One positive thing came from the pandemic, companies realized the benefits of going remote. No more suits, traffic, or office distractions. Going fully remote, is no easy feat though. There are many working items to consider, especially for a remote accounting team. This is your guide on how to setup a successful virtual accounting team.
In this article you will get:
- A brief on what virtual accounting is
- Remote accounting department structure best practices
- Automated accounting software for remote accounting
- 4 traits to look for when hiring a virtual accountant
- How to do payroll and taxes remotely
What Is Virtual Accounting?
It is similar to traditional accounting, but everything is done remotely. Accountants manage client financials remotely with automated accounting software. Since many accounting functions are on cloud-based platforms, it is relatively easy for an accountant to do remote work. With many clients it makes sense to break accounting tasks amongst a group of people. So we have seen an uptick in virtual accounting teams.
Remote Accounting Department Structure Best Practices
Deciding to go 100% remote is NOT a wise venture for those who aren’t tech savvy. Technology is an absolute must for a remote accounting department. Operations and communication will be done through virtual tools. However, you can’t run accounting on tech alone. You will need qualified virtual accountants see projects to completion. Here are remote accounting solutions to setup your team successfully:
Cloud Accounting Software For Virtual Accountants
The accounting world has been evolving to eliminate manual processing. Old repetitious methods relied on time, paper, and pencils. Setting up your remote accountants with cloud based accounting software, will enhance productivity.
Take a look at the accounting processes that you are performing, and want to automate. Ideally you want something that can perform multiple functions. The size of your business and your bookkeeping method, should weigh into your decision. Here is a chart of essential cloud accounting software for virtual accountants.
| Accounting | AR/AP | Payroll | Expenses | Taxes |
|---|---|---|---|---|
| Xero | Xero + Bill.com | Xero + Gusto | Xero Expenses | H&R Block |
| QuickBooks Online | QuickBooks Online | QuickBooks Online | QuickBooks Expenses | TurboTax |
| Sage | avidxchange | Gusto | Expensify | Jackson Hewitt |
| Bench | Melio | OnPay | Zoho Expense | TaxAct |
| inDinero | versapay | ADP | Mint | Tax Slayer |
The top two accounting software programs for small businesses are Xero and QuickBooks Online. Both have a multitude of integrations to support the accounting department. We prefer Xero for almost any situation, except large inventories of 4000+ units.
Remote Accounting Solutions for Communication
Accounting teams thrive on communication. Companies that don’t communicate, aren’t successful in the long run. These are 3 areas of operations that need exclusive channels of connection:
- Project Management – Managers and/or owners need a way to have command over projects, delegate tasks, and pave a clear chain of approval.
- Meetings – Crucial for addressing accounting team progress, project pain points, and major accounting changes in relation to overall company goals.
- Customer Service – A virtual accounting team will need to speak with clients as representatives of the business.
The ultimate goal is to find a way to communicate. You need something that won’t be cumbersome for you, your employees, AND your clients. Thus you will be relying on cloud based software to facilitate communication. Here are the best communication platforms for the 3 areas of operations of the remote accounting team:
Project Management Tools for Accountants
Project management tools keep virtual accounting organized and eliminate micro management. Providing a way for team members to see upcoming tasks and visualize progress. Your remote accountants will also feel a sense of company culture, versus a one on one relationship with accounting manager. Try one of these task management applications to stay on top of accounting deadlines:
Asana
This is the project management application we use. It is geared to help business owners and managers prioritize effectively. Asana has enhanced features to monitor progress. With Timeline and Portfolio you have an overview of team member workloads. Streamline the workflow with 100+ integrations for the virtual accounting team.
- Popular Accounting Integrations: Google Suite, Salesforce, Slack, Harvest, Zenefits, TSheets, and more
Freedcamp
Any size team can benefit from this project management tool. You assign people to work on milestones and view progress through time tracking. Communication between remote accountants happens via discussions and file sharing. As a company grows, Freedcamp grows with you. The platform has a full stack of added features, plus a few outside integrations.
- Popular Accounting Features: Google Suite, Freedcamp Customer Relations Management (CRM) tool, Freedcamp billing and invoicing tool, and more
Virtual Accounting Meeting Applications
There will be times when you need to bring team members together. These applications each hold the key to connection for accounting team meetings:
Slack
We use this as our communication and meeting tool. It acts as a hub for accounting project communication, ideal for a virtual accountants that feel cutoff. You can message, video chat, call and send files to team members. It also keeps one historical archive from all members, to consult during projects, versus sifting through emails.
Zoom
Widely used video conferencing app. They feature phone, video meetings, and chat on the app. They have had outages and hacked calls in the past. Bear with them as they innovate.
Customer Relation Management Software for Accountants
Customer Relation Management (CRM) is a trusted way for a remote accountant to communicate with customers on behalf of a business. They offer contact management, marketing, and centralized client conversations. Here are popular CRM tools for the virtual accounting team:
Hubspot
This is an inbound marketing communication software, with limits of 1 million contacts. They are 100% free forever. Communicate with customers about your goods or service, convert leads, and manage email campaigns in one system. They also have task management capabilities, to centralize workflow for the team.
