After having passed your CPA exam, getting CPE credits is a way to keep updated with your career growth in the profession. It inspires you to stay active in the Accounting and finance community and keep up with new advances and reporting necessities in the industry. CPE credits are required to meet your state board of accountancy’s necessities to renewal CPA license. A Continuing Professional Education (CPE) is required for CPAs to maintain their professional proficiency and provide quality accounting services.

Types of CPE Credit?

Group A: These credits are basically allied with domain related activities and are correlated to the area governed by extensive domains.

Group B: Credits are linked to knowledge sharing and professional development to improve your overall education, ability, specialized skills, or knowledge external of the credential’s precise domains. CPE is likely to meet your state board’s necessities for CPA license renewal, as well as for meeting confirmation prerequisites for any enrollment affiliations and other expert accreditations, such as the CMA or CFP®. Whether you’re a CPA professional or starting your career, you’ll appreciate the below tips for CPAs to pursuing education credits.

1. Attend live seminars, conferences, or Webinars.

Participates in Webinars, Seminars, and Podcasts can be the most convenient and best way to get CPE credit. Webinars can be live or recorded, but they are well suited for CPAs who enjoy the computing practice. Attending Seminars and conferences are also pathbreaking for CPAs who want to balance networking prospects parallel with learning. Thes live events usually facilitate self-study courses that are suitable for busy CPAs who desire to study during off-hours.

2. White Paper Reading

Reading white papers that are published on authentic websites are also one of the means to earn CPE credits. However, one has to write a short summary of contents that studied, with the details of the website. Another factor is that the website needs to be reachable without any restraint and also be having content approved by the governing bodies that enable CPE. Through such reading, only “Group A” credits can be earned.

3. Becoming an Education Volunteer

CPE Credit can also be earned through attending and volunteering public and government sector organizations. A volunteer needs to keep a signed letter of the particular organization which indicates the volunteers’ working hours performed related to the credential dominion. Appearing and volunteering seminars on contemporary topics such as artificial intelligence, cyber security or information systems can help you earn “Group A” or “B” CPA credits.

4. Attend a Vendor Presentation

Attending a presentation related to educational aspects and regarding cybersecurity methodology, information technology or practice is a way to earn CPE credits. There are numerous CPE enabled vendor presentations happening at many places either in networking events or online but it should be ensured that any pure sales presentation are not considered for CPE credit. The regulatory authority NASBA keeps track and manages each such presentation and its contents are usually moderated before being published. 

5. Security book or article publication

 Publication of a self-written article such as security book  CPE credits are awarded on the consistent basis. If it is the first publication in a magazine or journal, please botrsure that article should be related to the credential domain. Keep in mind that “Group A” credits can be earned through this method. The best place to get CPE credits is the National Association of State Boards of Accountancy (NASBA). With filters including subject area, credit hours, the search tool provides a wide-ranging list of courses, with CPE finance training, NASBA is one national association that is capable of awarding CPE credit(s).

The good thing is there are many free options for earning CPE credits in NASBA’s list You have to fully recognize the requirements to escape having your credits banned. One of the easiest ways to earn CPE credits for free is to install some podcast apps on your smartphones or tablets and subscribe to several podcasts that are associated with your certification. CPE credits are open through a variety of organizations, including staffing and financial companies, educational institutes and industry associations.

Also Read: How we helped Start-up Accounting firms to mitigate operational challenges?

Overview

One of our client completed his CPA and was planning to start his own Tax and Accounting & Bookkeeping firm. At present, they are well established and offering services to small and mid size businesses. Their major clients belongs IT, Banking and Finance, Restaurant and Hotel industry. They also offer wealth management and tax planning service along with other services.

Business Challenges

Initially our client has started his firm from his home, alone. He use to meet the clients at their workplace or restaurants or some other place. When work started flowing in the firm following are the some issues they were facing:

• Space Management: The physical office limitations dictating the inability to expand and hire more staff was having a direct adverse impact on their business and revenue generation.
• Funding and Financing: Like every start ups  he was also had a limited capital to invest in own practice. With it there were always a fee Pressure for start ups too, revenue model was also not accurate.
• Qualified Staff and Their Training: He faced a consistent problem in getting qualified and trained staff because of funding and financing and space management. Because of Higher Attrition rate and Staff Turnover Ratio he ended up spending tons of time behind training people and kept away from him focusing from core business functions.
• Quality and Efficiency: He wanted their staff to add value to their current clients and to grow the business organically through cross selling and referrals but they were already unable to meet deadlines and produce accounts on schedule during peak periods to an ever expanding client base. Because of lack of trained staff, they often failed to provide quality services to their clients.
• Business Development: Business Development also became a Big challenge for them because they were not able to focus. They had more operations related issues to worry about than focusing on getting new clients. The speed of getting new clients also considerably decreased which affected their profitability badly and put the business existence in danger

