Accounting Outsourcing: Delegating the Flow of Finances to Professionals in a Cost-Efficient Way
The simple meaning of outsourcing is focusing on the key functions of the business model and allow external parties to manage other business functions in the organization.
As an example, it can consider an Advertising Company, its main or the key business areas are linked with advertising functions. Lead generation, Customer handling, Media projects, etc. But Accounting Department, Maintenance, and other Utilities are not directly related to its key functions. So organizations tend to outsource or let third parties to handle those functions and focus on what they are best at – key business functions.
Most of the Silicon Valley businesses are now focusing on Business Process Outsourcing (BPO) concept as it contributes value to the business in many ways and business owners can focus on the core or the most critical business functions of the organization. So, outsourcing insignificant business functions add value to the business in many ways.
- Owners will be able to focus on their key business functions
- Cost reductions
- Third parties handle outsourced functions more efficiently
- Smooth flow of business processes
- Add value to the business in terms of costs, coordination, economies of scale, etc.
Outsourcing Accounting Functions
In many organizations, the Accounting and Finance division is not the core of the most critical business function of the organization. So, there is a tendency of outsourcing Accounting and Finance functions to third parties. But it is very important that the Accounting and Finance division possess or generate sensitive information about the organization. So, outsourcing should be dealt with more careful manner. Otherwise organizational sensitive data will be lost and competitors will take advantage of organization sensitive information.
Accounting Outsourcing: Facts to consider when outsourcing
So a few key things to highlight when it considers selecting a third party for outsourcing.
- Data Security
- Reliability and Trustworthiness
- Past records of works (successful assignments, existing clients)
- Function coordination
- Effective communication
- Value addition