Zoho CRM
While Zoho is a subscription based service, it is not your run of the mill CRM. Virtual accountants can speak with clients via phone, email, live chat, and social. It offers an AI sales assistant to help you predict leads, notify you on best times to contact a lead, and find anything in the company rolodex. Zoho limits you to 100,000 contacts.
Equipment for Remote Accounting Offices
Team productivity increases with fully functional equipment. If your accounting department is going remote, you’ll need to decide whether these essentials will be provided. At the most basic your accountants will need:
- Computers
- Phones
- Phone Data Plans
- High Speed Internet and Bandwidth
Data and Backups for Virtual Accounting
The accounting department requires data. You will be storing files and documents galore. Since financial documents are of a sensitive nature. There should be a safe place where these files are accessed. Don’t forget to back up everything, just in case. Here are some common file storage options:
Google Workspace offers a whole collection of applications built for collaboration. Google Drive is one of their applications. It is a storage center that encrypts data for safe sharing. It has built in security, so only invited people can see shared files.
Neat little tech buddies that store an allotted amount of data to transfer. In case of a cloud SNAFU, work is backed up, and can be uploaded where you see fit. They come in varying sizes and with different security encryption programs to protect your documents and files.
Security for the Remote Accounting Team
With money you need security. The level of security will be determined by your business. You need to equip all working computers with protection from outside intruders. Additionally, implementing a separation of duties in your accounting platforms, will keep sensitive information privy only to higher ups. For logins and passwords, 2 factor authentication (2FA) is a great hacker deterrent. Get familiar with these security features:
According to the U.S. National Cyber Security Alliance, 62 percent of all cyberattacks are on small-medium sized businesses. That ends up being about 4,000 cyberattacks per day! – McAfee
Encryption
Encodes files into an unreadable format, unless someone has the key to decode. Keys come in the form of passwords or invited access. Cloud software will usually encrypt files while they are resting or in transit.
VPN
If you are conducting business exclusively online, consider a virtual private network (VPN). It will mask your IP address by bouncing off secure servers, every time you are online. Servers are provided by the service providers, the more they have the better. This prevents hackers from getting in to your network. A business VPN subscription can be downloaded to multiple devices. Virtual accountants can access the network with a login.
- Recommended: NordVPN, Perimeter 81
Antivirus Software
If somehow, something slips through the cracks. This software keeps business and client information secure, via web and firewall security. It can be downloaded to all devices as an extra boost of protection.
Can An Accountant Work Remotely?
Not all accountants can work remotely. Certain personality types thrive in this setting, others just don’t. Getting the right team members to roll with the distance, will have a high return.
In a virtual workplace, it can be easy for companies to lose touch with the human side of the business. – Clutch
4 Traits To Look For When Hiring A Virtual Accountant
It is critical to find experienced accountants that are able to work independently. They can’t be completely anti-social because they are members of your accounting department, and a representative of your business. Here are 4 traits to look for when hiring a virtual accountant:
- Independence: they need to be self sufficient enough to get tasks done.
- Proficient in Technology: you want virtual accountants to be able to perform their job responsibilities with little training.
- Openness: an ability to participate in the culture of a business without actually being face to face.
- Confidence and Quick Decision Making Skills: virtual accountants need to make snap decisions with confidence. It will helps move project along, in comparison to someone who requires lengthy conversations for decisions.
How Do I Pay Virtual Employees?
Depending on the type of employee you hire determines their pay structure. Salaried or contract accountants will be accommodated in a payroll system. You want something that can automate tasks like tracking earnings and wages, calculate/pay tax, manage compliance documents and disperse payments on time.
This will make payroll for your remote accounting team effortless. The cloud based payroll software services mentioned earlier, will manage this for you. Here are some vital points to be aware of when paying your remote accountant:
FICA Taxes for Virtual Accountants
Paying income taxes for salaried remote accountants, works a little differently than in house accounting. If your remote worker is in your home state, you withhold your state income tax. Factors like their location, and salary will determine if you need to register with their states and local tax agencies. You may also have to register with their home state labor and unemployment agencies.
How to Pay Remote International Accountants
An international virtual accountant comes with its own set of payroll intricacies. They are living somewhere that maintains a different set of labor laws. Equal pay and exchange rates need to be considered, when calculating salaries. Many countries will require you to set up a business in that country to pay income taxes. This is the main reason why international employees are usually contract labor in the U.S.
Remote Accounting Teams Without the Office Fluff
Here are your biggest takeaways from this remote accounting team guide. Technology. Technology. Technology. Build out your tech stack for a successful virtual accounting department. Keep in mind automated accounting software needs to be reviewed by a person. In virtual accounting you need to hire those that are comfortable with autonomy. Plus you need to understand the tax responsibilities of hiring remote accountants.
