Outsourcing Accounting Services

Outsourcing Accounting Services in the Philippines

Many small businesses find it challenging to hire an accountant. Especially with the right skills to prepare their company’s financial statements, manage bank account operations, analyze financial data, and prepare the outgoing invoices. Nowadays, it is even more challenging to find a qualified and eligible person at an affordable rate. More than 1/3 of small businesses are outsourcing their accounting. Interestingly, most small companies who outsource are not feeling comfortable doing accounting on their own.

Even though it is commonly believed that accounting and bookkeeping must be done inside of the business. But it is essential to ask yourself whether you have the necessary skills and experience to do this job. Also, do your staff has enough experience to coup with increasing accounting tasks. To add it up, 62% of all small businesses they think that they overpay their taxes. Due to this fact, you might consider outsourcing accounting services to the company that is with the right knowledge and qualifications. Also, which company can do the same job more qualitatively and cost-effectively.

What is Accounting Outsourcing?

Accounting outsourcing is the business strategy of outsourcing a portion or all of the accounting functions necessary to keep the business operational. While the concept of outsourcing is often associated with small and medium sized businesses, large corporations may also outsource their accounting needs to a reliable accounting service. There are a number of reasons why a company would consider accounting outsourcing, with most of the reasons focusing around making the best use of the resources available to the business.

Reasons for Accounting Outsourcing

1. Reduced Cost
Businesses who are outsourcing accounting is willing to reduce their expenses but most importantly, without reducing the quality. The savings that outsourcing usually provides can be quite considerable as most companies can offer their services at the lower cost rates (typically due to lower labour costs at their location). Besides, by outsourcing, you save money on paying the salaries, taxes, office supplies and benefits for the full-time or part-time employee. You only pay for what you need. There is no loss in productivity costs that come along with hiring full-time employees.

2. Work Efficiency
The talent pool that outsourcing provides is very much qualified and efficient for the tasks that business client needs. Outsourcing may offer you the possibility to hire a professional with a higher level of expertise at an affordable price.

3. Time Saving and Flexibility
As your business grows, you will find yourself spending more time managing your money and less time scaling the business. Therefore, the outsourcing administrative tasks like bookkeeping and accounting help you to focus your time, energy and resources on creating the business strategies. It will be bringing more revenue, as well as networking and building relationships with your customers. The accounting service providers have the amount of availability to scale your services significantly without any lag. For example, if your bookkeeping and accounting tasks exceed the number of functions for 1 employee, you can easily be enforced with the extra workforce without the need to go through a rigorous recruitment process. Moreover, accounting and bookkeeping service providers are charging on an hourly basis. It means you can scale-up or scale-down the hours without any interruption.

4. Automation accounting
Most businesses use accounting automation software to save time. It will save time, but importantly, it reduces risks. Automating accounting is minimizing human errors. Secondly, in automation software, accountants get real-time reports. They assist in catching potential problems and resolving them in an early stage. Thirdly, it will reduce the probability of internal fraud. Most of the accounting service providers are highly qualified in the automation tools such as Quickbooks, Sage, Xero and more. If your accountants are still using only Excel sheets – you are wasting your time and money.

5. Advisory Service
A good accountant will always provide advice on how to make accounting more efficient. Sometimes he might work with a couple of companies and propose an excellent experience from another client. Whether it is about taxation, accounting software or even provide financial advice.