13 Reasons Outsourcing Helps CPA Firms Gain a Competitive Edge?

Currently, accounting and CPA firms are heading towards outsourcing. There are many reasons for this, one of which is the issue of skilled staff shortage. With this, CPA firms are maintaining their quality and have a competitive edge. This blog is exclusively for you if you own a CPA firm and want to streamline your operations with outsourcing. But, as you are proceeding towards outsourcing for the first time, there might be many queries and confusion. The blog will provide you with a comprehensive understanding of outsourced accounting and bookkeeping services, including managing bookkeeping tasks and financial reporting, enabling you to make informed decisions and help your firm scale new heights. 

1. Fixed-Price Approach:

Cost reduction is one of the most widely regarded benefits of outsourcing accounting and bookkeeping. Also, the cost of outsourcing accounting is also likely to be 10 times lower than the expenses involved in managing the in-house team. Utilizing accounting software to manage costs effectively can further enhance these savings. 

Intriguing! Isn’t it?  

Actually, every expense is fixed in this which makes budgeting easier. Also, expenses spent in hiring process and training can also get saved with outsourced accounting services and outsourced bookkeeping services. You also do not need to pay other expenses like fixed wages, health insurance, provident funds, office space investment, accounting tools & software, etc.  

2. Quicker Turnaround Time:

Get Your Work Done While You Sleep! 
Sounds Interesting! But is it possible?

Yes! Outsourcing makes many things possible. How? Have a look here! 

It doesn't matter how much time you spend; what matters is how much time you invest!    

That means time and resources are both important, and one should make the most of them. CPA firms that outsource to overseas locations like India gain from the time difference. Do you know how? India is 10 hours ahead of the East Coast of the US. So, the work sent overnight can be completed the following day. So, you can get your tax preparation, bookkeeping, audit, and accounting done with a shorter response time. You sleep peacefully at night, and your work will be done.  

Also, in this scenario, the overlap between the two time zones of an accounting firm and the offshore accounting staff becomes crucial for effective collaboration and communication. The significant window for overlap between the two time zones allows for real-time communication and coordination between the accounting firm and offshore accountants.  

To ensure better communication during this, various tools and technologies should be included. Also, regular meetings and clear communication channels for seamless collaboration should be established. 

3. Better Operational Efficiency:

This is the most cited benefit of outsourced accounting and bookkeeping services after reduced operation costs. Small and medium-sized CPA firms need access to the latest technology and infrastructure to perform efficient accounting functions. Accurate financial statements are crucial for maintaining operational efficiency. However, they can match their big competitors' efficiency and productivity levels once they outsource specific tasks to a third party with ample experience.  

There are many ways in which CPA firms enhance their operational efficiency. Firstly, when they delegate their routine accounting tasks to a specialized offshore accounting partner, they can solely focus on the firm's core competencies. By offloading these tasks, firms can allocate their resources more effectively, leading to improved productivity and cost-effectiveness. 

Also, outsourced accounting services let firms scale their operations more flexibly as per workload or seasonal demand. Additionally, outsourcing mitigates risks related to turnover and staff shortages. Overall, outsourcing accounting offers CPA firms an opportunity to streamline operations, leverage specialized expertise, and adapt more effectively to changing market conditions.  

4. Find The Best Talents in the World:

Accounting outsourcing can help you gain access to articulated and professional accountants, auditors, and tax professionals from other parts of the world.  

This is the primary advantage of outsourcing Global talent with unique skills and expertise. They make your work easier and faster. CPAs and accounting firms handpick professionals with the exact qualifications and experience required for the job, which results in accurate and faster execution of their firm's accounting tasks.   

Additionally, using an online bookkeeping service, tax preparation, audit, and accounting can provide access to global talent, offering dedicated financial experts, automatic data gathering, tax support, and a team of professional bookkeepers. 

5. Channelize Resources on Core Strength:

The main aim of any CPA firm is to consistently offer delightful customer services to enhance customer loyalty and rapidly grow the customer base by onboarding new clients. By outsourcing certain tasks to offshore accountants, you will be free from the stress caused by the complexities of statutory compliance, accounting, and audit. Outsourcing allows the internal accounting department to focus on core strengths.  

CPA firms possess unique expertise in areas like tax advisory, audit, and financial consulting. However, some time-consuming tasks like data entry, transaction processing, or reconciliations drain valuable resources and time. When you outsource these tasks to a specialized outsourced partner, then the in-house team can put more effort into other areas. You can channel your in-house team to work in the direction of your core vision and mission. 

