In today’s dynamic and modern business culture, the concept of outsourcing various processes and services is one of the most strategic ways of growing a business. Organizations are outsourcing multiple services, or a whole department, in some cases, to save on the cost of hiring in-house employees. Accounting and bookkeeping services are some of the most outsourced services by organizations nowadays.
By outsourcing accounting services, businesses can reduce the cost of hiring a full-time in-house accountant, scale your business more efficiently, and incorporate versatility at work. A lot of business owners around the globe are already aware of the benefits of outsourcing, but some are still hesitant to adopt this practice, especially those who haven’t tried outsourcing before.
Outsourcing is never easy, especially for accounting outsourcing. Unlike other services, accounting outsourcing requires a certain skill set and work environment for it to work. What drives companies to outsource accounting? Here are some triggers that prompt small business owners into finding a new accounting solution:
- Employing more than 10 people
- Working with outside investor capital
- Reaching more revenues
- Busy CEO
- Accelerated growth of the business
- More complicated accounting needs aside from billing and collections
- Need for more sophisticated financial reports and analysis
Business expansion is a great achievement for any business owner, but it also comes with additional work and requirements. You have more revenues to count and plan for, more people to pay, more financial obligations to attend to, more investments to analyze, and more financial decisions to make. The quickest way to deal with these rising challenges is to outsource accounting or to hire an accounting VA. They get the work done in a short amount of time, without you spending a lot for training, employee benefits, and other expenses usually acquired when hiring an in-house staff.
But if you plan to outsource bookkeeping in the Philippines or you want to find accounting services in the Philippines, there are some things you need to consider before signing up.
Here are some factors you should look into before finding an accounting outsourcing partner in the Philippines:
1. Accounting tasks to outsource
The first thing you need to ask yourself is: Which accounting aspects do I need help with? Do you want someone to process your payroll or create financial reports for you? Do you need someone to handle your taxes and other financial obligations? Do you need someone to deal with your invoices and receivables? Or maybe you need to outsource your accounting tasks altogether?
Accounting is a very wide and complicated concept that involves multiple functions, so you need to be clear which services you want help with. Make a list of those services, as well as your requirements, to make sure that you don’t forget anything. Then, check with your accounting outsourcing partner whether they are able to provide the services that you need.
2. Skills that you need
Some accounting tasks require specific knowledge, experience, and skills. For example, you may need someone who is an expert with Xero or MYOB for your tasks. If you need your accountant to handle your taxes, an in-depth understanding of your country’s taxation laws and regulations is a critical requirement.
Along with the list of tasks you want to outsource, list down the scope and requirements of the tasks as well. You have to be clear about this before you start to make sure that your accounting outsourcing partner in the Philippines has the capability to tackle the job.
3. Check the pricing
One of the main reasons why companies outsource is to save on overhead expenses. Once you have a clear vision of which services you want to outsource and what you need from your outsourcing partner, the next factor you need to consider is the cost. Outsourcing to the Philippines can give will provide you significant savings without worrying about the quality of work. But this doesn’t mean that you need to go with the lowest bidder.
Accounting work requires accuracy and a lot of analysis since the accountant is dealing mostly with numbers. So if you want quality, you should be willing to pay for it. Remember that quality is usually directly related to the price. To avoid costly mistakes, choose an outsourcing provider that is able to deliver quality accounting services for a reasonable cost. The trick here is finding the balance between price and quality.
4. Data security
When you outsource your accounting, you’re sharing financial information with your outsourcing partner in the Philippines. This means they will be able to access your database, your accounts, your banking records, and other sensitive information about your business. If this information falls into the wrong hands or gets stolen, it could spell doom for your business. Hence, you need to make sure that the accounting outsourcing agency you’re working with will protect your data as much as you do.
To ensure data security, limit the other party’s access to your information on a per need basis. Don’t share everything. You should also ask your outsourcing partner what security measures are being implemented to protect your data. Do they use encryption technology or proxies? Who has access to your data and are they being password-protected? Don’t be afraid to ask these questions because it’s your data’s safety at stake.
5. Solid communication
The last factor you need to consider is communication between you and your accounting outsourcing partner. Will you communicate via phone or email? Who is your point of contact? How responsive are they to your questions or requests? The good thing about accounting outsourcing services in the Philippines is that Filipinos are great in English. They can speak fluently and understand English communication very well so you don’t have to worry about not being able to send your message across. Still, being clear with your instructions and requirements can help a lot in avoiding misunderstandings.
Accounting outsourcing does not only reduce business cost but also optimize your business operations and give you the flexibility to grow as much as you want. But before you jump into the outsourcing bandwagon, do your research first and consider the factors listed above when making your decision to avoid regrets and costly mistakes.