Daily activities like recording transactions, reconciling accounts, handling invoices, and keeping track of financial data, which are the basic operations for most CPA firms, can really eat up your whole day. In fact, they often cause you to get distracted and unable to think properly about tax planning, financial consulting, and even client relations.
Here, an offshore accounting service is your answer. You don't have to worry about assigning those daily activities to an offshore team as they will not in any way compromise the quality and the deadlines of the work, plus they will not interfere with your direct communications with the client.
Why CPA Firms Are Outsourcing Bookkeeping
Accuracy is part of regular accounting work. When a firm gets bigger, doing every accounting task in-house can be a big burden for the staff.
Delegation of non-core work to external vendors can relieve the accountants who work full time from getting burdened down with mundane duties and enable them to concentrate on more strategic issues.
The list below contains the primary reasons for which CPA firms look for an external bookkeeping provider:
- Keeping up with growing bookkeeping volumes
- Offloading repetitive administrative chores
- Helping clients during tax rush time
- Getting faster results
- Drawing from a broader team of accounting experts
- Releasing CPAs into more value-add roles such as advisory and tax-related ones
Yes, outsourcing services are not the answer to cutting costs eventually but it can work as adding more accounting capacity and resources at the firm's disposal.
What Daily Bookkeeping Tasks Can Be Outsourced?
CPA firms can hand over certain activities to a team abroad. They can be customized to the firm's workflow and meet the clients needs. Some of the routine jobs are:
Keeping Track of Transaction Offshore employees can keep a record of all the sales expenses payments, and other financial transactions based on the company's rules and policies.
Bank and Credit Card Reconciliation
Frequent reconciliation is a means of revealing differences between the book and the bank or credit card records.
The team abroad can do this work of reconciliations at the end of each period and highlight those transactions which are abnormal or at least unusual to submit the matter for further review.
Accounts Payable and Receivable
Teams can help with invoice processing, keeping the books updated when there's a payment, as well as recording and updating the amount owed.
Paying Attention to Detail
In most cases, a remotely located, bookkeeping team will get the accounting done and the team will then generate the most basic types of financial reports like:
- Income and expense statements: these are also called profit and loss statements
- Balance sheets: Showing what was earned and what remained at year's end.
- Cash flow reports: Showing what kind of money moves come in, how much goes out and which cash items remain
- Accounts receivable aging reports: Reports on the accounts that need to be paid and the amounts of each that are due
Before the information gets to the client, the CPA or senior accountant can be a check on the data.
How the Offshore Bookkeeping Process Works
Outsourcing often involves having clear definitions of the different roles of the people and teams involved.
A good example of the procedure might be:
- Look into your business operations and determine which types of work are repetitive (i.e. work that could be done easily by someone else). You'll want to know which jobs of yours eat up a majority of the time and effort of the internal staff.
- Assign roles & responsibilities: work out procedures with your offshore team for doing the data inputting and reconciliations, generating reports and conducting audit checks.
- Decide on means of communication and collaboration: Agree to what communication medium will be used by offshore staff to get instructions, clarify things and report back work done.
- Provide access to necessary work areas: give the offshore team access (to the appropriate extent and under supervision) to the accounting software and related documents.
- Quality Assurance review: Internal accountants check and review work as quality control is one of the main functions of the firm.
- Optimize workflow: keep on measuring metrics of productivity, quality and flow of communications to come up with points of the process that could be better done or improved over time.
Benefits of Outsourced Accounting Services for CPA Firms
Using Outsourced Accounting Services can give CPA firms additional flexibility without requiring them to immediately expand their permanent in-house workforce.
Key benefits can include:
- More capacity: Additional bookkeeping support can help firms manage larger workloads.
- Better time management: CPAs can spend more time on advisory, tax, and client-facing activities.
- Scalability: The level of support can be adjusted as client demand changes.
- Consistent processes: Dedicated teams can follow standardized bookkeeping procedures.
- Cost management: Firms may reduce some of the costs associated with maintaining additional full-time staff.
However, outsourcing should be treated as a managed business process rather than simply handing over bookkeeping work. Clear instructions, access controls, quality checks, and communication are important for maintaining reliable Accounting Services.
What Should CPA Firms Look for in an Offshore Team?
In order to make the right outsourcing choice that fits their business, CPA firms should pay close attention to several key operational factors:
- Working experience and understanding of the U.S. accounting rules
- Proficiency and knowledge of accounting software commonly used in the U.S.
- Implementation of data protection and restricted access processes
- Communication and responsiveness
- Quality assurance activities
- Adaptability to changing volumes of work
- A clear pricing structure and service level agreement
- A demonstrated history of work with CPA firms
Undertaking a short-term or mini-outsourcing project is a good way to find out whether the team is delivering accurate work that communicates well and is meeting dead lines on time before scaling up the partnership.
Handing over the daily bookkeeping to a team in a different country will provide CPA firms the benefit of working through problems with the help of a second team while keeping focus on higher-level jobs with their own employees. Everything from recording transactions and doing the accounting reconciliations to processing payments and issuing reports, a large number of repetitive jobs that are considered lower-value can quite easily be handed over, as long as well-established procedures are followed.
Getting it right mainly involves defining roles clearly, continuously checking on the quality of the output, preserving the confidentiality of financial data, and making the right decision when it comes to selecting an outsourcing partner.
