Debunking common myths about outsourced accounting
Finance and accounting is a crucial element of running a business. It, therefore, becomes essential to have a good team of accountants handling your company’s finances. While it isn’t a problem for big organizations to have an efficient in-house accounting and finance department, small businesses struggle to manage in-house employees for various tasks and jobs. Outsourced accounting, as a result, became a popular solution. Companies, big and small alike, stand to gain significantly by outsourcing accounting services to reliable offshore vendors. It is an effective way of cutting down costs while getting access to quality services.
Yet, some companies are hesitant about considering offshoring for their accounting needs. Over the years, certain myths have sprung up around outsourced accounting that has cast shadows over the concept and its worth. Any new change in business comes with its own set of challenges and risks, but that doesn’t necessarily make it unfit to be incorporated. Don’t let the misinformation around you impact your decision of outsourcing. Below we debunk some of the common myths about outsourced accounting.
It is for big companies
Often the concept of outsourcing is associated with the giants in the business world. You say outsourcing, and you think about big companies hiring employees offshore to work for them. But it’s completely untrue. While it may have been the case decades ago when globalization was in its infancy and technology was making advancements still, now the situation has changed. If anything, outsourcing services to offshore providers is mostly done by small businesses to help them save money. Accounting requires great care and attention, for it paints a picture of your company’s finances, which ultimately influences any business decision. But as small businesses are unable to hire in-house accountants without making considerable expenses, outsourcing allows them to achieve the same results at a reduced cost. The providers have various pricing models and services to cater to the needs of startups and small businesses. If you can’t have in-house employees, outsourcing is an excellent alternative.
The company won’t have control over the finances
It’s not easy to hand over such a vital function to someone else, we understand. But it is precisely because of its importance that you require the best people working on this service. You need your financial accounts to be handled by capable and experienced professionals who know what they are doing and how best to go about their work. Offshoring accounting services allows you to achieve this without the loss of control. It’s your company and your finances; the providers understand this. Technology and the internet now allow you to interact, communicate, monitor, and manage the processes as and when you like. These are employees working for your company, and you decide how much control you exercise over them. This way, you have control over the accounting processes, and your company’s finances are in control as well.
It’s not secure
It is natural to think twice about outsourcing accounting as it involves such sensitive information. One of the most common worries in this matter is usually about the safety of the company’s data. But saying it isn’t secure would be false. Offshore providers realize the importance of security when dealing with such sensitive information for their clients, and thus have some of the highest safety protocols in place in their offices from where the employees work. It might be even more secure than your in-house IT infrastructure. The providers use the best technology, tools, and safety measures to avoid any cyber-attacks or online data breaches. For further protection, a reliable offshore provider will even have their employees sign NDAs. You can ensure the safety of your company’s data by having the provider sign the necessary forms and documents as well.
Company will still need an in-house accountant
This isn’t true for all companies and entirely depends on the company. Outsourcing is meant to reduce your workload and tension so you can focus on areas more important or central to your business. Hiring an in-house professional while outsourcing accounting services becomes redundant. If a company feels the need to have in-house accounting expertise and monitor the outsourcing results, it’s their own choice. Although, sometimes, companies prefer to outsource only specific tasks in accounting instead of the entire department. In that case, it makes sense that your in-house team manages the important jobs in accounting while you have offshore employees handling the process-driven tasks. It is your choice how you choose to proceed. No hard and fast rule applies here.
These are the four common myths that usually make a company think twice before outsourcing their accounting services. Hopefully, we could help throw light on the truth and alleviate some of your fears with this post. So you don’t need to hold back from outsourcing accounting services to an offshore provider if your company is struggling and can easily benefit from it.