Equity accounting and reporting is fundamentally complex; with ever-changing rules and regulations that require expertise that is costly and hard to find. This responsibility often falls onto a team that already has a full-time job of managing the company’s day-to-day financial needs. It is critical to accurately report equity holdings but without a dedicated equity reporting team, outsourcing may end up saving time, money, and provide peace of mind that you are compliant.
Top Five Reasons to Outsource
- Minimize risk of misreporting. When your team is multi-tasking or wearing multiple ‘hats’, there is always a heightened potential for error. With equity reporting, errors can be financially devastating and could lead to legal issues that can take months to recover from. By outsourcing your equity financial reporting to a team of Certified Equity Professional (CEP) experts, you can significantly reduce the risk of misreporting financial data and have confidence in your compliance.
- Remove time-intensive and error-prone internal procedures. It is no secret that equity reporting is labor intensive and at times very complex. When your team is forced to drop other critical tasks to focus on it, there is a wide range of costs that always surface. Error-prone procedures are hard to recognize and even harder to correct. By removing this burden on your team, you eliminate complicated workflows and remove the need to review and improve internal processes.
- Evade internal software limitations. Most firms are trying to force their ERP or other accounting software to handle reporting it was never designed for. In the time it takes to process equity plans in a system not designed to accommodate this process, you could have calculated everything offline manually. Stop trying to force a square peg into a round hole. Expert teams employ expert systems that are specifically tailored to meet the needs of equity financial reporting.
- Eliminate manual spreadsheets. We all love spreadsheets, right? We can build anything we want to get exactly the information we desire. However, intricate spreadsheets take months to perfect, hours to update, and typically a single employee that understands how to operate them. As long as your spreadsheet expert never takes a vacation, retires, or finds a new employer to build spreadsheets for, you may be good to go. Who are we kidding? Spreadsheets are the best and worst products in our work life. Outsourcing equity reporting will help eliminate these precarious documents.
- SOC 1 & SOC 2 compliant. Navigating any audit is overwhelming and time-consuming when internal processes are relied upon. Outsourcing your equity financial reporting eliminates the need to document and verify that adequate internal controls are in place and functioning as designed. Annual SOC 1 and SOC 2 compliance reports, quarterly gap letters, and management responses can confirm the integrity of the system.
Accurate and reliable reporting is essential. Numerous award types, various schedules, reporting requirements, and accounting steps, makes accurate and reliable reporting complicated. Unless you plan to hire a team of CEP experts, outsourcing could be a cost-effective alternative to manage your equity financial reporting.
If you are interested in learning more about outsourcing equity financial reporting services, Certent can help. With over 300 reports covering 15 award types, our team of CEP experts can help manage your financial reporting needs eliminating burdensome manual internal processes, and freeing up valuable time so you can focus on running your business.