have access to your desktop and applications from anywhere. You can login to your virtual desktop while at a client's office; from home, from anywhere you have Internet access.

Outsourced Accounting Online
We've seen accountants using this online accounting model take on 2 to 4 new clients with no additional staff. This increase in revenue can really jumpstart your practice and accelerate growth.

Outsourced bookkeeping and write up work is a great revenue builder and is a perfect market entry point in that:

• Most client businesses need help with their bookkeeping
• Doing the business books leads to other services, and
• Revenues are very good, and profit margins can be great

e-Accounting can transform your accounting practice into an online outsourced bookkeeping profit center. Start with a subscription for your staff, and then bring your clients online with the service as well. Once everyone is online as a virtual workgroup, each member will be able to exchange information with other members in real time off of a single secure network from anywhere.

If your client business has multiple locations, each location would have the service installed and connected to your workgroup. That allows all of your client's offices to be working on the same set of books in real time. In addition to this, none of your staff will be forced to make personal visits to each location just to pick up records.

Once you start bringing clients onto the system, you can assign them to specific staff members so that they can work on the client books they are assigned to. Each group can be separated from others so that only the staff assigned to certain clients would be able to see those client's books, while you the practice owner would see the entire organization's books and activity.

Everyone will be working on the same system, the same platform, the same version of the software application, and all the data is secure, backed up automatically, and kept current in real time.

Qualified bookkeepers are hard to find. Often, candidates have little or no experience dealing with QuickBooks or other standard accounting applications. Owners are managing their businesses and placing high levels of trust in employees with little experience, unclear priorities, and potentially questionable work ethics.

Example: Financial model for outsource practice building

An in-house bookkeeper probably costs the average business about $2500 per month in gross salary. Add to that the taxes, insurance and other overhead items - coming up to roughly $48,000 per year. This estimate represents payroll and associated cost only, and does not include the investment in hiring, training and management.

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One method of reducing your costs and that of the client business owner's is to approach bookkeeping from an outsourced perspective. Using contract personnel, the cost of maintaining a bookkeeping position is dramatically reduced. In the case of the business owner, this contract bookkeeper is an outsource processor. In the case of an accounting practice, the staff bookkeepers as well as data entry personnel may be contract-based. This allows both you and the business owner to have absolute control over the costs of performing the work.

How To Organize The Business
In order for a professional services firm to be successful, it has to have a formal sales and marketing effort. Often, the business owner or the professional that actually performs the work represents the sales department. To build a practice quickly, and to set up the practice to filter the high-end work up to the practice professional, a sales and support staff or resource is required.

NOTE: Whether or not you decide to use outsourcers to perform some of the work, your revenues and profitability can still substantially increase simply by increasing your operational efficiencies. The following example illustrates our practice development concept that building your staff in a way that both meets your real business requirements, as well as efficiently distributing the workload using e-Accounting solutions. Any skipped steps in the model will result in workflow roll up and losses in efficiency, volume and speed.

How To Create Your Practice Development Money Machine

Step 1
At a minimum, create a sales team consisting of 1 inside sales agent who will primarily set appointments and 1 outside sales agent who will be your new business closer. You may be able to utilize other staff members to perform these tasks, however your results will not be as great than if you invest in a dedicated team.

Step 2
Use data entry operators to input the data from each client. These individuals need not be skilled bookkeepers, but they must have the ability to perform consistently and produce accurate work. Do not provide telephones; data entry operators should not have direct communication with the client and must be able to avoid interruption. A single data entry operator should be able to process work for up to 7 clients, depending volume.

Step 3
A staff bookkeeper or outsourcer should be able to manage the data entry work of 4 people. The bookkeeper manages the interaction with the client, and provides review and assistance to the data entry operators. With a full staff of operators, the bookkeeper would be responsible for managing the work for up to 28 clients.

A single accountant should be able to reasonably handle the work of 84 client businesses through up to 7 bookkeepers if only ½ to 1 hour per month is spent working for each client. This translates to between 42 and 84 hours per month of the professional's time.

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Online Accounting Model Financial Summary

Timing: Based upon 84 Clients for a 12-month period.

