why do big companies get their accounting done by accounting firms when they could afford to do it on their own?
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If you are a big machine shop, like you got thousands of employees from machinists to welders,technicians for installing, and engineers. It makes sense to keep people that you actually need to run your primary operations in house. This was you can adjust expenses related to those easily and manage budgets.
When your operation has auxiliary operations, such as cleaning of social spaces, accounting… etc. Things which aren’t required for the primary operation, but support it. It is simply easier to buy those services from outside, this way you don’t need to think about them. You can just put a lump sum of money and that stuff gets deal with.
It really boils down to, do you want to manage your own accounting in house? Often the people at the top don’t have the skills to do such things, so you’d need to get someone who does and from this form a whole new department.
Also accounting services provide other services, not just accounting. My father is accountant and financial advisor specialised in entrepreneurs and small companies. He offers a service, which is really popular among immigrant entrepreneurs, where he helps them with everything from accounting to dealing with officials, and he comes to you when you need him and walks you through the papers basically by holding your hand through the whole process.
Bigger companies might want services like tax law related subject, or someone specialised in government subsidies, or foreign trade. Basically instead of hiring an expensive specialist to deal with things in-house, you can hire one to use when you need it. You might not always need someone who knows how to navigate government subsidies, so no point hiring one.
Also another benefit is that a whole firm doesn’t go on a leaver, vacations, get sick, at once. Your in-house accountant(s) might. A outside accounting firm will keep doing your accounting tasks by allocating workforce internally for it. Again, so you don’t need to deal and manage with it.
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