Discovery of a qualified accountant for your business has always taken an exhaustive effort. The job itself is a difficult one — keeping dreamers in line with their budgets. In today’s market, it is a demanding pursuit to find top accounting talent. And it’s about to get worse — much worse. Consider that outsourcing makes sense in a tight accounting market.
Who is studying to become an accountant these days?
The American Institute of Certified Public Accountants, or the AICPA, estimates that about 75% of its members will be eligible to retire by 2020. The AICPA suggests 75% of all working accountants will retire within 15 years.
Millennials who might have replaced those retiring Baby Boomers often seek meaning and flexibility in their work. Meaning and flexibility are two life-qualities not often associated with the accounting field.
Technology has made our world much more complex.
The world has become more complex — with technology taking the bows. But, technology is partly to blame for the good, the bad, and the ugly in the complexity. Added laws and regulations make business processes more complicated. Sophisticated financial data and higher-level responsibilities have changed the accountant’s role over the past 20 years.
Accountants now require a broader blend of skills beyond crunching numbers.
The accountant in today’s world also needs softer skills and a knowledge of overall business practices — making the field more expansive than it has ever been. The essential accounting skillset of today makes accounting roles hard to fill for many companies. Even a decent accountant is tough to find most times.
There is no standardization at the universities to make accounting palatable in the business world at present.
Issues such as standardization of skillsets are part of the reason why outsourcing accounting functions have helped many companies solve the talent shortage in a flexible and cost-effective manner.
Outsourcing saves time and money as you won’t need to do an entire onboarding process before they can dive into the work. Outsourcing also gives the added benefit of being able to “try one on for size” to see if this particular person with fit within your business and its culture.
Needs at both ends of the spectrum.
Outsourcing enables companies to find reliable talent to fulfill accounting needs — often at a lower cost than in-house accountants. Using outsourcing services can solve the accounting labor shortage by addressing companies’ low-end and high-end needs.
Low-end accounting tasks can be mundane and transactional, such as accounts payable, accounts receivable, invoicing, or payroll.
These everyday tasks don’t have a huge role in a company’s bottom line, but they certainly take time and resources to complete. These activities must function well for a business to operate, but they are not competitive differentiators.
The roles that accomplish day-to-day tasks are often entry-level positions, which historically are associated with high turnover in the U.S. Ask any CFO, and they’ll tell you it takes considerable HR manpower to fill, refill, and train candidates for these roles.
By outsourcing low-impact accounting roles, you eliminate the cost, time, and effort associated with hiring, managing, and retaining a team or even one highly skilled accountant employee.
While accounting talent might be hard to outsource in the U.S., that’s not the case overseas.
Accountancy is a highly esteemed career abroad, especially at a business processing outsourcing (BPO) company. Better yet, offshore professionals have the same qualifications and certifications as those based in the U.S.
Typically, businesses can outsource accounting roles for about 50% less cost than in-house salaried work. Outsourcing companies will also manage any HR-related tasks to ensure that you have a full team operating at all times.
Using accounting outsourced services saves time, energy, and money.
The money saved gives your HR department resources that can be spent filling value-adding positions such as sales or growth roles. The reduced cost of managing your accounting needs in this manner allows companies to growth-hack its success.
Companies can do things like add new products and services, hire key executive personnel, and add marketing programs to gain more business. By getting the same quality talent overseas for less money, companies can enjoy a huge difference in its profits.
Many companies outsource lower-end accounting tasks.
Outsourced talent can handle both the mundane tasks and the more sophisticated areas like financial planning and analysis, budgeting, forecasting, and treasury.
Suppliers with delivery centers in both India and the Philippines are in the best position to offer transactional support at huge cost savings and higher-end skills that drive value.
Access to invaluable expertise.
Whether it’s higher-end work or simpler tasks, the expertise available through outsourcing is valuable for today’s needed business growth schedules. Forward-facing initiatives designed to drive business are already in place and don’t have to be taught and trained. Hiring accounting talent that is experienced, reliable, and available 24/7 can help companies put a stop to month-end fire drills.
Outsourced talent enables businesses to grow, expand, and win new business.
Examining key metrics in a timely fashion helps any business grow, and outsourcing can provide that aid.
Receiving reports consistently, on time, and with no hassle helps CFOs make more informed decisions on a regular basis. With the key information included in these metrics, business leaders will pinpoint improvements that will lead to better results.
For example, one of our clients decreased its time to invoice from six days to 24 hours — a goal it had held for a long time. Achieving this goal with in-house talent would have created a host of challenges, but an outsourcer is required to show you value every single week. Many BPOs have partnered with top U.S. companies, and they can make even your most aspirational goals a reality.
Key considerations for outsourcing accounting.
Outsourcing accounting talent offers numerous benefits, but you must first find the right outsourcing partner and establish the most efficient process for both parties. Here are four considerations CFOs and other business leaders should keep in mind:
1. Do you have well-defined accounting processes?
It can be very difficult to know which tasks are best for outsourcing without a clearly outlined accounting process. CFOs should evaluate their current systems to determine how an outsourcer can fit into their strategies.
On the other hand, outsourcing partners can and do act as consultants to create these processes. In those cases, you need a provider who is flexible, technology-agnostic, and able to white label services. Pinpointing processes and getting everyone on board helps businesses determine how best to manage services.
2. What are your ultimate goals?
Do you want to save money through outsourcing, or do you want other benefits such as process improvements? Do you want help with low-impact transactional processing, or would you rather have support in higher-end areas? Setting goals will help your outsourcing provider plan what tasks to perform, what type of talent to hire, and how best to focus the entire process.
When business leaders aren’t sure what their goals should be, a reputable outsourcer should supply some foundational metrics and goals. But if there is one thing in particular that a company requires, it’s better to establish that from the outset.
3. What level of data security do you require?
As with any other third-party service provider, you’ll need to make sure your outsourcing partner can maintain the level of security your business and industry requires. Find a provider that has complementary processes, people, and technology to protect your information from digital attacks.
What is the outsourcer’s internal process to ensure that your data is secure?
The provider should employ a multilayered approach to cybersecurity, with protection spread across computers, networks, and data. Enquire about scheduled regular backups to prevent data loss from accidental deletion, system failures, data corruption, or theft. Above all, make sure your outsourcing partner has ISO 27001 certification.
4. Does my outsourcer use my technology?
Technological compatibility can be a deal breaker for outsourcing partnerships. Going with a technology-agnostic provider is usually the easiest because the partner will be able to plug into any tech you’re already using.
Most companies spend a lot of money, time, and energy setting up their enterprise resource planning — especially related to accounting systems. Some outsourcing companies try to force clients to abandon their current technology and go with theirs, which could lead to data security issues.
Your outsourcing partner should go with what you have determined for your business technology. If you are interested in switching technology, however, the provider should be willing and able to help your business do that smoothly.
By evaluating your goals and determining what you want to accomplish, it will be easier to see the advantages that come from outsourcing your accounting needs.
As the talent pool of qualified accountants shrinks, the advantages of finding highly accomplished people holders will continue to expand. As you look for skilled outsourcing you will be able to cut your costs and fuel strategic advancement in your accounting department and beyond.
