Why Do Companies Outsource
Accountants? (And how to maximize their skills)

The increasing popularity of outsourced accounting services among SMEs is rooted in a strategic desire to access top-tier financial expertise.

Outsourcing full-time accountants presents a range of strategic advantages for businesses. For SMEs looking to optimize their operations, this decision goes beyond simple cost reduction. It encompasses a host of benefits that contribute to improved efficiency, scalability, and overall business success.

Unveiling the Reasons Why Companies Outsource Accountants

The increasing popularity of outsourced accounting services among Small and Medium Enterprises (SMEs) is rooted in a strategic desire to access top-tier financial expertise while mitigating the hefty costs and resource allocation associated with maintaining an in-house accounting team.

This shift towards outsourcing critical financial functions represents a paradigmatic evolution in how businesses approach their operational dynamics.

Cost Savings on Salary and Operational Costs

One of the primary drivers behind outsourcing full-time accountants is the substantial cost savings (that can be up to 75%). In many outsourcing locations, the cost of skilled labor is significantly lower than in developed countries, allowing businesses to access professional accounting services at a fraction of the cost.

Access to Skilled Global Talent

Outsourcing enables businesses to tap into a global talent pool. By sourcing accountants from countries known for their expertise in finance and accounting, such as the Philippines, businesses can acquire highly qualified professionals with diverse skill sets and industry knowledge.

24/7 Operations and Increased Productivity

Outsourcing to countries in different time zones allows for around-the-clock operations. This ensures that financial tasks are being attended to continuously, leading to increased productivity and faster turnaround times, especially when dealing with tasks that require regular attention.

Focus on Core Competencies

Recruiting outsourced full-time accountants allows businesses to redirect their in-house resources toward core competencies. This lets onshore teams concentrate on mission-critical activities that directly contribute to business growth and innovation.

Scalability and Flexibility on Workload

Businesses can easily adjust the number of offshore accountants based on their workload, allowing for flexibility during peak seasons or business expansion without the complexities of hiring and training additional in-house staff.

Expertise and Compliance

Outsourced accountants are often well-versed in local tax laws and financial regulations, ensuring that businesses remain compliant with relevant legislation. This expertise is particularly crucial for companies operating in multiple jurisdictions.

Access to Advanced Technology

By outsourcing certain accounting roles, businesses not only gain access to technological advancements without substantial upfront investments but also ensure enhanced data security. These service providers are equipped to implement robust data protection measures, safeguarding sensitive financial information, and mitigating the risks associated with cybersecurity threats.

This dual advantage of technological prowess and stringent data security measures makes offshoring a compelling strategy for businesses aiming to stay technologically competitive while prioritizing the confidentiality of their financial data

Risk Mitigation

One of the primary benefits of outsourcing roles lies in its ability to mitigate the risks linked to staff turnover. Employee attrition, a common challenge faced by businesses, can disrupt the seamless flow of operations, especially when dealing with specialized tasks such as accounting.

Through this, businesses create a buffer against the impact of staff turnover. The offshore professionals become integral components of the extended team, ensuring that there is a continuous and reliable workforce dedicated to accounting responsibilities.

Maximizing Offshore Accountants Contribution

The role of an outsourced accountant extends far beyond basic bookkeeping. These professionals play a pivotal role in key financial functions that drive business success:

Financial Planning and Strategy

Leveraging the expertise of outsourced accountants can help businesses develop robust financial plans aligned with overarching strategic goals. This proactive approach helps optimize resource allocation, manage risks, and ensure the financial sustainability of the enterprise.

Budgeting and Resource Allocation

Beyond recording transactions, outsourced accountants play a pivotal role in budgeting and resource allocation. They collaborate with management to develop comprehensive budgets, allocate resources efficiently, and track financial performance against predefined benchmarks.

Cost Analysis and Reduction Strategies

These professionals delve into cost analysis, identifying areas where cost efficiencies can be realized. By conducting thorough evaluations, outsourced accountants contribute to the development and implementation of cost reduction strategies, enhancing overall operational efficiency and profitability.

Cash Flow Management

Efficient cash flow management is crucial for the sustained health of any business. Outsourced accountants specialize in monitoring and optimizing cash flows, ensuring that the company maintains adequate liquidity to meet its operational needs. This role extends to forecasting future cash flows, allowing businesses to plan and strategize for potential fluctuations.

Regulatory Compliance and Risk Management

Outsourced accountants stay abreast of changes in tax laws, financial regulations, and compliance requirements, ensuring that the business operates within the legal framework. Additionally, these professionals actively engage in risk management, identifying and mitigating financial risks that could impact the organization.

Performance Measurement and Key Performance Indicators (KPIs)

Playing a crucial role in performance measurement, these professionals assist in defining and tracking Key Performance Indicators (KPIs). This involves developing metrics that align with strategic objectives, providing management with valuable insights into the company’s financial health and operational efficiency.

Implementation of Accounting Systems and Technologies

Embracing technological advancements, outsourced accountants contribute to the implementation and optimization of accounting systems. This involves selecting and integrating cutting-edge technologies to enhance efficiency, automate routine tasks, and improve the overall accuracy of financial reporting.

Advisory Services

Serving as financial advisors, outsourced accountants provide strategic guidance to businesses. Drawing on their extensive financial knowledge, they offer insights into potential growth opportunities, financial risks, and overall business sustainability, fostering informed decision-making at the managerial level.

Want to outsource accountants? Get in touch with the MVP team!

It’s easy! Contact us to know more what benefits you can get when you outsource your own team of accountants.