Having said all these, they badly needed to identify a solution which would enable them to achieve their ambitions while minimizing expenditure and at the same time make their business more efficient. In the absence of a dedicated and qualified accounting team, their operation faced huge challenges in controlling costs and maintaining efficiency. Their requirement in their approach to Entigrity was to reduce their operation cost and they needed qualified accountants who would be able to provide a top quality services plus have the ability to liaise with their widespread offices by telephone or written correspondence.

How Entigrity Helped
 

We undertook and in depth study of their systems and document procedures and produced a detailed plan outlining all the tasks. After careful consideration the client decided to go with remote Employee model with Entigrity. They were hesitant doing so but we were able to win their confidence through trial run. We firstly allowed them to concentrate on business development and client retention activities; and secondly, provided well trained Staff Accountants, Accounts Senior, Accounts Manager which they required at a lower cost base, without the physical office space and associated overheads. It helped them to a great extent reducing their operations cost. Since we were successful in providing a strong team of accountants, it eventually disappeared quality and efficiency issues.

Our plan of actions focused on a number of areas which included:

• Create a strong team of qualified Staff Accountants, Accounts Senior, Tax Associate, Tax Senior and Accounts Manager and train them on accounting and bookkeeping aspects
• Streamlining the accounting process with new process controls for seamless accounting
• Created Standard Procedures Document detailing all processes for training and process improvements
• Setting up KRA and KPI for individuals and teams to achieve optimum quality and efficiency
• Developed a reporting structure for timely delivery of data and reports

Read E-Book: BEST TOOLS FOR REMOTE WORKING

Off-late the qualification of CA has started getting global recognition considering the competitiveness and curriculum. ICAI, Institute of chartered accountants of India, is the central body which manages the profession of CA. Considering the potential and scope of the International Taxation and Accounting, IFRS, etc, ICAI has introduced many course on International tax and accounting practices, IFRS, International Taxation etc which CA has to undergo. Much recognition for CA Qualification is due to the fact that the CA course has been able to keep pace with changes in global industry scenario. CA has declared to be equivalent as CPA of US and ACCA of UK.

As professional employee Chartered Accountants work as Finance Managers, Financial Controllers, Financial Advisors or Directors (Finance), , Investment Bankers, CFO’s and oversee the finances in the day to day management of companies. Their main areas of work include Accountancy, Auditing, Cost accountancy, Taxation, Investigation and Consultancy, Internal Control, Financial Management, Compliance management etc.

Competitive Exams

3 Level Exams

There are 3 levels of exams before the get the degree.

• Common Proficiency Test (CPT),
• Integrated Professional Competence Course (IPCC)/IPCE,
• Final Exam.

Which in aggregate take around 4.5 to 5 years of time post the higher secondary education. Thus pursuing a rigorous 5 years academic course.

3 Years of Rigorous Internship in Public Accounting firm :

It’s is mandatory for each student pursuing CA to undergo 3 year of full time practical internship at an accounting firm, hence this allows students to work on real assignments and gives on job learning opportunities. So when a candidate become CA he should be considered as an professional of 3 years of work experience in accounting firm. There are a few pre-requisites (exams, orientation program, training) that a CA student should meet before starting the internship.

6%-8% of Exam Clearance Ratio

As per the statistics, CPA’s passing rates of 2015 on an average of above 50%, and when the same is comparted to 78,000 students appeared for CA final exam in 2014, only about 5,500 could pass. i.e. 7%. In 2013, it was about 4,000 students passed out of 60,000. i.e.6%. Hence the competitiveness is very high, so the talent which comes out has undergone tremendous amount of toil and hardwork. Also one another interesting statistics is that 98% Indian students appearing for CPA’s pass the exams as compared to the national US average of about 50%.

Subject

The CA course is designed to combine theoretical study with practical training. The Chartered Accountancy course is considered to be one of the most toughest, rigorous professional courses both in India and Worldwide. It covers subjects like Financial Reporting, Strategic Financial Management, Advanced Management Accounting, Information Systems Control and Audit, Direct & Indirect Tax Laws, International Accounting and Tax and 25 different subjects and modules.

