News & Insights
Three Biggest Challenges Facing Government Financial Leaders
April 14th, 2021
By Steve Kirinovic |
Accounting & Outsourced Solutions |
Outsourced Accounting Solutions
Government financial leaders must balance meeting the needs of the community while meeting the municipality’s budget constraints. The accounting department plays a critical role in any government’s success; it’s an area with high demands and, in many cases, limited resources. To see success, officials must bridge the gap between available resources and intelligent, data-driven decisions, while lowering costs and maximizing the potential of their precious financial resources. Outsourced accounting services can be a tremendous resource in helping officials meet their goals.
Below are three important benefits outsourced services can provide:
Maintaining strong internal controls in a remote environment and as we return to normal.
The accounting processes and internal control structures put into place before 2020 were not created with a vision of a pandemic environment. With reduced staffing, remote work environments, individuals not wanting to return to the on-site work scenario, and many other hurdles, the procedures and controls will more than likely be substantially different going forward than initially designed.
The modern municipality needs the flexibility to regulate the payroll expense of a diverse and knowledgeable workforce. With the utilization of highly specialized individuals if/when you need them, officials can access high-level problem solvers when they need them to supplement employee knowledge and experience. Outsourced solutions can pay considerable dividends in these situations. A trusted advisor from the outside that can evaluate internal controls and offer a recommendation of preventative or detective controls that can be added to the current system or inserted into your existing systems would be invaluable.
The municipality can bring in outsourced resources that can add additional benefit by assessing whether current policies/procedures adequately protect your organization. The trusted advisors will have the workforce and resources you need, on short notice, to assist in implementing new or modifying existing internal control systems. The assistance can be for the short-term to implement new processes. Once the new systems are in place, the engagement can conclude or if assistance is needed on an ongoing basis, the entity can engage the long-term trusted advisor. This immediate, positive impact will firm up internal controls in the short and long term and provide strong internal controls well into the future.
Finding and retaining high-quality team members in a very tough job market.
Lack of adequate staffing is usually one of the top pain points seen in all industries. Governmental employers are certainly not exempt from this issue. For anyone who has been actively involved in the Governmental arena for the past 20+ years, it has unfortunately seen governmental salaries not keeping pace with other markets. The once-better benefits offered by governmental entities have been softened in many instances. This reduction in benefits has, in some instances, lessened and attractiveness of these positions. This is where outsourced services can come in to fill a needed role.
As governmental financial experts know, there is a difference between a generalist accountant and an experienced accountant specializing in governmental accounting. Governmental accounting takes a unique skill set that isn’t easily obtained. By having a team of trusted advisors with experience and understanding of governmental accounting in your corner, a governmental entity can access qualified and experienced individuals and stay within budgetary limits.
When turnover occurs in a position filled by an employee, the process of interviewing, hiring, and training is very time-consuming, but through contracted advisor governmental services arrangement, a group of trusted advisors are on your team. You have the resources of a team of people to fill a gap if someone is on vacation, sick, separates service, etc. It is simply a phone call away to have the outsourced governmental team member with the appropriate level of experience stepping up and taking over. Outsourced solutions give seamless continuity that you don’t get with an employee.
Increased demands of more time and added services with stagnant or reduced resources available to meet those demands.
More and more tasks are expected of a municipality staff, another compliance report, meetings, and required filings. The demands continue to grow for your limited staff to accomplish required tasks and meet the community needs within limited resources. Add on the ongoing pandemic and eventual recovery and we have a magnified time crunch and added budget challenges. It is unlikely to have the ability to afford to ramp up staffing from an employee perspective while adding long-term costs to the equation, but the work must be done in the short term.
When faced with this situation, many financial leaders stand at the crossroads between hiring of additional accounting staff with the accompanying startup costs or directing the municipality toward an outsourced solution with low startup costs, controllable and expected ongoing expenses. The “a la carte” opportunities that arise with outsourced accounting solutions for governmental entities are many. An experienced, trusted advisor will offer an extensive menu of services to take advantage of when or if they are needed and not incur any expense for them when the service is not utilized. This pay as you need/go solution fits well into entities where workflow ebbs and flows. Rather than have an employee’s full costs of salaries, benefits, training, technology, etc., those costs are covered by the outsourced provider and the municipality simply pays an hourly rate for hours used.
There are many other positive impacts that outsourcing financial services can bring to a municipality and every situation is different. It may be as easy as enlisting a trusted advisor in an outsourced accounting capacity to provide much needed resources to allow for a positive outcome to a difficult situation.
Interested in Outsourcing?
Our dedicated Governmental team provides day-to-day commitment from partner-level to staff. We aim to support governmental officials to bridge the gap between available resources and the ability to make smart, data-driven decisions the future of your municipality hangs on. We can help you lower costs, minimize disruptions to daily operations and maximize the potential of your precious financial resources.