Advantages of Using Outsourced Accounting Services for Municipalities

Advantages of Using Outsourced Accounting Services for Municipalities

Maintaining precise financial records for any organization should be a top priority, especially for municipalities and local governments. According to a Bloomberg report, the scarcity of skilled accountants has placed numerous municipalities in jeopardy of lagging in their financial reporting. Municipalities should consider using outsourced accounting services to ensure their finances are being handled efficiently and cost-effectively.

When Should Municipalities Consider Utilizing Outsourced Accounting Services?

Whether municipalities are looking to maintain their financial stability, avoid credit rating downgrades or are just trying to improve their financial reporting, there are many reasons why they may consider utilizing outsourced accounting services. Below are a few scenarios on what might spark an organization to explore these services:

  • Staff turnover or retirements of key accounting personnel. In the case that a municipality is experiencing an influx of transitions, outsourcing accounting services can assist by providing a seamless solution to minimize any disruption to financial operations.
  • Specialized experience is needed. Many municipalities may require assistance from a firm who has specialized experience in government accounting practices. Outsourcing accounting services from a firm with a high degree of knowledge can be a cost-effective solution to allow the municipality to allocate resources more effectively.
  • Limited financial resources to hire a full-time Chief Financial Officer (CFO). Not all municipalities may have the means in their budget to hire a full-time CFO. Municipalities experiencing this lack of a need can supplement current accounting staff with a CFO-level accounting advisor. An advisor can provide access to qualified and experienced professionals without the payroll costs associated.

What Are the Benefits of Using Outsourced CFO and Accounting Services?

Along with helping municipalities overcome challenges, outsourcing accounting services can provide many benefits for municipalities and local governments such as expertise, cost savings, timely and automated financial reporting and improved financial management.

Accountants with Expertise in Government Accounting

Accounting professionals who specialize in government accounting are well-versed in government accounting standards. They stay up to date with federal, state and local regulatory and compliance requirements which ensures that financial statements are accurate and comply with regulations.

Utilizing Outsourced Accounting Services is Cost-Effective

By municipalities outsourcing accounting services, they can avoid the costs associated with salary and benefits and the time related to training on governmental accounting. Municipalities only pay for the services they need, which can help reduce overall costs.

Apart from cost savings, municipalities can enhance their bottom line by utilizing outsourced accounting services through access to new funding sources. Outsourced accountants possess comprehensive knowledge about various federal, state and local grant funding opportunities that municipalities may qualify for and derive benefits from but might otherwise be unaware of.

Timely and Automated Financial Reporting

outsourced accountants can help municipalities implement automation techniques that will increase efficiencies and make sure financial statements are prepared accurately, swiftly and submitted on time. This method is used to reduce overhead costs related to financial reporting and is especially important for municipalities that need to report financial information to bondholders or rating agencies. Timely financial reporting can help maintain or improve credit ratings which can ultimately reduce borrowing costs for municipalities.

Improved Financial Management with Outsourced Accounting

Outsourced accounting services grant on-demand access to a team of experienced accountants who are thoroughly knowledgeable in financial best practices for local governments. They provide valuable insights into a municipality’s financial health which significantly reduces the amount of research time wasted by the municipality’s management. These insights help to identify areas where expenses can be reduced, or revenue can be increased. Accountants can help municipalities create data-driven, long-term financial plans and budgets. Municipalities will be able to make informed decisions about how to allocate resourced and manage finances effectively by having a clear understanding of their financial situation.

Outsourcing accounting services can provide numerous benefits for municipalities and local governments. By leveraging the expertise of experienced accountants, municipalities can reduce costs, enhance operational efficiency and access the latest technological advancements. By partnering with BSSF, municipalities can improve financial management, allocate resources effectively, and focus on their primary responsibilities of serving the community.

Contact the Brown Plus outsourcing accounting team today to get started today.

Posted In: Outsourced Accounting Services | Governmental Entities | Insights

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