Regardless of whether you’re an entrepreneur, a small and medium-sized (SME) business, or a large
corporation, there are some immediate advantages to outsourcing accounting overseas. Accounting is one of the primary business functions that companies typically outsource, with 37% of SMEs choosing to outsource their accounting and bookkeeping. So, why do so many companies look offshore for financial outsourcing solutions?
1. Reduced Expenditures
Outsourcing accounting allows businesses to benefit from lower head counts, reduced payroll, and lower operating expenses. In addition, companies save a considerable amount of capital by outsourcing accounting as opposed to maintaining a full-time accounting department.
A full-time internal accounting team means companies must cover the costs of salaries, training, employee turnover, insurance, and employee benefits. Outsourcing accounting and bookkeeping responsibilities overseas can significantly reduce these costs.
Financial services outsourcing solutions are not just for SMEs. Larger financial institutions also benefit from outsourcing. In fact, according to Fortunly, larger companies are 66% more likely to outsource accounting than their smaller competitors. Moreover, even financial services benefit, with 71% of financial service companies outsourcing all or a portion of their accounting services to overseas firms.
2. Save Valuable Time and Company Resources
Ultimately, outsourcing accounting offshore can immediately save companies time and resources. This allows companies of all sizes to focus on growing their business. They no longer have to spend an excessive amount of time making sure their financials are up to date and compliant with third-party
regulatory authorities. This is an immediate benefit to companies of all sizes as it allows them to devote critical resources to other areas of their business.
3. Benefit from Financial Consultancy
Finance and accounting outsourcing companies in the Philippines also act as financial consultants. It’s their job to guide you on the ins and outs of business finance. Whether it’s helping you navigate the complex world of business financing, loans, and credit lines or helping you with new capital expenditures, these offshore firms are excellent financial resources.
Many SMEs and larger corporations see their offshore accounting firms as critical partners. They rely upon them to keep their business up to date with emerging trends and all things finance-related. In addition, companies view their overseas accounting firms as key contributors and value their insight on finance issues.
4. Greater Visibility on Cash Flow
History is full of companies who had excellent products, fantastic service, and great reputations but couldn’t survive because they didn’t have a handle on their cash flow. Industries with long receivable collection times are especially at risk. Providing 90, 120, or even 150-day terms may be a requirement in
some industries and markets, but it doesn’t mean your business has to be strapped for cash.
Outsourcing accounting and bookkeeping to an overseas firm means you’re working alongside a partner who will constantly keep you informed on your cash flow position. They will also advise you on different financing options that can help alleviate the high costs of long receivable collection times. This is critical to helping you manage your cash flow so you can make informed decisions about new hires and expansion.
5. Tax Credits
According to the Global Finance and Accounting Outsourcing Industry Report, the outsourced accounting industry is expected to grow at a compound annual rate of 5.9% and reach US$53.4 billion by 2026. A big reason for that growth is that offshore accounting firms are excellent at helping businesses maximise tax credits. Whether that involves assisting companies in navigating R&D tax credits, reducing the company’s overall tax burden, or simply identifying cost-cutting strategies that will improve the business’s bottom line, outsourced accountancy firms are excellent financial resources.
6. Expertise from an Unbiased Third-Party
Unfortunately, business fraud and embezzlement are a reality in today’s global economy. There are plenty of stories of employees who have defrauded their employer, only for the employer to find out years later. Unfortunately, by the time the business discovers the fraud, it’s often too late to do anything about it.
Working with an overseas financial services outsourcing solution provider means you benefit from an unbiased third-party resource. They manage your bookkeeping and will be the first to point out any accounting discrepancies. While this doesn’t eliminate fraud, it does provide some comfort knowing that your partner is looking out for your business’s best interests.
7. Improved Performance on Independent Audits
Finance and accounting outsourcing companies in the Philippines know how to prepare your business for audits. They are expert accountants and will give you the most up-to-date financial numbers by providing accurate monthly financial statements. So regardless of whether your business needs to be audited annually or periodically by a government regulatory authority, you can be confident knowing your business will be ready.
enableSME’s Complete Outsourcing Solution
Outsourcing your accounting and bookkeeping to enableSME allows you to divert your most vital resources to growing your business. Aside from working with our customer-centric outsource team, you’ll also have your own enableSME Account Director and access to the entire enableSME management team. We’ll help you reduce costs and improve your cash position. To find out how, contact us now.