What is the real cost of hiring and on-boarding new accounting personnel? A lot more than you probably realize. What are the hidden costs beyond the agreed upon salary? Here's what you can expect.
The Hidden Costs Your Startup Simply Cannot Afford
As we approach the third decade of the 21st Century, there is still a prevalent tendency to default to 20th Century business models among today’s business leaders. It could manifest in the do-it-yourself model or the hiring of in-house personnel to handle all aspects of the business. Outsourcing often comes as an afterthought or after the options above have failed.
DIY solves itself…eventually
“It’s easier to just do it myself.” Entrepreneurs often fall prey to this idea. But the hours in a day are finite and business leaders soon find that more pressing priorities require their attention. Other tasks, keeping up with accounting duties for example, fall further and further down on the “To Do” list.
“Let’s get someone in here to take care of this.” Maybe at the urging of the board or maybe because of the growing stack of neglected paperwork, the moment of truth arrives and it’s clear you can’t go on like this. You pull together a job description and post it online.
There are many factors that are in play in today’s job market that may keep the perfect candidate from finding you, but let’s just assume that you sift through resumes, conduct interviews, make an offer, and onboard a new employee.
The cost of this new employee goes well beyond the agreed upon salary. Speaking of salary, here are some salary ranges pulled from Indeed.com for accounting positions in California:
- VP Finance/CFO – $145,000 – $250,000
- Controller – $150,000 – $175,000
- Accountant – $55,000 – $70,000
- Bookkeeper – $30,000 – $55,000
But wait…there’s more
Tack on to the salary the cost of benefits and personal time off (PTO). The Bureau of Labor Statistics calculates an additional $13,000 per employee once the cost of health insurance, PTO, payroll tax and worker’s comp, and retirement benefits are factored in.
And it doesn’t stop there. Are your employees expected to work at your office? What will be the annual cost of office space, equipment, supplies and administrative support (HR, IT, etc.)? These costs could easily tally to another $17,000 per employee.
We’ll stop there, though this is not an exhaustive tally.
Outsourcing yields greater value at a lower cost
Greater value, deeper expertise: that’s why many CEOs and entrepreneurs are bypassing the 20th Century business models and opting for outsourcing in many areas of the business including IT, marketing, accounting, and more.
Edward Thomas Associates offers premier accounting services. We understand the needs and pressures of startup organizations.
For a monthly fee you receive a team of accountants with different experience and skill levels to manage your accounting. When you need CFO-level counsel, you have a CFO-level professional to guide. For the tasks that don’t require a senior accountant or above, a bookkeeper will be assigned. This helps to keep costs low.
You can address the priorities of the business confident that your books are in order and that you have the most accurate data at your disposal. You’ll receive your financial statements as scheduled. You’ll have continuity in the business – no disruption due to PTO or employee turnover. Your board will love the fact that the financial accounting function is being tended to by professionals with Big Four accounting experience.
Why not solve your accounting needs once and for all? Click here to contact Edward Thomas Associates.