Your business has a few options when it comes to its accounting needs but first it is important to understand how accounting plays a role in the success of your business. When you start a new business, you do so because of one of three reasons. The first one is because you want to make profits; the second one because you want to grow to a much bigger level and the third one because you want to give something back to your community by either employment or revenue. In all of those cases, accounting can make a difference. An outsourced accountant is right at the forefront.How Does Accounting Accomplish Those Goals?When you look at those three reasons to get in business, you may be wondering how an outsourced accountant can help you do that. First, an outsourced accountant will ensure that every transaction your business enters in is recorded when it happens. The accountant will also ensure that every transaction is grouped or classified correctly. Finally, the accountant will also give you every report and balance sheet that you need to understand the cash flow for your business. That information can help you take the right action at the right time when necessary.Difference Between In House And OutsourcedThere are a few differences when you compare an in house to an outsourced accountant. The in house accountant could be a person who is located in the same region your business is in. An in house accountant is also someone who is already under employment of your company so there is a contractual relationship between them and your business. The outsourced accountant is not under contract with your business, but rather with the company which will provide you the accounting services. The accountant when outsourced could in fact be in a different country.The Outsourcing CompanyWhen you use an outsourced accountant, you will probably be using an entire company. That puts a whole team at your disposal. This can be an incredible asset to a business owner because all types of accounting needs can be taken care of by using one company. Another benefit is that should one accountant take a leave, you as a business owner will not have to find someone to back them up. The outsourcing company would be doing that for you. Having the option to not have to look for extra coverage gives you more time to pay the most attention to your business itself.ConvenienceA lot of the outsourced accountant work is done in different countries but that does not mean that you will have to stay up at night to talk to them. The accounting companies will have a team to work 24 hours a day every day of the year. The other benefit is that all the work that you need for the next day can usually be done overnight. This is especially true of accounting companies based in India. Finally, hiring an outsourcing company can be cost effective because of the exchange rate.
With a movement towards globalization approaching, the change brought on by it can change how companies in the U.S. view their accountants. First, there are two types of accountants, financial accountants and managerial accountants. A definition of financial accounting, taken from Merriam-Webster, is the systematic analysis of information about the economic affairs of an organization for the use of persons outside the organization. Merriam-Webster goes on to explain management accounting as “the creation of reports for planning and decision-making”… “It’s aim is to provide managers reliable information on the costs of operations and on standards with which those costs can be compared, to assist them in budgeting”. The key difference to take away from these two definitions is that financial accounting provides information to people outside of the organization, and management accounting is aimed at helping managers within an organization make decisions.The U.S. becoming more globalized will increase competition for firms within the country, therefore making management accountants more valuable to firms. To understand what an increase in competition will do to U.S. companies and their accountants, one must first take a look at how companies in the U.S. see management accountants in comparison to another country. In a research article titled “Management Accounting Practices in the U.S. and Japan: Comparative Survey Findings and Research Implications (1991)” by M. Shields and C. Chow, notes the difference in goals set by U.S. and Japanese accountants. The survey suggests that U.S. accountants “emphasize the use of standards to control manufacturing costs after the fact”, while contrasting Japanese accountants use practices that look towards the future. This difference here lies within the goals set by the companies. While firms in the U.S. are looking at what they can do now to lower costs, Japanese firms are looking into the future to lower costs for products that might not exist yet. This type of thinking for U.S. firms is not acceptable, and the state that companies are in now is less than satisfactory because the current state of management accounting is in the wrong direction.Management accountants look toward the future, they set up budgets, forecast, and steer companies in the right progressive direction. In increased competition, especially for U.S. firms, companies will need managers that make the right decisions for the good of the company. In an article by B. Pounder, “How Globalization is Affecting U.S. Accounting (2006)”, Pounder states that one of the main reasons management accounting is obscure in this country is because American managers are more likely to make “gut feeling” choices (usually for personal gain) rather than making the choices that will be good for the company in the long run. This can be tied back to the research survey from Shields & Chow, looking at firms and their respective goals. It is more common for businesses in the U.S. to demonstrate action for personal gain than it is in Japan, and in an age of globalization and increased competition companies cannot survive with that type of mindset and framework.A report by N. Miculescu, “Current Trends of Production Cost Accounting (2011)”, Miculescu concluded that companies have an exponentially growing duty to find solutions as quickly as possible in order to keep up with this rise in competition due to globalization.The current state of management accounting in the U.S. rewards managers and puts the company as a whole in jeopardy, and with a rise in competition approaching is it in firms’ best interests to employ management accountants that make decisions for the best interest of the company.
Anxious parents of school going children often wonder which career is the best for their children. When you consider various factors, it would appear like a career in accounting holds out the best promise. In the US, accounting jobs are likely to be more numerous, at least in the near future, compared to other jobs. According to a report done by the Bureau of Labor and Statistics, accounting jobs are likely to experience robust growth of about 22% between the year 2008 and the year 2018. That is much higher than the growth expected for other jobs, which stands at just 17% for the same period. The percentage growth for accounting jobs translates to a healthy 280,000 new jobs in that period.There are several factors that can account for the higher-than-average growth expected for accounting jobs. In a world where financial systems are constantly evolving, both businesses and individuals alike are likely to require the services of accountants to keep track of their money and comply with government’s fiscal regulations. Accountants, however, do a lot more than just keep company books; they advise companies on various ways to deploy their cash too.In the modern globalization arena, accountants play a central role. A financially flatter and more intertwined world definitely means that there will be a greater demand for more expertise in international trade as well as other related aspects such as corporate mergers and acquisitions. That is one big reason the accounting jobs are enjoying boom time and large accounting firms are busy hiring more accountants.The accounting profession is highly flexible. Accountants can find work with both large multinational corporations and small bookkeeping operations alike. About 8% of accountants are self-employed. Lucrative accounting jobs such as public accounting require 4-year degrees and a CPA designation or advanced degree. This takes years of hard study.Switching CareersPerhaps one of the biggest factors that might favor a career in IT instead of one in accounting is ease of career change. Accounting is not suited for mid or late career changes. This is because a person with just a few working years left is not likely to recoup his or her investment if he or she decides to trade careers. For late to mid-late career changes, a person would be better off looking for IT jobs. The growth prospects for IT jobs are better than those of accounting jobs and stand at 30% from the year 2008 to 2018, according to the BLS. The field of IT is highly versatile and one can enter the field from different directions ranging from a help desk to a job in project management or analysts job. The IT space also better accommodates different levels of education compared to accounting.To make a career switch to IT from accounting, online training is usually enough. The person who makes such a switch can easily leverage this fact to his or her advantage. This is because employers are likely to view such a person as someone who can easily adapt to new environments. That is perhaps the most important skill an employee can have.