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The Main Advantages of Outsourcing Accounting Services

An accountant is someone who can assist you in managing your business. Accounting can be outsourced in the interests of business in order to reduce financial costs and minimize risks. 

Attracting resources from a third-party organization is beneficial if the manager does not have the opportunity to organize an accounting department or hire a full-time accountant. For example, you may require the services of a real estate accountant, a tax accountant, and so on to ensure that your firm runs well.

What is accounting outsourcing?

There are 4 main types of outsourcing in the accounting department of various business entities:

Consulting

Where in-house accountants are available, there may be a need for supervision and assistance from a professional in one or more areas of accounting and reporting. Advice on changes in legislation or for tax optimization purposes is always useful.

Complex

If the organization doesn’t have an accounting department or the head has a need to liquidate (reorganize) the structure, the selected third-party accounting firm receives all powers.

Partial

An external resource can receive selected permissions. Example: preparing a tax return. It is used to unload staff members or for the sake of control.

Hiring an external chief accountant

In this case, the outsourcer signs accounting and tax reporting documents and acts as the chief accountant of the enterprise without restrictions.

How to decide on outsourcing?

The decision is made by the owner or head of the business, based on the needs of the company. In each case, circumstances dictate the preference or desirability of involving remote accounting.

Preference

A small or medium-sized network business that doesn’t have enough resources to organize a service center for all business entities transfers authority to an outsourcer with regional branches.

Desirability

In a large successful business that doesn’t need an "excessive" staff of accountants, the processes are already well-established. Saving resources is desirable, but not mandatory. The need for outsourcing is viewed through the prism of professional accounting optimization and risk minimization.

Benefits of outsourcing accounting services

An employing company entering into a long-term contract with an accounting company for the provision of outsourcing services receives several benefits at the same time:

Time

The most important resource is released, directed to solving urgent business problems instead of thinking about seemingly impossible ones. Accounting operations have been worked out and are faster than usual.

Money

Interchangeability and uninterrupted service during the transfer of authority lead to an overall reduction in costs (for premises, office equipment, software, stationery, etc.).

Staff

Elimination of personnel risks (temporary disability, maternity leave or vacation, etc.) and additional costs (training courses, internships, etc.) in the absence of the need to maintain an extra department.

Optimization

The efficiency of work increases and the profit from the accelerated production process increases.

Confidentiality

The outsourcing firm signs an agreement, which must include a clause on non-disclosure of information received from the Customer.

A responsibility

The contractor is responsible for the possible risks of the employing company. The contract specifies the terms for the performance of the ordered services, fines, amounts of penalties, etc.

Quality

Experienced accountants, who are obliged to constantly improve their skills and manage several orders at the same time, are qualitatively an order of magnitude higher than the average accountants.

Becoming a client of an accounting company, the head of the company personally acquires a number of advantages:

  • Time to focus on doing business
  • Ability to distract from personnel problems
  • Confidence not to depend on an "irreplaceable" employee
  • Savings to pay for specific results of work
  • Security, so as not to be responsible for the flaws made by the chief accountant

The cost of services is calculated depending on the taxation system adopted at the enterprise (organization) and the number of transactions performed for a certain period (usually for 1 month).

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