As a new company starting out or a small business expanding, you may wonder how many employees you will need for your accounting department. You can compare your company to others in your field and of the same size, but many factors go into deciding what people you need to hire.
Factors to Consider for Your Accounting Department Staff
You need to consider several criteria when looking into developing or expanding your accounting staff. Here area a few things to look at before you make a decision.
- Your industry or field – This will partially determine how many people you need on staff based on how much income and expenses they will have to deal with on a weekly or monthly basis.
- Your clients – If you work with other businesses, you may need to submit more detailed records or paperwork than with consumers.
- Billing arrangements – You will need fewer people to manage your accounting if you operate on a cash-only basis than if you have revolving accounts.
You will need to look at not only where you are today in your business but where you plan to be in five or ten years. It is much easier to train staff as you go, rather than making a complete change and expecting them to learn everything at once.
Today, you may operate on a cash-only basis, but you plan to expand your customer base and offer credit or revolving accounts. If you wait until that happens and expect your staff to understand the new procedures immediately and handle all of the new work until you hire help, you will have many issues. Instead, project the changes your business will make with basic estimates of time and hire accordingly to handle the changes as they are implemented.
The Individual Roles of the Accounting Department Staff
When a business is small, they may only need a bookkeeper to handle their accounting work. Often they will use outside bookkeeping services rather than pay a full-time employee.
As the company develops and expands, they may need to divide payments in and payments out into two jobs. You will also see the tasks expand for your accounting department when you hire other employees since they are typically responsible for payroll and taxes. They may handle other Human Resources tasks if you don’t have a department or employee for that position. They have to file tax forms and other paperwork for each new hire.
Changes in Procedures
As your business grows, you may buy new software to make processes more automated. This can have the effect of either reducing or expanding your accounting staff. Much of it will depend on if your customers want an increase in documents to go with their invoices or if you need more reports to track expenses or profits.
If you get to the point where you have investors in your company, they will want detailed reports on how your company is doing financially. They will require more complex accounting procedures to detail return on investment and cost-to-income ratios along with any specialized reports your company may have. A single bookkeeper will not be able to handle all of these tasks alone.
Your Options for Your Accounting Staff
You have two basic options for building an accounting department. You can either hire a company that does bookkeeping services or you can hire your own full-time employees. You can begin with one and switch to another as you grow or you can decide from the beginning which will benefit you the most.
Many business owners think that an outside company only does simple bookkeeping services. However, they would be surprised to find that they can generate many reports and keep track of complex expenses and accounting procedures.
Bookkeeping companies hire certified accountants as well as traditional bookkeepers. They provide the level of expertise that you need while not forcing you to pay more for expertise your business does not require. They will also handle payroll tasks and any other areas that a traditional accounting department would be in charge of.
Ezcfo is an outside accounting and payroll company that works with businesses of all sizes. They can handle simple cash-only tasks or complex revolving accounts, and they can generate any reports that your business needs. They can work with your business as it expands so that you do not need to hire your own staff in the future. They provide services for all financial areas that a business would need, including payroll and taxes.