3 Common Myths About Accounting Outsourcing Services Busted

There are numerous myths surrounding the outsourcing industry. Most of these stem from a lack of awareness and the fear of the unknown. Below are three of the primary myths about accounting outsourcing services and how they’re not as valid as you may believe.

Myth #1:  Jobs will go offshore

One of the most prominent myths regarding outsourced accounting services is that it pushes jobs overseas. This claim has been used time and again, however, there is minimal data to back this up and there are many points to actually prove otherwise.

The myth claims that because the same accounting function will now be done overseas, the people who were doing it before in the home country are now obsolete. Yes, that particular task will no longer be done in the home country, but it doesn’t mean that the staff has nothing else to do now.

Many accounting firm owners who have outsourced in the past have a similar story to share. They began outsourcing by hiring a team of two or three people overseas, and within a short span, they were able to expand their operations and needed to hire staff locally to handle the additional work.

Outsourcing high-volume, low-value work overseas frees up your time and resources which lets you focus on providing additional higher-margin services such as business advisory. By utilising an expert accounting outsourcing service provider, you not only offer traditional services to clients, but also new higher-margin services.

This actually debunks the myth that outsourcing causes jobs to go overseas. By taking advantage of outsourcing, you not only help your current staff to upskill but you’re also in a position to provide more opportunities to the local workforce.

Myth #2:  I’ll lose control of my accounting business

Most accounting firms considering outsourcing tend to get a bit caught up and feel they may lose control of their business over time. This myth tends to stem from the notion that since the work is getting done thousands of miles away in a different country, it becomes much harder to supervise and maintain.

This is understandable; however, with the selection of a quality, professional accounting outsourcing company, it doesn’t need to be a major concern.

Before any business commits to an outsourcing company, they should check on the reporting procedures, means of communication, whether there is a named manager and a dedicated team of people. The virtual accountants should operate as an internal team and with today’s rapid means of communication, such as video conferencing, Skype and so on, a remote team does not have to be remote.

The implementation phase is key to ensuring control is in place. All standards and procedures should be agreed upon before any work begins and time should be spent with the new team to establish working practices. If, in the future, the owner feels like they are losing control of certain functions, they should raise this concern with the outsourcing provider.

The practice owner should also be prepared to give up minimal control over certain processes, as that is why they have contracted the outsourcing firm in the first place. However, they should always maintain their own final authority. Regular audits of procedures should be carried out to ascertain that standards are being maintained.

In brief, the myth of losing control becomes obsolete as long as clear guidelines and open communication are adhered to.

Myth #3:  My data won’t be secure overseas

One myth that keeps popping up is about how data will remain secure when it’s outsourced to firms overseas. The only way any outsourcing business will continue to operate is by instilling confidence in its current and future clients. It’s this fundamental concept that drives accounting outsourcing companies to invest in the best data security.

Before partnering with an outsourcing company, do your due diligence from a security perspective and make sure these points are met:

• Follows world-class security standards such as ISO 27001.
• Is GDPR-compliant. Preferably via a framework such as BS 10012:2017, as it’s the only available industry code of conduct that currently aligns with GDPR requirements.
• Maintains non-disclosure agreements.

Outsourcing companies are fully aware that even one lapse will break the trust they have built up. In fact, most outsourcing companies will go above and beyond the normal security precautions to ensure data is not mishandled. If you ever feel that there is a data risk, bring it up with your outsourcing partner to find a resolution.

Building a modern accountancy practice

In this day of technology and globalisation, it’s easy to harness the true potential of outsourcing. The number of UK accounting practices that outsource accounting functions is on the rise and understandably so.

A modern accountancy practice should be composed of experts and strategic thinkers, so owners can spend less time worrying about things like year-end accounts, payroll tax, bookkeeping and VAT, and more on higher-value functions.

For more information about how your practice can start benefitting from accounting outsourcing, feel free to drop us an email at [email protected] or call us at +44 208-146-0808.