• Wyatt D.

Outsourcing vs In-House Bookkeeping: What's Right For Your Business?

Updated: Jan 28

Many CEOs and owners rely on in-house bookkeeping to receive their financial statements each month because it’s what they’re used to. However, with technology advancements in recent years, traditional is not always best when it comes to managing your company’s financial standing.

In-house and outsourced services offer different workflows when managing the bookkeeping for your company. While we understand that outsourced bookkeeping is not right for every business, if it does fit your business’s needs, it can often cost less and provide more expertise than a traditional in-house accounting department.


Outsourced bookkeeping often provide higher quality and expertise. Employees of outsourced services are usually experts who undergo continual training in accounting and technology.

In-house bookkeepers - those who are employed by your company - vary widely in their backgrounds and skill sets. Unless you’re hiring a new employee who’s fresh off the job market, it’s hard to control who’s already sitting in that position within your company.

Risk of fraud

Here’s an accounting-related issue you might not have considered: preventing fraud within your organization. It’s an unfortunate fact that you’re much more likely to experience fraud when you use in-house accounting rather than outsourcing.

The reason is that an employee can be far more tempted to “cook the books,” embezzle, or commit other types of fraud. Employees have more access to confidential information and can more easily persuade others to go along with a scheme.

As an example, look the embezzlement scandal that rocked ING, which is itself a financial services company. Nathan J. Mueller, an in-house accountant, was able to steal $8.5 million from the company by having checks and other funds rerouted to him.

"Outsourcing helps reduce the risk of fraud associated with your business’s Bookkeeping because there are separation of duties and more rigorous steps taken when providing financial statements for the business."

The ING situation couldn’t have happened with an outside provider. They wouldn’t have had access to the company’s other systems - plus, they always have an incentive to avoid any kind of impropriety: their reputation in the industry.

CDO has two sets of eyes reviewing each step with different levels of staff working on one account. There are steps taken for one employee to review the others work to ensure there aren’t any discrepancies or errors.


Make sure you accurately balance the costs of in-house Bookkeeping vs. outsourcing. A full-time in-house bookkeeper’s annual salary is roughly $46,000. Two employees cost $92,000.  It’s not just about how much you pay an employee per year. What about benefits, like health insurance and 401K? Your business won’t pay overhead costs when using an outsourced service.

There’s also the productivity cost of paid time off, when your employee is unavailable during sick time and vacations.

If your in-house Bookkeeping is low paid but highly skilled, you’re lucky. The cost may be well worth it. Otherwise, look into outsourced accounting, which typically charges an up-front fee, plus an hourly rate.

CDO uses an all-in-one flat monthly fee structure that provides total cost clarity. we have a team of expert bookkeepers who work accordingly to your needs and can handle the most difficult Bookkeeping situations . If you want to keep better books, we can give you a free consultation, click here.

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