Last updated on September 27th, 2024

In the ever-evolving business landscape, local unions are increasingly recognizing the need for strategic financial management. One potential solution that’s gaining significant traction is outsourced accounting.

Access to expertise is the most appealing advantage of outsourcing accounting. Accounting firms are equipped with seasoned professionals who are well-versed in financial regulations, tax laws, and financial management best practices, and they stay up-to-date on changes and evolving trends. These professionals can provide advice on financial decision-making and ensure compliance with tax regulations, minimizing the risk of costly errors and penalties.

Cost savings is another major benefit. Hiring an in-house accounting team can be financially draining, with costs associated with recruitment, training, salaries, benefits, and office space. In contrast, outsourcing accounting offers a flexible pricing structure, allowing unions to pay for the services they need when they need them. This may reduce overhead costs.

By delegating financial management tasks to outsourced accountants, union leaders can concentrate on their primary roles, such as advocating for members’ rights, negotiating collective agreements, and organizing campaigns. What’s more, they get peace of mind that all accounting-related and regulatory requirements are covered.

Outsourcing accounting also provides an opportunity for enhanced data security. Reputable accounting firms invest in state-of-the-art security systems to protect data from unauthorized access and cyber threats. This level of security may be hard to achieve with an in-house team, particularly for local unions with budget constraints.

There’s also a technology advantage that comes from outsourcing. With an outsourced accounting firm, local unions can benefit from the use of cutting-edge technology. Most accounting firms employ the latest accounting software and tools, facilitating efficient, accurate, and timely financial reporting.

In addition, while in-house accountants can resign, fall ill, or go on vacation, leaving the union with a void to fill, accounting firms usually have staff on hand to ensure uninterrupted service.

What does outsourcing accounting entail for a local union? Initially, the union would need to define exactly what it is looking for in an outsourcing arrangement. Armed with this information, it may issue a “request for proposal,” asking potential firms to provide detailed information about their experience, approach to the work, timeline and costs, the team who will support the client, references, and more.

Beyond the proposal, the local union should meet face-to-face with representatives from the contenders to get answers to additional questions, clarify any arrangement, and ensure fit.

The outsourcing firm selected for the engagement then takes over the financial management tasks, which may include bookkeeping, payroll processing, tax preparation, financial reporting, internal and external auditing, advisory services and strategy setting, and budget planning and monitoring.

The firm should keep you informed through ongoing communication and may even provide value-added resources and information to support your union’s financial compliance, performance, and success. As your local union’s accounting requirements change, you can adjust your outsourcing arrangement to meet evolving needs.

For over 55 years, RBT CPAs has been providing accounting, advisory, audit, compliance and tax services to organizations and businesses – including local unions – across the Hudson Valley and beyond. If you’re interested in learning more about how your local and RBT CPAs can be Remarkably Better Together, click here to request an introductory meeting.

RBT CPAs never offshores work outside of the U.S., so you always know who is handling your financial information.