Outsourcing means execution of customer’s instructions given to third parties on performance of certain tasks (functions) or business processes. There are various areas and functions, which the companies may provide for outsourcing, but currently the most common is outsourcing of tax and financial accounting.
The emergence of outsourcing is related with companies’ desire to optimize their resources and business processes. Attracting audit firms for outsourcing allows the companies to concentrate on core work priorities and to transfer the whole accounting or its any segment to an audit firm.
Companies' use of accounting outsourcing has several advantages:
As previously mentioned, outsourcing of financial accounting allows company’s management to concentrate on core priorities independently and to adjust the use of company’s resources expenses.
In addition to these advantages, outsourcing is also beneficial in case of seasonal and market volumes changes of the main company’s activity. In such cases, there is no need to involve emergency procedure of employment and dismissal of additional staff.
Accounting outsourcing allows to avoid problems of recruiting and personnel skills improvement. Thus, solving the problem of ongoing maintenance of accounting ongoing concern is solved due to absence of need to replace the accountant within during vacations or due to other reasons.
But the main value of outsourcing is an opportunity to use experience and professionalism of the audit firm. Facing any problem, the companies often have to spend additional considerable resources for its solution. At that, the audit firm specializing in the field of financial accounting report, as a rule already has a ready-made solution.
In addition, another priceless advantage of accounting transfer to audit firm is as well transfer of risks and responsibility for accounting maintenance, ability to compensate any losses incurred in case of errors.
Therefore, despite the desire of many companies not to leak any information, fear of innovations and simply ignorance of work specifics through outsourcing, there are still more benefits of accounting outsourcing.
Practice shows that use of accounting outsourcing and attraction of an audit firm with good reputation and huge experience brings greater impact and benefit to the company than independent accounting maintenance.
Stepan Shef, Deputy Director General HLB Ukraine