More and more accounting firms are considering outsourcing finance department. Why? They want to expand their business! But, as businesses take on more tasks, management becomes more complex. Many accounting firms make the mistake of focusing too much on carrying out day-to-day responsibilities. They don’t focus too much on activities that encourage business growth. Balancing the two is extremely tough for accounting firms, especially small-scale firms. Outsourcing can help these firms find balance.
Outsourcing Addresses the Risk of Ignoring Basic Accounting Responsibilities
Businesses that go from a ‘slow growth’ mode to ‘expansion’ mode often fail to live up to past standards of quality. Day-to-day accounting jobs, bookkeeping, tax management, and other basic responsibilities suffer as firms are focused too much on growth-related goals.
When these businesses consider outsourcing finance department, the risk of ignoring these basic responsibilities is reduced. A reliable offshore accounting team can help such businesses handle their finances while the in-house team focuses more on firm expansion.
Having two teams to manage two different, but crucial aspects of the business help promote long-term expansion goals. It becomes easier for smaller firms to manage their overhead costs while staying profitable.
Outsourcing Manages the Costs of Expansion
How can firms stay profitable while expanding? Make sure the expansion activities are cost-effective! The costs of outsourcing accounting and financial responsibilities are negligible. In developing countries, an accountant’s average salary is three to four times less than what accountants in Western countries like the UK earn. Plus, offshore accounting teams don’t require office space, bonuses, equipment, etc. So, firms get to expand their scope of responsibilities at cost-effective rates.
Being Compliant
Irrespective of the industry, every business must be compliant with local taxation rules and guidelines, mainly to expand soon. The last thing accounting firms need on their road to expansion is many regulations or compliance issues.
That’s why outsourcing your taxation responsibilities to offshore accounting experts makes so much sense. Small businesses often fail to meet their tax obligations. For the accounting firms helping these small businesses, getting every detail right is very difficult and time-consuming.
Outsourcing is the most effective way of ensuring tax compliance for accounting firms with growing lists of clients. The tax write-offs an accounting firm can receive just by partnering with one of these offshore firms are amazing.
Accounting firms can essentially kill two birds with one stone if they outsource taxation responsibilities to offshore firms –
- They get to handle their clients’ taxation responsibilities efficiently.
- They qualify for minor tax exemptions themselves!
Delegation Becomes Easier
Tactical delegation is key to business expansion. With an offshore support crew, delegation becomes much easier. After all, most small and mid-scale accounting firms don’t hire more than fifty people. So, when the list of responsibilities increases, their outsourcing contractors can step in and handle tasks like –
- Day to day accounting responsibilities
- Payroll management
- Bookkeeping
- Tax preparation
As long as outsourcing contractors use the latest accounting tools and cloud systems to collaborate over the internet, they can play vital roles in expanding any business!
