Top 5 Benefits of Outsourcing Accounting Services for Canadian Firms

Any firm hoping to expand and prosper must remain ahead of the curve in the fast-paced business world. Effectively handling the financial part of the firm is essential to its expansion. Outsourcing accounting and bookkeeping services has become a viable and smart way for many Canadian firms to manage these financial obligations. But why is outsourcing so advantageous for firms? 

The benefits of outsourcing accounting services are vast for Canadian firms, allowing them to streamline processes, cut expenses, and focus on core firm activities. With the help of polls and analysis from the accounting community, we will examine the top five benefits of outsourced accounting in this blog.  

What is Outsourced Accounting? 

Outsourced accounting refers to the practice of hiring an external professional to handle a firm’s accounting tasks, rather than managing those tasks in-house. This can include a wide range of financial and accounting tasks, such as bookkeeping, payroll, account reconciliation, budgeting, debt management, and financial analysis. 

Definition of Outsourced Accounting 

Outsourced accounting is a cost-effective way for firms to access expertise and reduce overhead costs. It allows firms to redirect their time and energy towards core firm activities while leaving financial tasks to trained professionals. By leveraging outsourced accounting, firms can benefit from a team of skilled professionals who bring diverse expertise, helping them make informed decisions based on accurate financial data. 

Types of Financial and Accounting Tasks That Can Be Outsourced 

Some common types of financial and accounting tasks that can be outsourced include: 

• Bookkeeping and Accounting Services: Keeping accurate records of financial transactions. 
• Payroll Processing and Management: Ensuring employees are paid accurately and on time. 
• Account Reconciliation and Financial Statement Preparation: Balancing accounts and preparing essential financial documents. 
• Budgeting and Financial Planning: Creating financial plans to guide firm decisions. 
• Debt Management and Cash Flow Management: Managing liabilities and ensuring healthy cash flow. 
• Financial Analysis and Reporting: Analyzing financial data to provide insights and reports. 
• Tax Preparation and Planning: Ensuring compliance with tax laws and optimizing tax liabilities. 

By outsourcing these tasks, firms can focus on their core activities while ensuring their financial management is in expert hands. 

Here are the top 5 benefits of Outsourced Accounting! 

1. Cost Savings and Resource Efficiency 

The substantial cost savings are one of the main reasons firms outsource the accounting function. The costs of hiring an in-house accounting team are high and include office space, training, benefits, and salary. These expenses can mount up fast for Canadian small and midsized firms. Firms can lower their operating expenses and yet have access to highly qualified accounting specialists by outsourcing. 

Survey Insight: The survey conducted by Deloitte shed light on the significant reasons firms outsource their accounting and financial functions. It reveals that 83% identified cost reduction as a main objective of outsourcing in 2021. This demonstrates how outsourcing allows firms to manage their financial tasks without the burden of high overhead costs. 

Key Benefits: 

• Reduced Payroll Costs: Full-time salary, benefits, and other overhead are not required when outsourcing is done. 
• Access to Expertise: You can hire highly skilled accountants without laborious hiring and training. 
• Scalability: Depending on the needs of your firm, you may scale up or down with the flexibility that comes with using outsourced accounting services. 

Canadian firms can better use their financial resources to expand their businesses rather than staff management by outsourcing their accounting needs.   

2. Access to Top Accounting Talent 

One notable benefit of outsourcing accounting services is having access to a large pool of highly skilled personnel through an outsourced accounting team. It can be difficult to find and hire highly trained accountants, particularly in Canada, where the job market is competitive. Firms can access a worldwide network of professionals with specialized knowledge in a range of accounting fields by collaborating with an outsourced accounting provider such as Entigrity.  

Survey Insight: A recent survey by Avalara reveals that 84% of CFOs are finding it tough to face a significant talent shortage within their accounting and finance teams.   

Key Benefits: 

• Specialized Expertise: The hunt for professionals with extensive knowledge of tax law, compliance, bookkeeping, payroll, and other critical accounting areas can be completed after partnering with outsourcing companies. 
• Global Talent Pool: Skilled accountants from all over the world are at your disposal, guaranteeing that your firm gains access to the most recent industry expertise. 
• Continuous Learning: To keep your firm compliant with local legislation, outsourced personnel stay current on best practices and regulatory changes. 

