BusinessVein

In today’s article we are going to discuss current issues in the world of accountancy outsourcing. This relates to outsource bookkeeping, outsourcing payroll, taxes and many other business processes. Other processes including managing finances, investment analysis, forensic services, valuations and inventory management.

Businesses who have obtained services of offshore bookkeepers may have faced mixed experiences. Your offshoring experience may have suffered some troubles, so in this case you are likely to be deprived of benefits of outsourcing in future, or you may have some very extra-ordinary experience, in this case you may become lenient about your accounting books. Both are dangerous for your business.

Today businesses who are considering to avail or have availed services of outsourcing firms need to consider 3 primary factors. The more favorable answers to these factors represent a more successful outsourcing experience. The less satisfactory answers (or no answer at all) should cause some point of concern at both end of BPO provider and BPO availer.

The first factor is REPORTING. In reporting we ask following 3 questions.

-i)   Is there an increase or a decrease in kind of reports provided?
-ii)  Are we getting reliable reports?
-iii) Are the reports provided to us in-time?

All these things in reporting are important. Your dear outsource provider may be providing you more detailed analysis than your current in-house accountants (and vice versa). There is also a concern of reliability of reports, because most of the business decisions are based on reports generated by accounts.

Second factor to consider is MONEY. You again need to ask three questions related to costs of outsourcing and costs of not outsourcing.

-i)   How much you can save by outsourcing your accounts department?
-ii)  What are your indirect cost savings
-iii) What other non-financial savings you can make by outsourcing?

These three questions are relatively easy to decide. Normally hourly rate charged by an offshored accountant is much less than accountant in adjacent room. Indirect benefits are reduction(or end) in cost of office supplies, lunch vouchers, allowances and benefits for in-house employees. However third question is important. Have you thought that having an outsourced accounts department may reduce conflicts between your core staff and accounts department? Is it likely that outsourcing would give satisfaction to existing sales team that their salaries are being prepared by professional firms?

Last and most important factor is SUSTAINABILITY. here would look 3 factors that cover sustainability.

i)   For how long your outsourcing partner is going to support and maintain your accounts?
ii)  What are the terms of disengagement?
iii) Do you have or do you need an alternate/fallback option?

Well… if you are aiming for a long-term business, then you should also choose a partner who can work with you in the long-run. So try to be with more reliable partners. Second this is what if other firm winds up or doesn’t want to work with you, will they be leaving you at a safe spot so that you may continue ahead, or will they be providing guidance even after dis-engagement? And at last, but not least, is it necessary to maintain a fallback plan, if your offshorer fails to comply with any terms, do you have any way to safe your side? Well this last thing depend on nature of your business and the volume of dependence on outshorer. However, in normal conditions it is not necessary to maintain a backup plan because it’ll cost.

Tags: accountancy outsourcing, Accounting, business process, investment analysis, managing finances, offshore bookkeepers, offshored accountant, outsource bookkeeping, outsourced accounts, outsourced accounts department, Outsourcing, outsourcing payroll, taxes

This entry was posted on Sunday, February 7th, 2010 at 2:38 PM and is filed under Accounting, Bookkeeping, Outsourcing, Payroll. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.