Businesses are looking to leverage cost-effective solutions. It will happen while maintaining compliance with the regulatory landscape. Offshoring accounting functions has emerged as a strategic choice. It is crucial for many US-based companies seeking to streamline their financial operations. Accounting firms are held to a higher standard of regulatory compliance. It seems while comparing to other businesses. After all, they need to take additional steps to ensure compliance. In this article, Fino Partners, trusted for accounts outsourcing services, will share seven steps to help businesses integrate offshoring into their finance processes.

Ensuring compliance while offshoring

CPA and accounting firms in the US need to ensure compliance. They should keep in mind seven steps when offshoring finance. It involves:

1. Conduct Regular Audits

Accounting firms should conduct regular audits. It ensures ongoing compliance. These assessments should include a review of offshore service providers' compliance. It applies to regulations and an evaluation of data privacy measures. Firms should engage an independent auditor to conduct these assessments. Thus, it provides recommendations for improving compliance.

2. Maintain Confidentiality

Maintaining confidentiality is an essential area of business. It helps in handling sensitive financial information. CPA and accounting firms should ensure that offshore service providers have appropriate data security measures. It involves firewalls, encryption, etc. Companies should also establish protocols for handling financial data. After all, firms should ensure that the offshore service provider complies with privacy laws.

3. AICPA Protocols: Compliance

The American Institute of Certified Public Accountants (AICPA) gives some protocols. It guides offshoring accounting. Accounting firms should ensure that offshore service providers follow these guidelines. It includes maintaining independence, complying with the AICPA Code, etc. It also ensures that the work is performed or not. Firms should also ensure the offshore service provider is licensed. They also focus on the providers registered with their country's regulatory bodies.

4. Provide Regular Training

Ongoing training should be provided to the offshore team. It ensures that they remain up to date with US regulations. CPA and accounting firms should provide regular training on data security. This also helps with privacy and compliance with US regulations. Firms should also ensure that the offshore team is trained on the organization's procedures.

5. Non-Compliance: Planning

Non-compliance may occur when offshoring finance and accounting tasks. CPA & Accounting firms should have a plan to address non-compliance. It involves clear protocols for reporting and investigating potential breaches. The strategy for addressing any resulting reputational risks is also a part of it. Thus, it is essential for non-compliance with US regulations.

6. Verify Compliance with SOX and SEC Regulations 

Accounting firms are subject to additional regulations. These regulations require firms to maintain financial records. It also assures the effectiveness of internal controls. Firms should verify whether the offshore service provider complies or not. It involves assurances on internal controls, maintaining audit trails, etc. These ensure that financial records are accurate.

7. Establish Communication Channels 

Effective communication is essential when offshoring finance. CPA and accounting firms should establish clear communication channels. It can be done with the offshore service provider. It involves regular reporting and feedback mechanisms. Firms should also ensure their offshore team understands US regulations and AICPA guidelines.

Winding Up Note

Companies can unlock the potential of offshoring by following these steps. US experts generally believe that offshoring finance. They believe that it provides cost savings. It also allows access to skilled professionals. But, caution that it may also lead to security risks.

Fino Partners, with over years of experience in outsourced bookkeeping services, uses its proprietary framework called DPPT – Definition, Process, Precision & TAT, which has been the success mantra for supporting firms in the US to stay ahead of the competition. By partnering with an experienced offshore bookkeeping services provider like Fino Partners, CPA firms can access a team of professionals knowledgeable about the latest technologies, up to date with ever-evolving accounting norms, and domain experts in US accounting.