The top 10 reasons to outsource your government contract accounting

When you receive a contract or a grant from the Federal Government, there are always lots of terms and conditions attached to these relationships.  One of the most onerous is related to how you do your accounting so the government can make sure it is getting the most favorable customer status (the best pricing).  In dealing with the Federal Government it is always pointed out that all of the terms, conditions, regulations and other items are publicly available.  This is very true.  What may not be obvious is that these terms, conditions and regulations are very intertwined and difficult to fully understand and therefore difficult for a small business to comply with.  When you compound this with the issue that a small business needs to focus on the core competencies to make the business successful, it becomes obvious that it might be not only a good idea but it could be financially proven to be the best decision to outsource routine tasks like compliance and accounting.  So what are the top 10 reasons that you should outsource your accounting?  This is our list, you may notice others:

1.  You are an expert in your field, not an expert in accounting

2. You are not an expert with the Federal Acquisition Regulations for accounting systems for government contracts &/or the Code of Federal Regulations for government grants

3.  You will spend less by hiring an expert in the field rather than to hire a bookkeeper or accountant and try to navigate the compliance landscape “on the fly”

4.  An expert doesn’t have to spend time trying to research and look up whether or not an expense is allowable or not

5.  An expert will know how to pool expenses and classify expenses to make it easier to do Incurred Cost Reports later, saving critical time and money at the end of the year

6.  An expert will know how to reconcile the labor continuously in a way that the government recognizes, saving an inordinate amount of time, money and possible findings at the time of audit

7. An expert will know how to process invoices properly to help ensure prompt payments from the government

8. To provide management with timely financial reports to facilitate decision making in the company

9. Accounting is an allowable expense for Federal Government contracting

10. Life is too short for you to do it yourself

Once you have realized it makes sense to outsource your accounting, you must then select the proper organization to help you.  You should look for one that specializes in this field.  Many CPA firms may have some employees that have done government contract accounting but do they do it all the time, every day?  Be sure to look for a firm like ReliAscent where this is what they do and are experts in this field.  This ensures that you will not only maintain compliance but you will end up getting the most for your money.  Let me know if you would like to discuss this further.