In due diligence, an IT business lost a $2 million enterprise transaction which it had signed. Unconciled accounts, a jumbled financial picture spanning three years, and no audit trail were discovered by the customer. The deal collapsed in less than 48 hours. The cost of one failure in the budgetary control could not be less than a year of marketing.The role of Finance & Accounting Services could not be over-emphasized to IT organisations aiming growth.
What Does Audit Readiness Actually Look Like for an IT Business
To be audit ready, it is important to keep your books in order, at all times, not just when an audit team comes to visit you.
It includes a clear chart of accounts, which is reconciled with bank statements, spending rules, how to classify employees as either contractors or as employees, and how to properly recognize revenue under the ASC 606 or IFRS 15. IT companies only tend to resolve these when they occur. So, the cost of it being fixed is three to five times higher than the prevention cost.
Engaging in Finance & Accounting Services would mean having a team of workers who would maintain this discipline throughout the year rather than and during the tax season.
How a SaaS Company in Texas Fixed 18 Months of Messy Books Before Series A
A SaaS startup of 40 employees was about to announce a SaaS funding round dubbed Series A funding. Previously they had used spreadsheets and basic software to maintain a record of their accounting.
When they Hire Finance & Accounting Services firm, the founding team found the following: 14 months of incompatible transaction records, miscapitalized expenditures to develop software, and missing income reflected in the generated revenue when they enlisted the services of a finance and accounting firm.
11 weeks after they Hire Finance & Accounting Services agency had fixed the finances, reconstructed the chart of accounts, and put adequate reporting on SaaS metrics in place. Two months later the business collected 28 million dollars of its Series A. It was a subsequent round of financing that proved to be more successful than earlier. Full disclosure of finances was one of the major factors being examined by the investor.
Why IT Companies Choose to Hire Finance & Accounting Services from India
One of the reasons is the cost. The primary reason is making ready access to professionals.
Chartered accountants and certified public accountants with experience in a variety of fields and regions are what you can expect when you Hire Finance & Accounting Services from India . Due to their extensive experience with IT customers in the US, UK, Australia, and Canada, many Indian accounting companies are well-versed in multi-jurisdictional compliance.
You can save a mean of 40-60 percent without having to reduce the quality. This can save up to 50 people, on an IT firm, a sum of up to $80,000 to $120,000 per year in savings.
What to Look for When You Hire Finance & Accounting Services Company
Information technology business models are not comprehended by every company. Determine directly whether or not they have worked experience within software as a service company or managed service providers or IT consulting firms.
You are to be looking at the candidates with the track record of success in areas like multi-currency reconciliation, equity and ESOP accounting, R&D tax credit paperwork and revenue recognition standards. Accounting is not the only aspect of what a high-end finance and accounting firm do. They must also be in a position to give advice at the CFO-level.
Audit preparedness is more than just a compliance need; it’s a growth asset. The ability to close contracts faster, raise capital faster, give confidence to partners faster and many more are the benefits of IT firms that maintain clean and open finances.
You can change a problem into an opportunity after they hire Finance & Accounting Services company. The first companies to figure this out realize their scaling with minimal to no resistance.