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The Online Solution
Using e-Accounting Solutions provides both the practice and the client business with the ability to engage regardless of geographic location. This efficiency and convenience enables and facilitates the online accounting model, and empowers each staff member to seamlessly access all the information the practice will require.

In order for this to happen, it is critical that all operators, bookkeepers, and professionals work on the same platform, system, and version of software. The efficiencies that are lost with moving data, installing and maintaining PC software, and dealing with networking issues are eliminated with e-Accounting.

The accounting firm (or process outsourcer) can contract individuals who work from home, as can the client business. Since the accounting system and all accounting data is located in one place, all users on the system have access in real-time from anywhere they have Internet access.

Source Document Process Flow
In order to address the issues of getting source documents and information from clients, we have partnered with j2 Global Communications to provide you with complete communications and unified messaging services. This means that you can have your clients fax their invoices and documents to your bookkeepers or data entry personnel - and the fax messages are delivered directly to the operator's e-mail inbox.

Voicemail messages are delivered in the same manner, so your clients can do business the way they always have and still get the information required to the bookkeeper. To handle cash transactions, simply have the client send a voicemail to the j2 account every time they make a cash purchase or deposit. The voicemail is stored as an electronic file and is sent to the e-mail inbox.

All messages - voice messages, faxes, and e-mails - can now be stored and archived as original documentation, establishing a clear audit trail for posted transactions.

To effectively enter data while viewing electronic documents (such as faxes), we strongly recommend using 2 monitors on each data entry workstation. This allows the data entry operator to have one screen for documents, and the other for their virtual desktop running the accounting application.

Invoice Reviews
Reviewing invoices or other documents is easy for the business owner. Simply e-mail the information to and from the client - if the document is an image, attach the image to the e-mail. If the client wishes to verbally approve, have them leave a voicemail at your j2 account. The message becomes part of the audit trail for the transaction and can be stored with the other original document images and files. Instruct the business owner to file all invoices by date to make it easy to locate the paper copy of the document.

Every business owner likes to do things their own way. Some of them will love not having to review every invoice. Others will insist that they review everything and sign every check. Some will want to be the only ones to decide who gets paid when. e-Accounting provides the flexibility to do business the way the client wants to without impacting the efficiencies gained.

Reducing the Number of Vendors
Cutting down the number of individual vendors the business deals with for miscellaneous items can substantially reduce the costs associated with processing vendor payables. Pay expenses by credit card whenever possible to reduce the number of cash transactions or checks which must be recorded. Paying bills electronically can be a very efficient method for tracking miscellaneous expenses - especially if the credit card company categorizes the charges on the bill. Anything that can be paid without writing a check should be.

Payroll Processing
For payroll processing, there are many solutions available to address the individual needs of the client. Regardless of which application is used to perform the processing, e-Accounting allows you the maximum flexibility in working with your client. You may choose to have the client enter the time information and you perform the processing and reporting. Or, you may do all the work and simply have your clients print the checks in their own office. You can also deliver printed checks by mail, pr perhaps establish a direct deposit process.

When performing the payroll processing for your client, gather the information in the same way that invoices and other original information is obtained from the client - via fax or voicemail or e-mail using a j2 account to handle the traffic. The fax and voicemail messages will be converted into an electronic file that can be saved and archived. This will provide you with a complete audit trail for each transaction.

Human Resource Administration
Human resources administration is an up-and-comer in the outsource world. Small businesses have many HR issues and situations that need to be managed: relating to compliance, reporting, benefits administration, etc.  Applications and services are available through e-Accounting that can give you the tools and resources necessary to provide high-level HR services for your clients - not just payroll and reporting services. Employee benefits programs are key to personnel retention - make your service the key to retaining good employees for your clients.

Sales And Marketing Assistance
Professional service firms require sales and marketing. The e-Accounting Center provides you with the tools, systems and services you need to help grow your business. Create efficiencies in sales and marketing where you don't have dedicated personnel by using Internet technologies and website services. We can help you create and manage client communications and opt-in e-mail lists, or direct you to associations and partners that can give you the individualized hands-on assistance you need..

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