Technology and Management Training

General Management and Communication Skills Course or GMCS is a 15-day mandatory course and was introduced in 2002 to improve business communication, presentation and interpersonal skills of Chartered Accountants. It is mandatory for everybody to complete and clear the course before obtaining membership.

Apart from this, there is 100 hours compulsory technology training which they have to undergo before appearing in exam.

Hence Indian CA are considered to be the most competitive Accounting professional in the world and hired for accounting across the world.  Hence Indian Chartered Accountants are hired across the world in Middle East and Africa, Australia, UK and US.

CPAs hiring offshore part time or seasonal tax accountants

Over a period of time, CPAs have realized that hiring full time tax assistants results in increasing their costs in terms of having paid for sitting idle during non-tax season. They fail to utilize their skills and time which becomes a great loss to them. As a better workaround, they have started look around offshore part time or seasonal tax accountants. The biggest benefit that CPAs get is they have to pay only when there is an overload of work. Seasonal jobs help meet customer demands, increase revenue and maintain the company’s reputation. Employees may also be hired for seasonal jobs to prevent overworking permanent employees, which could cause them to quit.

But be Careful in selecting your Services Providers which is not that easy, please consider,

Local accounting firms whose main business is domestic accounting practices often lack talent and focus on US accounting nuances, and this considerably hampers the quality of work.

Check the required certification and credentials.

To the extent possible don’t outsource any of your work but hire dedicated professional from reputed service providers because it keeps your work under your complete control and at the same time makes the service providers responsible for their work.

1. Check the technical and software know-how.
2. Operations process.
3. Security and Confidentiality measures.
4. Experience in accounting business.

Read E-Book: BEST TOOLS FOR REMOTE WORKING

It was the days of Yore, when people would prefer to work at a stretch of 8 to 10 hours every day, in a single company for years together! Today, majority of the workforce have multiple schedules and commitments, which they are pursuing simultaneously more than ever before. They want more flexibility, and options in choosing the right kind of work, which suits their skill-sets and talents in the best possible manner. Welcome to the new era of remote staffing, a method which is substantially beneficial to both the employers as well as the employees of a business organization. Today, remote staff has gained significant following and foothold in multiple sectors and types of industries across the world.

Remote staff provides flexibility in numerous ways for to both the employers as well as the employees of a business organization. It provides flexibility in terms of reporting time, number of working hours, nature of tasks and work, and for some percentage of the workforce wanting to work for more than one business organization simultaneously! These are some of the finer points viable for discussion at some other time. Today, however, let us look at what are the benefits of having either a full time and part-time staff from a remote staffing firm working for your organization.

The Pros and Cons of having a Full-Time Remote Staff

Just as you would have any in-house employee, a full-time remote staff works for a complete duration of 8-10 hours, as required by your business organization. Although, there’s no federal law defining the number of hours an employee must work to be considered part-time or full-time. Typically, full-time staff works for about 30-40 hours per week, considering a 5-day workweek period. They’re always available to instantly communicate instructions or any urgent, or high priority work or tasks that need to be prioritized and completed ahead of any existing running tasks list. Moreover, the full-time remote staff is more aware about the workings, policies, and procedures of your firm as well as shares a strong rapport with you and other managerial personnel who are handling the workload tasks. Consequently, they are trained and empowered for temporarily resolving any operational issues or matters in times of urgency, should anyone from your firm be unavailable at that moment for guidance or approval. Furthermore, they are proactive in taking an extra step in providing value-additions to the allocated work processes such as creating reports, documents, etc. as you would regularly need, above and beyond the described job description.

However, there are certain aspects, which are of concern when having to work with Full-Time Remote Staff. For example, on rare occasions, if a full-time remote staff personnel is absent due to personal reasons, certain work might get held up for a while. Or, someone else may not be aware of the status of progress of the tasks lists assigned to that person. However, these are common occurrences in daily work life scenario, which can also be resolved with contingency planning by floor supervisor.

The Pros and Cons of having a Part-Time Remote Staff

Today, much of the working individuals are now looking at different work cultures and types of options for gaining experience and job satisfaction from the kind of work they do across their entire work life period. Apart from working at a stretch every day of the workweek, more and more people are looking for flexible options and avenues to explore their complete potential in proving their worth and garnering as much experience as possible during their career timelines. Moreover, there is a demographic of this workforce, which also prefers part time jobs for managing their hectic daily lives with having to fulfill multiple responsibilities every day. There’s more than meets the eye, and there can be multiple reasons for people now looking for different styles of working; part time jobs and alternate work options is now gaining demand more than ever before. Nevertheless, let us see what the benefits are when hiring a part-time remote staff.

