Every growing business needs a strong finance and accounting function and reliable financial operations for success. Traditionally, businesses have managed F&A in-house. As companies scale, maintaining an internal finance team becomes costly and complex.
Outsourcing, particularly through Finance as a Service (FaaS) providers, offers a disruptive and increasingly popular alternative. In fact, 79% of investor-backed CFOs already work with a finance and accounting partner, highlighting the widespread adoption of outsourced financial solutions.
However, outsourcing may not be right for every business. We’ll explore the pros and cons of outsourcing finance and accounting to help determine if it fits your business needs.
| Pros | Cons |
|---|---|
| Cost Efficiency: Outsourcing saves businesses 20-50% in F&A expenses. | Perceived Loss of Control: Worry about losing direct oversight of financial operations. |
| Scalable Financial Operations: Businesses can scale financial support up or down as needed. | Potential Integration Challenges: Concern of ability to work within existing financial systems. |
| Access to High-Level Financial Expertise: CFO insights, GAAP-compliant reporting, and advanced forecasting. | Not Ideal for All Business Models: May not suit manufacturing or businesses with heavy inventory. |
| Faster, More Reliable Reporting: Proven people, processes, and systems improve speed and accuracy. | Communication & Responsiveness Concerns: Fear outsourced teams may not respond as quickly as in-house staff. |
| Frees Internal Resources: Focus on growth and strategy instead of mundane tasks. | Predictable Costs but Not One-Size-Fits-All: Outsourced pricing depends on service needs and complexity. |
| Access to Cutting-Edge Technology: Best-in-class solutions eliminate the need for in-house investments. | Cultural Fit & Team Integration: Challenge integrating outsourced teams into corporate culture. |
| Flexibility: Only pay for the services needed, operating on a scalable SaaS-style model. | Lack of On-Site Presence: Businesses may prefer on-site finance teams to remote outsourced solutions. |
| Enhanced Compliance & Risk Management: Experts ensure GAAP, IFRS compliance while reducing fraud risks. | Internal Team Concerns: Employees may fear job displacement. |
Advantages
1. Cost Efficiency
A key benefit of outsourced F&A is it’s often more cost-effective than maintaining an in-house team.
- Eliminates costs for hiring, training, and retaining accounting staff
- Reduces expenses for financial software and IT infrastructure
- Provides CFO, controller, and accounting support at a lower and more predictable cost structure than hiring full-time employees
Between rising accounting salaries and software costs, we’ve found that outsourced accounting typically saves businesses between 20-50% in F&A expenses.
2. Scalable Financial Operations
An outsourced finance function scales with your business. Whether expanding operations, raising capital, or preparing for an exit, an outsourced solution ensures the right level of financial support at every stage.
Companies can quickly scale their finance function by adding headcount or CFO support as needed. Outsourcing allows businesses to turn services on and off—for example, ramping up finance operations before an acquisition and scaling down afterward.
3. Access to High-Level Financial Expertise
FaaS providers offer more than bookkeeping:
- CFO insights for strategic planning.
- GAAP-compliant reporting for investors and auditors.
- Advanced analytics and forecasting for informed decision-making.
For private equity and venture-backed companies, accurate financials are essential. Outsourced providers ensure transparency and investor-ready reporting.
4. Faster, More Reliable Reporting
Closing the books can be slow and error-prone for internal teams when they’re overworked, lack the technical skill, or are operating on outdated systems. An outsourced finance team:
- Speeds up month-end closes with fewer errors
- Provides real-time financial insights for better decisions
- Delivers audit-ready financials to enhance transparency
5. Frees Internal Resources
Managing an internal finance team requires time and effort. Outsourcing allows leadership to focus on core business functions, growth strategies, customer acquisition, and investor relations, rather than spending time on compliance, reporting, and transactional tasks.
With an outsourced finance team handling day-to-day tactical and clerical work, FP&A, month-end close, and financial reporting, executive teams can redirect their attention to high-impact initiatives that drive revenue and long-term business success.
