In the world of business, trust is the most expensive currency. Business owners, especially those who are new to being in charge of a company, face many threats from dishonest actors. Whether it is disloyal competition, various swindlers and fake investors, or just plain old greedy employees, the risks of placing the trust in the wrong people cannot be overstated.
Virtual business accounting services are one way to decrease these internal risks. Virtual accounting is the umbrella term for any form of bookkeeping that is not done in-house for a company. If you want to create a safe environment for your business to grow, it is one of the tools that can help you decrease risks.
When hiring an accountant or a bookkeeper, you as a business owner are placing the most sensitive part of your operation in someone else’s hands. If you misplace your trust, you will become a part of the ever-growing statistic of accounting frauds. The risk exists because you are placing your trust in a single person, which can be a point of failure.
When it comes to virtual services, you can be confident that never will there be a single person with complete and unsupervised control of your accounting records. Many such companies have very stringent checks and balances to ensure that your business is protected from fraud. If you are an SME or some educational institution, it can be a considerable expense to have an equivalent level of protection.
For example, private schools, because every charter school law does not require it, but as much of their funding into teaching staff cannot properly supervise their accounting staff.
Virtual Accounting Services Rotate Staff
The primary way the virtual accounting service providers keep their employees honest is by rotating them regularly through their clients. While some specifics of accounting can differ from client to client, it shouldn’t matter anyway. If, as a business owner, you have an in-house accountant, you should be aware that the person who controls the books also manages the company’s cash flow.
And the temptation can be a big one; after all, you don’t have time to constantly look over the shoulder of your accountant and keep them honest. One of the red flags that something fishy may be going on with your books is when an accountant becomes an irreplaceable asset. Accounting is not rocket surgery, and this situation can mean that you have become a victim of fraud.
With virtual accounting, this can never happen.
No Paper To Steal
One of the main ways accounting frauds at the expense of business owners happen is through paper checks and cash. A little bit here, a little bit there, a review on one fake company cashed from time to time, and so on. Virtual accounting is, in essence paperless, there is nothing to be stolen or forged. All checks and money transfers are done electronically and with authorization by you.
Another source of fraud is unauthorized access by a third party. People are careless and often busy; locking drawers and computers can sometimes be too arduous to bother. Because a virtual accountant is not at your place of business, there is no way that any interloper into your offices can access any of the sensitive data; it is not there.
You Are Protected
Even in the worst-case scenario, that you become a victim of fraud by a malevolent employee of an accounting services company, you are still protected. The chances are meager, but the best companies have liability insurance, which protects you from any potential losses caused by accounting fraud.
When doing business, small business owners often neglect the risks of accounting frauds they are exposed to. Companies often place trust in people they shouldn’t, primarily when they cannot provide proper oversight of employees placed in positions that enable them to harm. Virtual accounting doesn’t suffer from such risks and even gives you insurance against such possibilities.