Having part-time working remote staff, grants youth flexibility of having a large pool of talented resources with experiences from different sectors and industries in existence. Moreover, they are more dynamic in adapting to any changes in work timings and schedules if required by your business organization. Moreover, they prefer this flexibility, giving you the options for having staff that works round the clock, while you have closed down for the day. Additionally, if a situation arises where you would need the resources of further work force, part-time employees can be called in for attending work schedules for the period when you have more than usual workload to take care of! Such situations are not uncommon given there are certain times of the month, or year when the business is booming and you have more on your plate than you can handle, or times of slack when you cannot afford having more manpower than necessary.

Every bit of employee is an added cost of running your business. Therefore, having a flexible option where you can scale up when needed and trim down when the need is lower than usual is always welcome by any type of business organization. With part-time staff, you only need to pay for the number of hours they have worked for you, whereas you have to pay for an entire day and thus the entire month for full-time remote staffing employees. This is irrespective of the number of hours they have work on their hands, or alternatively they were overloaded with work.

Nevertheless, we also need to consider how many and when exactly part-time remote staff is more beneficial than having full-time teams working for you. You need to work out the details of your business organization’s requirements in terms of work force required for the kind of workload and timelines when there shall be surges and slacks based on past data. Only then shall you be able to take an informed and accurate decision.

Read E-Book: 10 BEST PRACTICES OF WORKING WITH REMOTE STAFF

Out of the top 10 issues faced by U.S. Accounting firms, 7 problems are related Human Resources. May it be

• High Salary Expenses.
• High Benefits and Compliances in Payroll.
• High Attrition.
• Low Productivity.
• Work Load Pressure.
• High Infrastructure and Operational Costs.
• Succession Crisis.

In order to mitigate all the above problems, many U.S. firms have started hiring Off-Site Dedicated Resources from India, Philippines, and South Africa etc. Out of top 100 firms 30 firms have established their dedicated accounting center with employee strength ranging from 50 to 1,000 employees in India.Over 250 small and midsize accounting firms from US have hired more than 3000 dedicated employees from Indian Services Providers. (Source: Indian Accounting Association).  It is estimated that by 2020 U.S Accounting firms would be hiring more than 100K (Hundred Thousand)Dedicated Employees Off-shore.

Why do CPAs prefer going for Dedicated Off-Site Employeenowadays?

With emerging technologies like remote access, cloud and network computing etc. the rules of doing business are being rewritten. The same forces are opening new markets and geographies for accounting firms with all processes based on Clouds and all employees based remotely.Public Accounting firms has changed their ways and started believing in Virtual/Off-shore Employees. They have started leveraging the choice to hire, remotely manage and pay for the skills that they need, whether part time or full time.

Are you Thinking, Hiring Off-site/Virtual Dedicated Resources is only based on the Cost benefits? Well, that may be WRONG!

Here are some key benefits:

LEASE ALWAYS TEASE:

Virtually no one who has leased office space has enjoyed writing that rent check every month. It might have been satisfying at first, when the firm or company was young and having an office was a sign of progress, but watching money go into a landlord’s pocket inevitably gets old. Still, the reality was that for most multi-employee firms, the brick-and-mortar office was foundational to the organization’s existence. Physical presence announced reliability and permanence to current and prospective clients.A physical office also was deemed necessary for employee collaboration and client meetings. Consequently, the monthly lease or loan payment was considered an unavoidable part of doing business. But considering rising infrastructure acquisition and maintenance cost, meeting fees pressure by competitively pricing services, reducing overheads cost, rise of cloud and paperless technologies has changed the mind-set of accounting firms.

Virtual/Dedicated Employees has become a reality option to pursue.For BMRG Accounting, vacating its office and going fully paperless has translated into savings of more than $95,000 an year, said Katrulya, Partner. That figure is in line with the average annual rent of about $100,000 reported by the 2,362 firms polled in the 2012 AICPA Private Companies Practice Section/Texas Society of CPAs Management of an Accounting Practice (MAP) survey. For small and midsize firms, rent and other occupancy costs represented between 6% and 7% of net client fees. With Off-Site Hiring Model your additional infrastructure and related cost turns Zero.