6. Better Risk Management: 

When you run a CPA firm, there are many risks associated with each function. Any misplaced records or errors can cause financial losses and loss of reputation. You may also face legal penalties because of these errors. Outsourcing accounting can mitigate these risks by providing cost efficiency, access to specialized expertise, time-saving, and flexibility to accommodate business growth. 

Another risk that CPA firms are vulnerable to is losing a seasoned professional. This can be a significant risk because your work will suffer till you hire a replacement. However, recruiting skilled experts is a time-consuming task.  

By using offshore accounting services, you will minimize all these risks because you will have a team that works with the utmost efficiency. Moreover, a replacement for any accounting expert leaving the firm will be available. So, work will not suffer.  

7. Enhanced Quality of Reporting:

Reporting is one vital task for the efficient management of accounts. Outsourced staffing partners who have been in the accounting industry for years offer transparent, insightful reporting. You will receive the most accurate, professional, and efficient reports from an accounting outsourcing partner through an in-depth quality check process. With outsourcing, accounting firms can gain access to their expertise and receive valuable financial advice and insights that help them make informed decisions and ensure sustainable growth. 

For better working of offshore and onshore teams together and to ensure the enhanced quality of reporting, implement the Buddy System. It is when you can match each person from the offshore team with one or two people from the onshore team. This can lead to a smooth working process. 

Working with both teams in overlapping hours and connecting with them via meetings and training sessions helps in better communication and building a strong professional relationship. 

 8. Data Security:

Management of accounts is a critical function because money and reputation are involved. Cases of internal data theft, financial fraud, and similar risks are not uncommon. And so, accounting firms have concerns regarding cybersecurity. When you choose a company for outsourced staffing, it will ensure that you not only have a trustworthy team but will also have strict policies to control such incidents.  

Ensure that the outsourcing company has certifications like SOC 2 Type II and compliances like GDPR for the accounting security of clients' data by demonstrating the company's commitment to robust internal controls and data protection practices. Also, the company must possess a few information security standards like ISO 27001:2013. 

The ever-changing landscape of financial regulations and compliance requirements is a key challenge for many firms. Outsourced accountants are typically well-versed in these areas and can provide valuable guidance and expertise skills. Their knowledge and experience in dealing with regulatory compliance, tax laws, and financial risk management can prevent costly errors and legal issues. This expertise is crucial in mitigating risks and protecting the potential of the firm.  

9. Seamless Tax Preparation:

Outsourcing can help you simplify the complexities associated with tax preparation and reduce the workload of your in-house team. These services often include tax preparation services as part of the suite of outsourced services. Instead of making last-minute efforts to organize your financial data, outsourced bookkeeping services can help you prepare for the upcoming tax season. When the tax season eventually begins, their expertise enables swift, faultless tax filing, allowing you to exploit all available opportunities for potential tax deductions.  

Moreover, when accounting experts handle financial records, no issues related to data accuracy and integrity will crop up. The offshore team will instill confidence in your financial data, whether it is presented to financial institutions, undergoes investor scrutiny, or fulfills reporting obligations to the IRS.  

10. Continuous Improvement and Learning:

Partnering with offshore accounting partners will expose your firm to the latest trends, best practices, and technological advancements. Continuous learning and improvement will spur innovation within your firm, leading to the development of new services and working models. Staying in touch with the latest trends in accounting and adopting them will help you drive long-term growth and sustainability, ensuring a steady enhancement in ROI.  

Just like Entigrity, which values continuous learning & development and even implemented initiatives to support this. The learning & development department of the company made it mandatory for team members to complete at least ten credits of L&D every month. Also, the company provides all staff members with access to continuous learning platforms such as MY-CPE, CCH, Checkpoint, Udemy, and Surgent Content. It has Basic, Intermediate, and Advanced levels of 100+ certificate courses. Also, the scholarship of CPA & EA to staff is provided for better learning. 

11. Access to Advanced Technologies:

With outsourced accounting services, firms can get access to advanced technologies and cutting-edge solutions tailored specifically for financial management and reporting. These technologies, from cloud-based accounting platforms to sophisticated data analytics, facilitate firms to efficient financial management, enhancing accuracy and speed. Also, these technologies come with robust security features, ensuring the confidentiality and integrity of sensitive financial data. 