6. Access to Cutting-Edge Technology at a Lower Cost
Outsourced providers leverage the latest financial technology without requiring companies to invest in expensive software.
For example, Consero’s AI-powered SIMPL platform automates and streamlines finance operations, reducing manual work and providing real-time data insights.
7. On-Demand Support & Pay-As-You-Go Flexibility
Businesses only pay for the services they need, when they need them. Instead of hiring full-time staff for fluctuating workloads, outsourced finance solutions provide on-demand support, adjusting services as business needs evolve.
The Finance as a Service model operates like a SaaS subscription, offering predictable, recurring fees without the overhead of hiring an in-house team.
8. Enhanced Compliance & Risk Management
Keeping up with regulatory changes and compliance requirements can be challenging for in-house teams. Outsourced providers specialize in maintaining audit-ready financials, ensuring businesses stay compliant with GAAP, IFRS, and other industry regulations.
By leveraging experts in internal accounting controls, companies can mitigate fraud, reduce compliance risks, and improve financial accuracy without adding internal overhead.
Disadvantages
1. Perceived Loss of Control
Companies worry about losing control over financial decision-making, but a modern FaaS provider enhances strategic decision-making by providing real-time access to easily digestible financials.
Choosing a provider that offers full transparency and communication frees businesses leaders to maintain oversight while benefiting from outsourced expertise.
2. Potential Integration Challenges
Outsourcing requires smooth integration with existing financial systems. Working with a provider that supports platforms like NetSuite and QuickBooks helps streamline the transition and prevent inefficiencies.
Consero’s FlexFinance service works within any general ledger, allowing companies to keep the systems they are comfortable with while still benefiting from an outsourced finance function.
3. Not Ideal for All Business Models
While outsourcing works well for healthtech, SaaS, professional services, nonprofit, and investment firms, it may not suit manufacturing, companies that have high inventory, or businesses requiring on-site financial management.
Companies needing daily hands-on financial oversight may benefit from a hybrid model that keeps some functions in-house.
4. Communication & Responsiveness Concerns
Some businesses worry that an outsourced team may not respond as quickly as in-house staff. Choosing a provider with dedicated finance professionals and real-time dashboards ensures fast responses and continuous visibility into financial data.
5. Predictable Costs but No One-Size-Fits-All Pricing
FaaS follows a predictable pricing model, but costs vary based on complexity and company size. Understanding pricing structures, service tiers, and potential add-ons before committing ensures there are no unexpected expenses.
6. Cultural Fit & Team Integration
Some companies worry that outsourced finance teams won’t blend well with their internal teams. Consero works with you to ensure that outsourced team members are invested in the company’s success, acting as an extension of the organization rather than a disconnected third party.
7. Lack of On-Site Presence
For companies that value having finance staff on-site, outsourcing can feel distant. To bridge this gap, Consero provides a North America-based VP of Finance who offers leadership-level guidance and maintains close communication with stakeholders.
8. Internal Team Concerns
Employees may feel threatened by outsourcing, fearing job displacement. Consero’s approach enhances and supports internal teams rather than replacing them, allowing businesses to offload transactional tasks while empowering their teams to focus on higher-value strategic work.
Is Outsourcing Right for Your Business?
Outsourcing finance and accounting suits scaling companies, investor-backed businesses, and nonprofits that need financial sophistication without the cost of an in-house team. If your company requires daily financial oversight or operates in a highly specialized industry, a hybrid approach may be better.
With nearly two decades of financial transformation expertise, Consero provides tailored solutions that help businesses optimize their finance function. Our Finance as a Service (FaaS) model delivers the technology, processes, and people you need to establish a world-class finance department quickly.
- Need to modernize your finance function? Our AI-enhanced SIMPL platform provides real-time financial insights from a single, intuitive interface.
- Already have existing systems? Our FlexFinance service integrates with your current technology stack and manages your back-office finance function.
- Need skilled talent? Our FlexResources team supplements your finance and accounting staff with experienced professionals.
Request a consultation to learn how Consero can help you gain clarity, efficiency, and scalability in your finance function.