COST DOES MATTER

With hiring Dedicated Employee from countries like India, you can hire best motivated talent and reduce your employee payroll budget by more than 70%! You have an opportunity to Interview & handpick YOUR resources, having full access to their experience and skill levels at hand. Of course it comes with various challenges of communication and know how on policies of firms but if correctly handled having a right service provider, accounting firms can cut down Payroll and Overheads by more than 70% through this flexible hiring model.

EXPAND YOUR BANDWIDTH

After all accounting is people’s business so having bigger bandwidth will always help in delivering the work in the most rightful manner. With affordable resources available, accounting firms will always prefer to expand and invest in the bandwidth so that they can expand the services portfolio.

CONTROL IN YOUR HAND

With this model of hiring employees,accounting firms have complete control over quality standards and essential communications required for successful operations. Also the service provider manage, supervise and review the function on your behalf, so it can complement your existing managerial function too. And with latest time tracking and project management tools every little progress can be tracked and made right from the comfort of your home. In fact, YOU act as the Managerial Heads and resources co-ordinate & report to you as in case of on-site office.

NICE ESCAPE FROM CRUEL COMPLIANCE AND IT COST

As all the resources work for an accounting firm, they’re on the payroll of service provider. So this model of having employee allows accounting firms to expand bandwidth and at the same time avoid all the payroll and HR related oppressive legislation and costs associated with the same. This not only has great impact on the aggregate profitability but also save time and grants great mental peace.

BOTTOM LINE THAT COUNTS

Turn the spotlight on your business model and profit areas. Expanding bandwidth will automatically help you in offering high end and valuable offerings to your clients, so you can stay ahead of you competition.

WORK WITH YOUNG GUNS

Considering the fact that average age of Partner/Owner of an accounting firm is 54 years and that of staff is 48 years as per AICPA survey, severe questions are raised in the areas of work productivity, change in practices through better use of technology, succession planning, and crisis of young talent. Also accounting in US is considered to be the old generation profession as young guys are much interested in tech and consumer facing businesses. Hence hiring off-shore employees from countries like India become more obvious choice where accounting is still considered by young as an aspirational career options. Average age of the workforce is 29 years, much lower than that of United States.

And many other benefits includes institutionalizing the operations of the firm by expanding bandwidth, better practices, Attrition management by putting the non-core work from your core staff, training and staffing.

Read E-Book: 10 BEST PRACTICES OF WORKING WITH REMOTE STAFF

Cloud Computing has opened a great number of avenues for multi user and multi location applications. It enables ubiquitous, on-demand access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications and services).

One application that has utilized this new tech is Cloud Accounting. Cloud Accounting is the access of accounting software where the software (and the data) is stored on the cloud rather than on your computer. This kind of  accounting software is similar to traditional accounting software that are on-premises, the only difference is the accounting software is hosted on remote servers, like the SaaS (Software as a Service) model of business. Data is sent to “the cloud,” processed and returned to the user.

Cloud accounting software liberates the accounting firms from the hassles of installing and maintaining accounting software on individual desktop computers. It can be accessed remotely from any device having Internet and allows both you and your accountant gain full access to the software application and data. The employees in other departments, branch or remote offices can also access the same data and software from their own desktop without personally visiting the office.

Cloud accounting is the next step in the evolution of accounting software. According to International Data Association, 50% of small to employers will be using cloud accounting by the year 2016. Cloud accounting offers a secured, inexpensive and remote access to the accounts of your company or business. Using cloud accounting you can create invoices & pay bills, generate purchase order, track expenses, suppliers’ bills & payments, profits & cash flow, manage taxes, monitor budgets, view company snapshots, dashboards and more.

Cloud accounting takes accounting to an all new level and offers an array of benefits as compared to manual methods. A few of them are listed here –

1) Less Time Consuming -Accounting software on cloud help to save a lot of time consumed in transferring data from one device to another. In fact, you need not wait for going to office to access your company accounts. You can access the accounts from any place and at any time.

2) Automated Calculations and Backup– The calculations are automated in cloud accounting, which also saves a lot of your valuable time and efforts. Also, the cloud accounting automatically backs up all your data making you free from the worries of losing your data by any chance.

3) Remote Access & Automatic Bank Reconciliation – Cloud accounting gives you remote access of the accounting software from any location and device. It makes you work independently of the device you are using or the place you are operating the software from. It also automatically reconciles the bank accounts with the accounts of your company.

4)Automated Data Inputs, Emailing of Invoices &Filing of Tax Returns – Accounting software on cloud automatically takes input and on the basis of those inputs it email the invoices to the relevant email account. Also, cloud accounting eases the hassles of tax filing through its automatic tax returns filing feature.

