June 17, 2024 Why Outsource: Avoiding the Scramble of Tax Season

Outsourcing accounting functions can set manufacturing businesses up for success when the next tax season rolls around.

By Gregg Genovese, Partner and Practice Leader for the Outsource Accounting and Finance service line at The Bonadio Group

Only one in three small business owners feels prepared for tax season, according to recent findings from Adobe, highlighting the stress many manufacturing business owners encounter each spring making sure they have all the records and documents they need for filing.

Finding ways to streamline the process is top of mind for many manufacturing businesses. With the scramble of the 2024 tax season behind us, making the decision to outsource business accounting now can help promote a seamless filing process next year. 

Outsourced accountants specializing in accounting and tax services are well-versed in laws, regulations, and industry-specific requirements relevant to manufacturing businesses. They stay updated on changes in tax legislation as well as generally accepted accounting principles and can ensure that manufacturing businesses remain compliant with all applicable laws and regulations, minimizing the risk of errors or omissions on tax returns while helping to eliminate messy and inaccurate records.

The main benefits of outsourcing for manufacturing businesses can include:

Saving time and reducing stress for yourself and your staff.

Outsourced accountants can streamline the collection and organization of financial data required for tax preparation. They implement efficient systems for gathering relevant financial information, such as income statements, balance sheets, expense records, and depreciation schedules. This allows manufacturing businesses to focus their time and resources on core activities such as production, innovation, and customer service. By delegating financial tasks to external experts, business owners and managers can devote more attention to strategic planning and operational excellence, leading to improved productivity and competitiveness in the market.

Accessing expert knowledge and ensuring accuracy in your financial records.

Accounting firms specializing in serving manufacturing businesses often have a team of experienced professionals with specialized knowledge in manufacturing accounting practices and regulations. Outsourcing provides access to this expertise, ensuring that financial tasks are handled by professionals who understand the intricacies of the manufacturing industry, including inventory valuation, cost accounting, and compliance requirements.

Streamlining your tax preparation process with organized and up-to-date financial data.

Outsourcing accounting ensures that financial transactions are recorded promptly and accurately. By having access to up-to-date financial reports, manufacturing businesses can gain a clear understanding of their current financial position, including revenue, expenses, cash flow, and profitability. Timely financial reporting allows for proactive decision-making rather than reactive responses to financial challenges.

Focusing on growing your business and stronger financial outcomes.

Outsourcing accounting services can often be more cost-effective than hiring in-house accountants. By outsourcing, businesses can avoid the expenses associated with recruitment, training, salaries, benefits, and overhead costs like office space and equipment. Additionally, outsourcing allows for flexibility in scaling services up or down according to business needs, helping to control costs more effectively.

Minimizing the risk of errors and potential tax penalties.

Compliance with tax regulations, financial reporting standards, and industry-specific requirements is crucial for manufacturing businesses. Outsourcing accounting to professionals who stay abreast of changing regulations and best practices helps mitigate the risk of errors, penalties, and non-compliance. Accounting firms often offer assurance services, such as audits and reviews, to help ensure financial accuracy and regulatory compliance.

Staying informed about tax regulations and changes, keeping you compliant and prepared.

Accounting firms specializing in serving manufacturing businesses often have a team of experienced professionals with specialized knowledge in manufacturing accounting practices and regulations. Outsourcing provides access to this expertise, ensuring that financial tasks are handled by professionals who understand the intricacies of the manufacturing industry, including inventory valuation, cost accounting, and compliance requirements.

Gaining insights into your business’s financial health to make informed decisions.

Outsourced accountants can conduct detailed cost analyses to identify cost drivers and inefficiencies within the manufacturing operations. By understanding where costs are incurred and how they impact profitability, businesses can implement cost reduction strategies, such as optimizing inventory management, negotiating better supplier contracts, or streamlining production processes. These insights empower businesses to make decisions that maximize cost-effectiveness and improve overall financial performance.

Overall, outsourcing accounting offers manufacturing businesses a range of benefits, including cost savings, access to expertise, increased focus on core activities, compliance assurance and error mitigation. By partnering with a reputable accounting firm, manufacturing enterprises can optimize their financial management processes and drive sustainable growth. Working with the right people now will help ensure an efficient filing process and set businesses up for success in 2025.

Gregg Genovese is a partner at The Bonadio Group and the Practice Leader for one of the firm’s fastest-growing service lines, Outsource Accounting and Finance. Through this service, he helps numerous organizations across all industries achieve success by taking on the financial burden businesses face. Through proactive accounting solutions and state-of-the-art technology, Gregg provides high-quality customized options to meet the demands of its business, resulting in growth, improved profitability, and risk reduction. For more information about The Bonadio Group, visit www.bonadio.com.

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