Keeping track of your school’s finances can be a full-time job. Transpose the wrong digits and you can open yourself up to the world of audits and endless trouble. Because your Montessori school is a small business, you must run it as such, and one of the most important tasks of operating a private school is bookkeeping.
Because it’s so essential to a healthy school, bookkeeping is not one of those tasks that you can relegate to the back burner. It requires constant oversight to ensure that all vendors are paid on time, all salaries are covered, all incoming monies are accounted for, and all taxes are paid. Your school’s financial health should be as solid as your commitment to childhood education.
In an effort to manage your school’s cash flow, you have four options:
- Choose someone on your staff with suitable skills to serve as a part-time bookkeeper
- Use an all-in-one bookkeeping software, like QuickBooks, Freshbooks, or Wave
- Hire on a full-time bookkeeper
- Outsource to a professional bookkeeping service
In this post, we’ll compare option #4, outsourcing, to the other three options to help you decide if contracting with an outside business is the right option your school.
Outsourcing Vs Part-Time Bookkeeper
What are the benefits of outsourcing when compared to hiring a part-time bookkeeper or assigning extra responsibilities to your current staff?
1. Keep Mistakes to a Minimum
Innocent mistakes are more prone to happen when you’ve appointed someone as the bookkeeper who’s not quite sure what they’re doing. Gotta love ‘em but not everyone is cut out for a life of accounting. It requires a meticulous attention to detail that you won’t get simply by cross-training your administrative assistant to handle the books. While they may be able to do a basic job of reconciling your finances, you likely incur a lot of mistakes in the process.
2. Make the Best Use of Your Budget
Bookkeeping isn’t profitable. It’s not about bringing in more revenue. It’s about keeping your business solvent. For this reason, it’s not the best use of your budget to hire someone solely for bookkeeping purposes. However, even if you hire someone on a part-time basis to take care of your bookkeeping, you’ll still spend a lot of money unnecessarily. On the other hand, outsourcing allows you to control costs because you’re only paying for the services that you need and when you need them.
3. Free Your Staff to Concentrate on Other Work
Asking your current staff to take on the added responsibilities of bookkeeping adds to their to-do list. One way to thwart productivity and efficiency is to force your staff to do too much. Instead of hiring people to wear multiple hats in your front office, you can focus on choosing people who can work as specialists. You want an enrollment manager, a registrar, or a volunteer coordinator, not a jack of all trades. When you outsource, your core staff can do their specialized jobs, and not worry about bookkeeping.
4. Work with a Skilled and Experienced Team
One of the biggest benefits of outsourcing is that you have access to a skilled accounting firm without paying the big bucks for it. You can take advantage of their bookkeeping experience. Their combined experience can protect you from financial disasters that the untrained eye would not be able to detect.
5. Enjoy 24/7 Service
Your outsourced bookkeeper can work while you sleep. Depending on what type of service you use and where they’re located, your service partner can handle your accounting needs both during and after hours.
Outsourcing Vs All-in-One Bookkeeper Software
What are the benefits of working with a bookkeeping service over a software?
1. Keep the Human Touch
When you work with a software, you rob yourself of the personal experience of dealing with another human. Your software won’t be able to answer your questions in real time as would an outsourced service.
2. Trust the Outcome
Bookkeeping software isn’t infallible.
That’s because it can only account for what you input into the system. If you transpose a number or forget to add a payment, your software won’t be able to account for human error. However, an outsourced bookkeeping service is highly likely to notice discrepancies and make the necessary adjustments.
3. Get Real-Time Answers and Reduce Frustration
When you inevitably encounter trouble with your bookkeeping software, there’s only so far that you can go with a frequently asked questions page. Instead of waiting for tech support to answer your email, you could pick up the phone to speak with your outsourced bookkeeper.
An outsourced bookkeeper may not be located in your office, but they can be reached whenever you need to work through an issue with a live human.
Outsourcing Vs Full-Time Bookkeeper
Should you outsource or work with a full-time, on-staff bookkeeper?
1. Grow With Your Needs
An outsourcing service is flexible enough to meet your bookkeeping needs. Require more or fewer services? Your bookkeeping partner should be able to work with you and your budget to create the perfect solution.
You can adjust the outsourced services to meet your school’s business cycle. In the months leading up to school admission, you’ll appreciate being able to upgrade or downgrade your service accordingly.
2. Reduce Costs
When you hire an accountant full-time, the numbers can definitely add up. You’ll find that outsourcing is a better use of your budget. One reason is that you pay a flat fee for only the services that you need. You won’t need to cover additional employee expenses and perks, including vacation time and health benefits.
Also, when you outsource, you won’t have to conjure up the office space for a new team member. You’ll also won’t need to find room in the budget to buy additional computer equipment, necessary software, a desk, and an office chair.
3. Team Vs. One
Partnering with a bookkeeping service has many perks. Perhaps the most notable is that you can work with a team of specialists to take care of your bookkeeping needs. You’ll likely not just work with one person, as you would if you hired an accountant on staff. Your budget can stretch further when you outsource to an entire team of accountant professionals.
4. The Service Holds Liability
One of the very reasons to outsource bookkeeping is because you’ll outsource your liability. When you work with a professional accounting service, it’s their responsibility to keep your books. If something is off, your bookkeeping service is held liable, not you.
5. Access to the Latest Technology
When you work with an outsourced bookkeeper, you can take advantage of the latest technology without actually have to update the systems yourself. The outsourced service should have the most up-to-date technology to facilitate your bookkeeping needs.
Outsourcing is a beneficial business practice for Montessori schools. For the reasons mentioned above, outsourcing your bookkeeping can free your time, your budget, and your peace of mind. If you’d like to learn more about Hubbli’s done-for-you school management service, book a consultation now.