5) Cost Saving – Cloud accounting helps you to save a lot on the costs. There are no up-front hardware costs you need to pay like office infrastructure cost or relocation costs. Not just this, but cloud accounting also facilitates you to pay the cloud cost monthly.

6) Convenience –The convenience offered by cloud accounting has taken accounting to an all new level. You or the employees of your company can now manage your books via a remote access using multiple devices.

7) Always Up To Date – Cloud accounting offers free automatic software upgrades that keep your accounting software always up to date.

Despite these many benefits, there are some barriers due to which companies are reluctant for its adoption but cloud accounting has answers to all their concerns.

Security Concern – The level of security offered by cloud accounting is at par with the security levels offered by major banks. This vanishes the security concern of companies and keeps their data completely safe.

Vendor Confidence – More than 90% of the cloud computing users say that they are happy and had a great experience using cloud accounting. To find the right vendor for you and you business, you can use the free trials of cloud accounting.

Ease of Use – Most of the people are concerned about the level required to use of cloud accounting. But, cloud accounting is very easy to set up and offers the best services. It also offers free online and telephone support to help you.

Long-Term Contracts – There are no long-term contracts in which you or your company needs to be locked. Most of the service providers offer free trials and monthly payment options.

With cloud accounting, it has become easier to have real-time visibility and reporting throughout the organization. It has given the traditional accounting all new level with mobile capabilities and collaboration.

Read Ebook: 10 BEST PRACTICES OF WORKING WITH REMOTE STAFF

Today, any business organization faces tough competition, along with increasing costs of capital investment, demanding higher pay scales, complicated legalities, among a plethora of challenges, which affect revenue, profit, and year-end target achievements. Nevertheless, recruiting experienced personnel brings along with it expensive approaches such as Placing Ads, Screening Interviews, Testing and Training of Employees, etc. Moreover, having in-house employees brings with it many hassles like Payroll Taxes, Medical Benefits, Retirement Plans, Vacation/Sick Days, etc.

Every step of the way involves some form of expense before and after acquiring employees. Even in the long-run, the total cost of acquiring an employee is still be high. Consider hiring involves hiring costs, operational overheads, infrastructure expenses, and HR hassles considerably. Let us look at the various costs of having an Employee. Basic Acquisition Cost for an Employee through Agency or Hiring For acquiring any employee, all processes beginning with searching for one, shortlisting from all the received applications, holding test and interviews incur costs in terms of time, efforts and most importantly money.

Consider all types of costs such as placing advertisements in newspapers, tabloids, or even digital platforms, or having a recruitment agency bear the burden of inviting job applications from interested and suitable candidates. Posting on Job Boards, Screening Resumes, Shortlisting Candidates, Conducting Background Checks, etc. along with any On-boarding or Recruiting Time estimated, and the notice period to be served in the previous organization of the newly Recruited Employee called as Waiting Time (usually in several weeks or months) are cost inductive activities since the beginning.

Furthermore, temporary hiring agency solution would have recurring costs and liabilities and certain disadvantages as compared to having permanently appointed personnel within your organization. An estimated cost of approximately $4500 is incurred when hiring one candidate for a job role within your organization. Payroll Taxes & Health InsuranceFor every employee taken aboard, numerous financial liabilities need to be addressed and kept on track. For every employee’s salary paid every month, the controller needs to track and levy all taxes and deductions to meet the stringent guidelines set by the IRS and Tax laws as specified every year. Especially, since the introduction of the TCJA Act 2018, there have been several amendments to specific sections such Payroll Tax and Health Insurance. With effect from 2018, the FICA tax rate for employers is set at 7.65% of which, 6.2% is levied on OASDI (Old-Age, Survivors and Disability Insurance program) and 1.45% TAX on Hospital Insurance (HI, commonly known as the Medicare Tax). Thus an employee will pay:

• 2% Social Security tax on the first $128,700 of wages (maximum tax is $7,960.80 [6.2% of $128,400])
• 45% Medicare tax on the first $200,000 of wages ($250,000 for joint returns; $125,000 for married taxpayers filing a separate return), plus
• 35% Medicare tax (regular 1.45% Medicare tax + 0.9% additional Medicare tax) on all wages in excess of $200,000 ($250,000 for joint returns; $125,000 for married taxpayers filing a separate return) as per Code Sec. 3101(b)(2)