By outsourcing, Canadian firms can have their accounting tasks handled by experts who are equipped with the latest knowledge and experience. 

3. Increased Focus on Core Firm Activities 

Running a firm demands a proper focus. However, managing day-to-day accounting responsibilities can often distract a firm owner from other critical areas of your firm, such as strategy, marketing, and customer relations. By letting professionals manage the financial intricacies, Canadian firms may return their attention to their core firm activities through the outsourcing of accounting services. 

Key Benefits: 

• Improved Productivity: By outsourcing non-core activities like bookkeeping and payroll, your internal team can concentrate on areas that directly impact firm growth. 
• Strategic Focus: Firm owners and managers have more time to dedicate to strategic tasks that advance the firm's goals. 
• Streamlined Operations: You can have a more organized workflow and less internal complexity when accounting operations are managed outside. 

Firms that outsource accounting services report improved overall performance because their teams are no longer bogged down by the time-consuming details of financial management.   

4. Enhanced Accuracy and Compliance 

It is really a daunting task for Canadian firms to stay compliant with tax laws and accounting regulations, as well as with frequent changes to tax legislation. Outsourcing accounting services to a professional firm ensures that your financial records are accurate, up-to-date, and fully compliant with local and international standards.   

Key Benefits: 

• Regulatory Compliance: One of the major benefits of outsourcing bookkeeping and accounting is that the team always stays updated with ever-changing tax laws and compliance requirements. 
• Error Reduction: With experienced outsourced staff in your team, your financial records stay accurate with the possibility of fewer errors.   
• Audit-Ready: Outsourcing ensures that your accounting practices are always audit-ready, reducing stress during tax season. 

This helps Canadian firms avoid costly fines and penalties while maintaining confidence in their financial reporting. 

5. Technology and Automation 

The rise of technology in accounting has changed the way firms manage their accounting and financial aspects. Some of the tools that have become highly crucial in the modern financial landscape include accounting automation, cloud-based software, and data analytics. Partnering with an outsourced accounting company like Entigrity makes sure to leverage the latest technologies and that too without asking you to invest in costly software and training.   

Survey Insight: A study by EY presented data on a 78% shift to Gen AI integration of accounting firms. Outsourced accounting providers have already adopted these technologies, giving firms access to cutting-edge solutions.   

Key Benefits: 

• Access to Advanced Software: Outsourced accounting companies keep access to the latest accounting software so that your firm's financial data is processed accurately and efficiently. 
• Automation: Automating repetitive tasks such as payroll and invoicing helps reduce errors and further save time.   
• Data Security: Outsourced firms have robust security protocols to protect your financial data from cyber threats. 

By outsourcing accounting services, Canadian firms benefit from the latest accounting technologies, which can enhance efficiency and improve decision-making. 

Final Thoughts 

The benefits of outsourcing accounting services for Canadian firms are clear. And what’s that? Cost savings, access to top talent, improved focus on core firm activities, enhanced accuracy and compliance, and access to the latest technologies. Doesn't matter if you are a small or mid-sized firm looking to streamline operations or looking for advanced financial management; outsourcing is the perfect way for you to get started, as it provides the flexibility and expertise you need to succeed.   

At Entigrity, we specialize in providing tailored offshore accounting services to Canadian firms. Our team of highly skilled professionals is ready to help your firm manage its accounting tasks efficiently, allowing you to focus on what matters most: growing your firm.   

FAQs 

1. What are the benefits of outsourcing accounting services? 

Ans: There are many benefits of outsourced accounting. Partnering with the right outsourcing company helps your firm reduce costs, access skilled talent, focus on core activities, ensure compliance, and leverage the latest accounting technologies.   

2. How does outsourcing improve accuracy in accounting? 

Ans: Outsourced accounting companies hire experienced professionals with great knowledge and expertise in tax laws and compliance. This further reduces the risk of errors and ensures that your financial records are always accurate.   

3. Is it safe to outsource accounting services? 

Ans: Yes, reputable outsourcing firms like Entigrity adhere to strict data security protocols and are compliant with regulations such as GDPR and ISO, ensuring your financial data is safe and secure. 

About Entigrity   

Entigrity™ is a reliable offshore staffing partner for 850+ accounting and CPA firms, 200+ CFOs & businesses across the US, Canada, and the UK, positioning itself among the top outsourced accounting firms. 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.