Outsourced accounting is a popular choice among businesses that want to reduce their overhead expenses without affecting efficiency.
It provides accounting firms with an offshore extension of their team and the freedom to focus their energies on growing and managing their business rather than getting bogged down with repetitive back-office tasks.
What types of accounting functions are most commonly outsourced?
Many functions can be easily outsourced to qualified staff offshore. In Australia, the most commonly outsourced functions include:
- Tax and Compliance services
- SMSF services
- Bookkeeping and Payroll services
What are the benefits of outsourcing?
Perhaps the biggest benefit outsourcing provides for accountants is the ability to quickly respond to changing client or legislative requirements and maintain high quality client service.
- Improved practice efficiency
When your offshore team is taking care of the day-to-day work for you, you’re able to shift more of your focus to your business operations. You have the capacity to be proactive rather than reactive, you can focus on strategies to win more clients and you have the time to identify any potential bottlenecks within your business.
- Ability to scale quickly as needed
Outsourced accounting allows you to scale quickly in response to increasing client demand. Unlike the recruitment of local resources, scaling your offshore team means you don’t need to invest in the infrastructure and onboarding of new staff – instead your outsourced provider will take care of it for you.
- Source qualified staff on demand
When an employee leaves your practice, you lose valuable skills and experience that can be hard to replace. Hiring local staff takes time and effort, and the training and onboarding of a new staff member can take months.
The advantage of outsourced accounting services is your service provider can find qualified offshore staff for you. They’ll also train new staff and provide ongoing management to help protect the continuity of your business.
Choose your outsourcing model wisely
Outsourcing can be provided as an Ad Hoc, Build and Transfer or Account Managed Service model.
- Ad Hoc – As the name suggests, the ad hoc model is suitable for projects with short lifecycles and can be good for short term support requirements.
- Build and Transfer – The build and transfer model can be useful if you’d like to outsource the creation of your team, but ultimately want the entire operation and ongoing HR management handed back to you for ongoing management.
- Account Managed Service – If creating maximum efficient and internal capacity is your goal, an account managed service model allows you to retain control and visibility, while leaving time consuming HR management, quality control and day-to-day operations management to your outsourced provider.
To ensure you make the best decision for your firm, it’s important to be clear on your outsourcing goals and select the model that will help you achieve them.
Outsourced accounting is not new, but more and more accounting firms are starting to see the benefits of being able to take a more strategic approach to operating their business. Increased pressure on accountants from both clients and regulators is ever increasing, and by engaging an outsourced account service, you’ll be able to lighten the workload within your practice.