Conclusively, for every employee that you have recruited for your organization, you will have shell out and extra $7,960.80 for an employee with a salary of $128,400 (or more as applicable). Paid Time OffHaving salaried personnel implies there are possibilities of unforeseen leaves or sanctioned holidays when the need arises. People need leaves — planned or unplanned every year, and hence, every organization has a leaves policy entitling every employee to having sanctioned paid leaves every year. Such leaves incur every organization some costs in the absence of those employees in a certain period. Apart from the amount of salary payable for days absent, in proportion to their entitled salary per month, other costs are not of cash in nature but more of operational hindrances such as the workflow being affected or held up until the employee returns from their leave period. Or, if the employee is a key person in management or in some process of decision making, then the time lost might probably affect the revenue or maybe cash outflow, since crucial decisions were not taken on time. All such impending costs add up to the expenses of your organization, increasing the cash outflow, and thereby, affect the yearly revenue. Retirement Savings Benefit Retirement Savings Benefit is a provision that every employee and employer has to plan and implement when negotiating the salary components and the dues deducted therein.

Under this 401(k) Retirement plan, the contribution limit is $18,500 in 2018 for all employees under the age of 50, and those age 50 and above can make catch-up contributions of up to an additional $6,000, for a maximum possible contribution of $24,500 in 2018. It is to be noted that management and professional positions generally have the biggest employer contributions, with the highest 401(k) matches tend to be paid out by large companies with over 100 employees (according to Bureau of Labor statistics data).

The most common 401(k) match is 3 percent of salary, with few others employees asking for up to 10 percent of pay or more for retirement. The most common employer match is 50 cents per dollar saved up to 6 percent of salary agreed upon. Nonetheless, many employers might provide dollar per dollar 401(k) matches to a maximum possible match of 3 percent of salary. Thereby, you can consider that an average of 3-5 percent of net salaries paid is an additional expense in your business. Attrition / New Hire / Onboarding – training Employees are human beings, making it impossible to hold your best performing employee from staying with your organization permanently. Greener pastures can crop up anytime during their entire career span, and it may happen that people may shift to other cities or countries, making them look for other sources of income. As with such situations, you are back to square one, with seeking and selecting a new candidate for the said job position.

Every Attrition is followed by new hiring, followed by onboarding and training schedules which are nothing but increased costs incurred till the time the recruited candidate beings operations and turns beneficial to your organization. This again amounts to an average of about $4000 per employee recruited any time during a financial year. Overhead Costs All significant expenses discussed about, leaves us with Overheads incurred per employee within your organization. Infrastructure facilities such as floor space, furniture, hygiene facilities, lighting, cooling, and ventilation mechanisms, in-office cafeteria inventory and operational expenses, etc. are all forms of overheads incurred per employee in your organization.

An estimated $250-$1200 is expended per employee per month considering the bare minimum of facilities provided within organization. With all the given facts & figures, the average cost runs between $15,000 -$35,000 per year besides the actual salary paid to every employee. However, many larger firms have saved enormous by establishing their offshore offices and doing away with most of the compliance mentioned here. For smaller firms remote staffing brings a similar solution.

You can read about it in more details in our eBook: Save:$26,000 to $60,000 Per Employee.

Now that migration to the cloud is inevitable, proactive CPAs are finding ways to take advantage of the cloud to revamp their practices, and are evaluating the changes to their core services – tax, accounting, and payroll – made possible by the cloud.

In this article, we’ll focus on how cloud technology has enabled an important breakthrough in client accounting.

The development of DIY (Do-It-Yourself) accounting software, led by Intuit, fundamentally changed accounting, and today, the DIY model is the norm for accounting software. Almost all accounting systems, whether desktop or cloud-based, are created primarily for small businesses, and are sold directly to them.

DIY accounting systems undoubtedly offered considerable advantages compared to the manual accounting they replaced, but they have also created many challenges for accountants. DIY systems have taken control of accounting away from accountants, and the bookkeeping errors clients make while using DIY software products have become a major source of wasted time and effort for accountants. Many accountants also feel that DIY accounting systems reduce their standing and relevance in their clients’ minds.

While most cloud solutions are based on DIY model, a new DDIY model has emerged that harnesses the cloud to give control of accounting back to accountants, lets accountants overcome the challenges they currently face, and makes accounting more profitable and rewarding.

The cloud-based DDIY accounting system takes the opposite approach to the DIY model. While DIY software was created for small businesses and is sold directly to them, DDIY software is a professional system that is sold exclusively to accountants. It lets accountants work collaboratively with their clients while they remain in full control.

