How Much Do Outsourced Audit Support Services Cost?

Outsourcing is undoubtedly one of the easiest ways for CPA firms to scale quickly and enhance their service portfolios. Cost reduction is reported to be the top reason why businesses choose to outsource. Accounting firms can truly benefit from outsourced audit support services as they fuel growth and profitability.

The average annual salary for an external auditor in the US is $98,844. At the same time, outsourced audit support services cost hardly $2500-5000 per month.

Accounting firm owners who want to reap the outsourcing path’s enormous benefits all ask, “How much does it cost to outsource audit support services?”

To understand how outsourced audit support services companies price their services, you need to understand the different engagement models and determine what would suit your firm’s requirements.

Factors Influencing Costs:

Several factors impact the cost of outsourcing audit support. The complexity of the audit itself is a major determinant—more intricate financial landscapes require more expert analysis, driving up the cost. Geographic location also plays a role; firms located in regions with higher costs of living may face higher charges. Additionally, the experience and reputation of the outsourcing firm can affect pricing. More reputable firms with a track record of success typically command higher fees but also bring added reliability and expertise that can prove beneficial in high-stakes audits.

Cost Comparison and ROI:

When considering the costs of outsourced audit support, it’s crucial to also consider the return on investment (ROI). While the initial outlay for a reputable outsourcing firm might seem high compared to hiring in-house, outsourcing eliminates the need for ongoing training, software upgrades, and other overhead costs associated with maintaining an audit department. Moreover, the ability to scale support up or down as needed provides cost-efficiency that hiring additional permanent staff cannot offer. Firms should conduct a thorough cost-benefit analysis, considering not just the direct costs but also the potential for increased revenue and client satisfaction through higher-quality audits.

Engagement Models Explained:

Typically, outsourced audit support services offer several engagement models, each tailored to different types of needs and budgets. The most common models are per-project, hourly rates, and full-time equivalent (FTE) pricing. Per-project pricing is ideal for firms that need support for specific, limited-duration audits, offering a fixed cost that helps with budgeting and financial planning. Hourly rates suit those who require flexibility, particularly if the scope of work is variable or unpredictable. Meanwhile, FTE pricing involves paying a set fee for the equivalent of a full-time professional, which can be cost-effective for continuous, large-scale audit support.

What are the Different Engagement Models in Outsourced Audit Support Services?

Each accounting firm has its requirements based on what its clients need help with. Therefore, the best outsourced service providers offer custom pricing models to suit every need. There are several engagement models based on location, the scope of work, budget, and other criteria.

Location-Based Engagement Types In Outsourced Audit Support Services

Depending on your preference, you can engage in any of the following models:

On-site- The outsourced staff will work from your office premises for a given period.
Onshore: Wherein the outsourced accounting professional will work within the same country but outside the organization.
Nearshore: The outsourced service provider will work from a neighboring or nearby country, perhaps in the same time zone.
Offshore- In this engagement model, your outsourced staff will work from a distant country.

OUTSOURCED AUDIT OUTSOURCING MODELS BASED ON THE SCOPE OF WORK & BUDGET:

Full-time Employee (FTE) Model:

The FTE pricing model is the most preferred engagement type for outsourced audit support services. According to this, the outsourcing provider will be paid on the basis of the number of people logged in. This model offers accounting firms a dedicated full-time resource who will work exclusively for them. The outsourced audit support services provider typically bills the accounting firm monthly against the resources’ time. If you own a CPA firm with a high and consistent amount of work, this is the perfect choice of engagement model for you. In this engagement model, the dedicated team or individuals will work exclusively on your projects under your supervision and in a controlled environment alongside senior management supervision. Each FTE resource will get in touch with you to understand your requirements and execute the project accordingly.

Benefits:

Flexible price structure, dedicated staff working exclusively on your project and per your time zone, quick scalability & profitability, cost-effectiveness, and seamless communication.

Ad-hoc or Pay as You Go Model

The ad-hoc model for compliance and audit support services perfectly suits accounting firms that do not have high volumes of work or many clients. CPA firms opt for this model when their clients are looking for audit services and when there is a requirement. The outsourcing service provider designs the payment structure and bills the resource according to the number of hours they offer outsourced audit support services. Under this model, the outsourced staff will work exclusively for your accounting firm, which is considered more economical than hourly rates, especially if your clients give you high volumes of work. This model might not be suitable if your accounting firm has large volumes of work or if you have many clients.

Benefits:

You will be paying for the number of hours of work you outsource only, quick scalability & enhanced profitability, better service guarantee, consistent service and good employee morale, more economical than other engagement models, and unlimited email and phone support.

How To Choose the Right Engagement Model for Outsourced Audit Support Services?

Choosing among the several engagement models might be challenging. However, deciding on the best model to suit your project can be done by setting the requirements straight and determining if your service provider is competent enough with the necessary infrastructure, budget, and deadlines.

OVER TO YOU

When it comes to outsourced audit support services, there are several choices for outsourcing partners and their corresponding engagement models to choose from. It is best if CPA firms are sure about their exact requirements and zero in on an outsourcing partner that best fits their bill. The typical cost of audit support services depends on several factors. But it can save you 40 -60% of costs when you sign up for outsourced audit support services.

Hiring an in-house audit support team includes their salaries, recruitment costs, training costs, office space & equipment, management costs, and other employer costs such as insurance, holiday pay, sick pay, maternity pay, phone & electricity bills, etc. You can minimize or perhaps even cut most of these employee-related costs by outsourcing audit services. Cost-effectiveness doesn’t just mean you save money but also that it gives you the time and resources to scale your accounting firm.

Improve Audit Efficiency with QXAS’ Outsourced Audit Support Services

Did you just google “affordable outsourced audit support services near me?” Well then, your search ends with us. We at QXAS provide the best quality audit support services for your CPA firm without the expensive price tag usually attached to hiring an experienced set of audit professionals. With an easy onboarding process, you can interview our candidates, and our approach is so seamless that you can also onboard the audit specialists of your choice within 48 hours.

From greater profitability and quicker turnaround times to an enhanced service portfolio and more time to innovate and scale, QXAS’ audit support services offer enormous benefits to CPAs and accounting firms.

Why QXAS?

India’s first GDPR & SOC 2 compliant accounts outsourcing company
Less tedium & more precision guaranteed as our highly qualified auditors will take the tedium out of auditing
Over 12 years of experience in outsourced audit support services & accounting outsourcing
Quick onboarding: Seamless process via which you can interview and onboard preferred candidates within 48 hours
Listed under IAOP’s top 100 global outsourcing list
100% quality & security assured as we fully comply with ISO 27001 for information security and ISO 9001 for quality.

Book a Consultation

We hope you enjoyed reading this blog. Book a call to learn how our outsourced audit support services can help your accounting firm scale quickly.

Divya Ramaswamy

Divya is an established voice in the accounting industry, known for her incisive articles that guide CPAs on navigating outsourcing challenges effectively. With a knack for distilling complex data into actionable advice, she helps professionals make informed decisions to enhance their practices.

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Originally published Aug 23, 2024 12:08:57, updated Sep 10 2024

Topics: audit support services