14 Outsourced Specialized Services for Accounting Firm's Growth

In the ever-evolving landscape of the Accounting world, change is a constant force, and the accounting industry is no exception. Once perceived as a quick solution for handling overflow tasks or a short-term fix, offshoring is undergoing a profound transformation. Accounting firms worldwide are awakening to the strategic potential of offshoring and its great impact on various business functions.

The Traditional Offshoring Landscape

Historically, the accounting industry pursued offshoring to address specific firm needs. Firms primarily regarded it as a temporary or tactical solution for managing overflow tasks and reducing costs. Offshore accounting services usually include repetitive tasks such as tax preparation, accounting bookkeeping, data entry, and other less complex back-office functions.
The main driving force behind this initial wave of offshoring was cost reduction. Offshoring enabled accounting firms to access a more cost-effective labor force in offshore locations. By moving certain tasks to countries with lower labor costs, firms could stay profitable while managing their workflow more efficiently.

The Paradigm Shift

Today, offshoring has transitioned from a temporary strategy to an integral part of daily operations for many firms. Major accounting firms, including the well-known Big Four, plan to offshore 25% of their billable time within the next four to five years. They are keenly eyeing India as their preferred offshoring destination in this pursuit.
However, the offshoring blueprint now extends beyond traditional tasks. Firms are now looking beyond the conventional and venturing into diverse areas. They are harnessing the vast talent pool available in offshored locations and embracing the transformation.

The Expansion into New Outsource Specialized Services Territories

The spectrum of Outsource Specialized Services that accounting firms are offshoring has expanded. Let's explore this diverse array of services:

• SoC Examination and Audit: With an increasing emphasis on compliance, there is a high demand for System and Organization Controls (SoC) examinations.

• Technology and Automation Services: As accounting firms increasingly embrace digital transformation, the need for tech solutions has grown significantly.

• Cybersecurity consulting services (for accounting firms), Risk, and Compliance: In the face of looming cyber threats, security, and risk management have become paramount for firms.

• Internal Audit Services and Modular Acquisition Advisory: Offshoring these functions is helping bring efficiency to internal operations and merger and acquisition processes.

• Tax Planning and Representation Services: Accounting firms are moving beyond mere tax preparation to offer strategic tax management services.

• HR and Benefits Planning: Offshoring is streamlining human resources and benefits management for firms, improving efficiency in these areas.

• FP&A, Investment Banking Valuation: Firms are providing comprehensive financial planning and advisory services to businesses, aiding in strategic decision-making.

• Business Valuation and financial planning advisory services: Firms are also offshoring these services, which are crucial for mergers and acquisitions (M&A) and strategic decision-making..

• EBP Audit: Ensuring the proper management of employee benefit plans is another function being successfully offshored.

• Outsourced CFO services and Client Accounting and Advisory Services: Offering CFO-level insights and advisory services to businesses.

• Private Client Services: Delivering personalized financial planning and advisory services for individual clients.

• State and Local Tax Planning Services: Tailoring services to specific tax jurisdictions to meet diverse needs.

• Fraud and Forensics Advisory: Offshoring these services helps mitigate risks and investigate financial anomalies.

• IFRS Managed IT: Ensuring compliance with international financial reporting standards through expert IT management.

Moreover, accounting firms are expanding by utilizing Offshore Specialized Services and recruiting non-traditional roles, such as virtual assistants, customer support executives, administrative professionals, and business development associates, often from places like the Philippines.

The Takeaway

In conclusion, accounting firms are not just testing the waters of offshoring; they are pushing the boundaries of what strategic Offshore Accounting Services can achieve.
As the list of specialized services offered through offshoring continues to expand, it's clear that the accounting industry is only starting to see the full potential of this change.

Frequently Asked Questions

Let's address some common questions that often arise in the context of offshoring for accounting firms:
1. What are some risks in outsourcing specialized services, and how can you mitigate them?
Outsourcing accounting services carries several risks, including quality issues, data breaches, and service delivery interruptions. You can effectively mitigate these risks by establishing clear outsourced specialized services level agreements, implementing stringent data security measures, and implementing proper contingency plans.
2. How does offshoring differ from outsourcing, and what are the implications for CPA, CA & ACCA firms?
While outsourcing involves contracting work to external entities, offshoring goes a step further by relocating entire firm processes to another country. The implications for CPA, CA, and ACCA firms include gaining access to a global talent pool, achieving cost savings, and enabling 24/7 operations. However, offshoring also introduces challenges related to cultural and communication nuances, as well as potential political risks.
3. What are some of the indicators that a CPA, CA & ACCA firm might need to consider outsourcing or offshoring?
Signs that a CPA, CA, or ACCA firm might need to explore outsourcing or offshoring accounting include not being able to manage the workload effectively, a lack of specific expertise within the firm, high overhead costs, and the need for expansion. These indicators signal that it might be time to consider the strategic benefits of offshoring.

Entigrity™ is a trusted offshore staffing partner to 725+ accountants, CPAs, and tax firms across the US and Canada. Our flexible and transparent hiring model helps firms of all sizes to hire staff for accounting, bookkeeping, tax preparation, or any other task for 75% less cost. As a firm 'run by accountants, for the accountants,' Entigrity captures the hiring needs of accounting firms most precisely, providing staff that works directly under your control and management; still, you are left with the least to worry about compliance, payroll taxes, overheads or any other benefits.

Mukund Bhalala

Offshore Success Advisor

Mukund, Offshore Success Advisor at Entigrity, is a seasoned expert with over six years of experience in revolutionizing accounting firms across North America through innovative offshore staffing solutions. With a passion for customer relationship management and a keen eye for management accounting, Mukund spearheads large-scale projects, nurturing partnerships with leading firms. His extensive journey traversing 36 states and 210 cities in the USA enriched his understanding of diverse customer needs, fueling his commitment to delivering tailored offshore solutions. Mukund's mission is to empower teams, integrate cutting-edge technology, and drive growth in the accounting industry through strategic offshore staffing innovations.