An important advantage of the DDIY system is that accountants can give their clients as much or as little involvement that’s right for each client. Accountants can easily undertake all accounting functions for the clients who prefer not to do any accounting work. The DDIY model makes offering complete accounting services highly profitable, because with the DDIY software, your staff can do what your clients’ staff currently does, only fast, easier and more accurately, all without leaving your office.

Because DDIY systems can be easily customized for each client, you can work collaboratively with clients who want to maintain some involvement in accounting, enabling them to perform the functions that suit their needs and abilities.

For the clients who prefer to write checks by hand, you can perform after-the-fact write-up work much faster than ever before. Automatic downloading of credit card and bank transactions can virtually eliminate data-entry, and can reduce the time spent on write-up engagements by 50-70%.

If you have clients who are better served by a system other than the DDIY system you offer, those clients can continue to use the system that best meets their needs. The DDIY system enables you to download data from the systems they use and use your own DDIY system to perform trial balance work and prepare fully-customizable financials.

Another useful advantage of the DDIY model is that it lets you offer your clients timely financial advice for managing their cash flow and running their businesses efficiently.

The DDIY model not only makes your accounting practice highly profitable, it also makes it more rewarding by raising your relevance.

Now you can tell your clients, “Don’t-Decide-It-Yourself. Let’s work together to make accounting painless for you.”

That’s why the new model is called the DDIY model.

Read E-Book: 10 BEST PRACTICES OF WORKING WITH REMOTE STAFF

Many accounting firms of this generation see remote employees as a solution to reduce overwhelming workload, particularly during tax season. Hiring remote staff opens up chances to reach out to more candidates from all over the world. It not just opens a wide pool of qualified and experienced international talent but also helps cut hiring cost, operational overhead, infrastructure expenses and HR hassles considerably. But it is really important to know the person well before hiring. A good hire is as good as a thoughtful investment which will ultimately add value to your firm, so it is always recommended to have a rigorous hiring process to bring a new staff onboard.

Here are top 5 points to consider while hiring remote staff:

1. Keep the important set of questions handy

Almost every employee being hired for remote work is interviewed over a video conference. By the means of video, an interviewer can easily observe and rate the body language, facial experience and overall confidence level of the candidate being interviewed. A continuous interaction and smart questionnaire lead to a defining interview session. It is even better if an online test could be conducted. This will determine the practical approach of the candidate at his task and justify what he has mentioned on his resume. This process is just about the first and most important phase of having a great employee.

2. Whether to go for onshore or an offshore remote employee

While shortlisting out the applications of remote workers, you should notice the salary difference between domestic and international applicants. A US-based employee is more likely to be paid higher than the one who is based overseas. There are a multitude of reasons to it, the expense of lifestyle could be one factor in the overseas applicant’s case, compliance and other benefit costs could be other.

Both have their own sets of pros and cons. For example, an onshore employee will largely available to work in the same hours during which your office is open, an offshore employee is based in a different time zone which sometimes feels difficult when you need to give instructions in real time. However, there is always some overlap to manage things.

3. Communication Skills and reporting abilities

Your remote employee will always have to communicate things to you and your clients. The conduct and the skills are very important to observe and account for. It is always recommended to have only those employees who speak English. An onshore employee knows the local language best and has slightly an upper hand over overseas employees. However, every person keeps learning with each passing day and with time the overseas employee is also very likely to adapt to company culture and the ways how communication is carried out at the firm.

4. Setup for work

Now while a remote staff saves the cost of infrastructure building and expansion of office space to accommodate more employees, at the same time it also renders the sensitive client data vulnerable. So it is very important to have a security plan for safekeeping of such information. It is always recommended to take a legal commitment from the employee or the staffing agency which must bind them with non-disclosure. If the remote employee is working from the offshore office of the agency then one can check how they do mitigate the risks and threats of data security.

5. Time Management and daily reporting

Employers are generally looking for remote workers who can manage time well efficiently. Quality centric, focused, timely delivery of assignments are important to have in a remote staff. Daily filling of time sheets and routine reviews and communication are keys to managing remote staff as they don’t work from the office physically.

How Entigrity Remote Staffing Helps?

Entigrity has helped over 500+ CPAs and accounting firms hire qualified and experienced remote staff. Even though our hiring process is rigorous but we still allow the hiring managers to conduct interviews and tests to be fully assured of the person being hired. Entigrity Remote Staffing is also an ISO 27001 certified organization and has processes and policies in place to safeguard client information.

Read E-Book: 10 BEST PRACTICES OF WORKING WITH REMOTE STAFF