Choosing an outsourced accounting partner for your CPA or accounting firm also keeps you abreast of industry trends and innovations.  These help firms drive operational excellence and remain competitive in a rapidly evolving landscape.  

12. Open Gates to New Possibilities:

Only 1% of U.S. Accounting firms can find staff. The US Accounting Industry is finding it challenging to find accountants. Working with an outsourced accounting firm can unlock new possibilities by providing efficiency and cost savings. With outsourced accounting staff, CPAs and accounting firms can manage this shortage and enhance the firm's efficiency. They can unlock opportunities for innovation, expansion, and diversification of services. Adding outsourcing professionals to your team increases efficiency, resulting in revenue for the firm. 

Outsourcing offers the option of scalability with a wide range of engagement models such as dedicated, ad-hoc, and block of hours. You can choose the fit that suits your needs based on work volumes. During the peak seasons, when you have too much work, you can scale up the offshore team, and when the work is slow, you can trim it down. Moreover, you won’t have to worry about backups to cover sickness, holidays, and maternity, along with the associated time and cost. 

13. Better Cash Flow Management:

A healthy management of cash flow in any firm is an indication of its seamless functioning. To take the necessary actions for the smooth running of the cash flow cycle, it is necessary to improve both accounts payable and accounts receivable. Outsourced accounting and bookkeeping services will ensure on-time and accurate bookkeeping, reporting, and forecasting to help businesses enhance cash flow and exploit the benefits, including high profits. 

Conclusion

By opting for outsourcing your firm’s back office to a trusted accounting provider, you will pave the way for your firm’s expansion. You will get accurate financial insights to make wise decisions, generate optimum profits, and ensure seamless scalability in sync with your path of growth.  

In conclusion, outsourcing accounting offers a myriad of benefits for CPA firms seeking to boost efficiency, streamline operations, and enhance client service. From cost savings to improved turnaround times, the advantages are undeniable. By adopting a fixed-price approach, firms can achieve budget predictability and eliminate the burden of hiring and training expenses. The ability to leverage time zone differences ensures tasks are completed swiftly, allowing firms to focus on core competencies and strategic growth initiatives. 

With a reliable offshore partner like Entigrity, firms can tap into specialized expertise and advanced technologies, ensuring data security, regulatory compliance, and operational excellence. Entigrity's ISO certification, SOC 2 Type 2 compliance, and GDPR adherence underscore its commitment to maintaining the highest standards of service and security. 

In today's competitive landscape, partnering with a trusted offshore provider like Entigrity is not just a strategic decision; it's a catalyst for transformation. With Entigrity's proven track record and dedication to excellence, CPA firms can elevate their performance, exceed client expectations, and thrive in an ever-evolving marketplace. Embrace outsourcing with Entigrity and unlock the full potential of your firm. 

FAQs 

Q: How can CPA firms benefit from outsourced accounting? 

Ans: By leveraging specialized expertise and reducing workload, firms can streamline operations and focus on core functions. 

Q: Can outsourcing accounting services improve accuracy and compliance? 

Ans: Yes, outsourcing to experienced professionals ensures adherence to regulatory standards and reduces the risk of errors. 

Q: Is outsourcing accounting suitable for all CPA firms? 

Ans: It depends on the firm's needs and capacity. Outsourcing can benefit firms of all sizes, but it's essential to assess individual requirements. 

Entigrity™ is a reliable offshore staffing partner for 850+ accounting and CPA firms, 200+ CFOs & businesses across the US, Canada, and the UK. With a flexible and transparent model, the company enables firms of all sizes to acquire skilled accounting, bookkeeping, and tax preparation staff. As a pioneer in offshore accounting, Entigrity ensures precise alignment with the hiring needs of accounting firms, providing staff under your control and management and minimizing concerns about compliance, payroll taxes, overheads, or benefits. Trusted by 40+ of the top 200 US accounting firms, we specialize in supplying highly skilled personnel from India. We have 39 global offices across India. We are GDPR compliant, ISO 27001:2013, and SOC 2 Type II certified. We are now "Great Place to Work Certified™," "KPO Organization of the Year," and "Dream Companies to Work For" among accounting industries. Entigrity is also recognized as a platinum partner by the Institute of Management Accountants (IMA). The company is strategically partnered with Boomer, a BDO Alliance USA and Abacus Alliance member. 

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.