Outsourcing in COVID-19 Era – An Accountant’s Guide
The COVID-19 contagion has toppled our worlds not just personally but professionally as well. A lot of US accounting outsourcing firms are currently functioning as remote firms working virtually to steer their clients during this financial crisis due to the pandemic. The situation has led to accounting firms getting swamped with work that is difficult to manage in the current scenario.
Leaders of your own Accounting firms, you surely realize the heavy and varied workload you and your team are trying to overcome, ranging from year-end accounting, bookkeeping, financial reporting, taxes, and more. While you adjust to the new normal of working from your house and supervising your teams remotely, it is becoming clear that functions such as accounting and bookkeeping, payroll, AR and AP, etc., basically all those activities which are resource-intensive are striving and warrant a lot of your time, energies and money being invested therein trying to manage your staff effectively and yet things not delivering to satisfaction. Non-availability of your junior staff due to personal reasons arising out of Covid-19 situation too is a prick in the path to successful client delivery.
Hence the golden question – why not share your workload during this raging era?
As an expert Outsourced Accounting Service provider, we CharterCPA have the experience and proficiency to offer in-depth insights that will help you productively outsource your client’s accounting and book-keeping, payroll, and a lot of other functions that you serve your clients within a routine. This article will serve as an escort to assist you during this hour of disaster so that you can leverage the efficiency and skill from offshore accounting partners and make time to advise and help your existing and new clients.
We have chalked this article to cover some of the vital points that US Accounting firms would feel the need to be addressed in deciding upon an offshore partner.
1. Does the size of an Accounting firm have bearing on the decision to outsource?
Cost reduction and process efficiency are the primary advantages of Outsourcing. Both of these benefits will be important as a part of your business contingency plans during such times, no matter how large or small your firm is. Notwithstanding your firm’s size, you can opt for outsourcing. If you know there are certain activities that you cannot manage effectively, which is resulting in delays and inaccuracies, outsourcing them makes sense for all kinds of firms, regardless of size.
2. Activities to outsource?
It depends on your firm and its current efficacy levels in an onshore setting. You can either outsource the entire gamut of functions or certain specific tasks. If you think you are finding it difficult to manage your simple but voluminous tasks like banking, invoicing, bill booking, and tax return filing on time and precisely, you can outsource this task to an Outsourced Accounting Service provider. If tasks like processing information, payroll submissions, timesheet processing are eating into your man-hours, or Invoice/Bill management is taking a toll in absence of your local resources available, outsourcing these make a great business decision. Our last suggestion is – identify what to outsource keeping in mind the resource-intensive and challenging nature of the tasks.
3. Selecting the correct Outsourced Accounting Service partner
This is your most important question! The search for the apt Outsourcing partner might seem like a difficult task initially, but in fact, it is very simple. When you are searching for an outsourcing partner you need closely evaluate their experience and expertise in the domain. You must also assess their ability to scale based on the number of employees with core accounting/payroll/tax expertise. Another significant factor to consider is data security. You will be sharing sensitive financial information with your outsourcing partner. It therefore should be able to meet with the custom data protection and privacy norms and must maintain an excellent cybersecurity posture to ensure the safety of your information at all times.
4. The Engagement options
Your plan towards outsourcing will require a choice of the method through which you want to engage the services of the provider. More often than not, you will be presented with these three most popular options.
Models of Outsourcing?
Variable model: Here, you only pay for the number of hours the Outsourced Accounting service provider has worked on your tasks. The provider assigns a staff member who is your single point of contact and who liaises with the accountants assigned to your tasks. This model is best suited if your plan is to not sign up for a long-term commitment or when you simply want to run pilot projects to test the offshore waters. It’s also ideal for the smaller accountancy firms, that have seasonal work or when they want to grow by focussing on more client acquisition and business advisory.
Fixed model: Also known as the full-time employee (FTE) model, this is the model everyone thinks of whether they want to work with outsourced service providers in India. Here, you are assigned a dedicated team or an individual who only works on your projects. It’s like your extended accounting team that works offshore in India. Regular reporting helps you stay on top of your projects and become more actively involved in project delivery. If your firm has large volumes of work on a consistent basis, this is the best engagement model.
The Mix Model: At times, it may so happen that you cannot clearly define the volume of your work, whether the same would increase beyond the committed volumes. In such situation, the Mix model, as the name suggests is a combination of Fixed and Variable model, wherein you may commit an estimated fixed price for the full time dedicated employee you may need and if the work increases beyond the full-time employee hours, you pay as per the variable model i.e. only for the hours spent in excess.
There are two mainstays to your outsourcing strategy – the quality of the services you subscribe to and the engagement model. Outsourcing Providers like CharterCPA have reduced their rates as per outsourcing models to help accounting firms out with sharing their accounting work. Contact us or Book a Call with us to know more about CharterCPA’s special Covid-19 offers.
5. The Other Mainstays
Business Continuity plan:
You have to assure your Outsourced Accounting Service provider is completely aware of your cost pressures and operational bottlenecks in the existing times. When you pass the work offshore, you cannot afford any downtime in the operations of your service provider. So, when considering outsourcing during COVID-19, there are some questions you must ask your outsourced accounting service providers like:
– How do you ensure business continuity in Covid-19 times?
– In case of emergency, can you move operations to other designated sites so that project timelines are not impacted?
– Whether you have all the necessary resources – people, processes, and platforms that assure uninterrupted delivery irrespective of events?
– What is your track record? Do your clients improve profitability in the long run?
– Have your outsourcing services improved the productivity of an accounting firm?
– Consider asking Client testimonials.
It is necessary to aware that there are some poor service providers out there and you need to avoid them anyhow. It pays to be extremely sure of the offshore provider’s capabilities.
Continuous professional learning:
This is an absolutely critical aspect to be verified that the staff of your chosen offshore partner is made up of qualified accountants, either CAs, CPAs or ACCAs or accountants with any other equivalent qualifications and are familiar with prominent accounting software tools such as QuickBooks, NetSuite, Sage, Xero, etc. Accountants handling payroll may also be familiar with US Payroll management software tools. You should ask if the staff is trained regularly and their skills are updated in step with the latest developments in the fields of accounting, payroll, and tax.
A prominent Outsourced Accounting Service Provider i.e, CharterCPA is helping the US Accounting firms to increase proficiency by setting up a successful extended offshore team for them in India without having to invest in infrastructure or bicker about hiring or attrition of resources. We encourage leaders of US accounting firms to step up as consultants or advisors to their clients during such times and leave the non-core functions to our offshore teams for fraction of a price. We assure the same quality and delivery of work as onsite accountants and free up time for US CPA/Accounting firms owners to focus on increasing business opportunities with existing clients and acquire new clients. We provide by giving access to a pool of skilled and trained resources readily available to help.
This article allows you to identify challenges faced with outsourcing and find a solution to them. Further, a rock-hard, workable, and future focussed strategy pledges that you are able to meaningfully justify outsourced service providers and choose the partner who is best placed to deliver the benefits of outsourcing to your accountancy firm while you function as a remote firm locally during Covid-19.
It is also important to watch out for breakdowns in your current local accounting teams and make sure to protect the psychological health of your employees during this time and outsource wisely to share the workload by cost-effective means. We know that accountants are at the frontline of this financial crisis and outsourcing workload whenever possible would prevent possible burnouts.
Thanks & Regards,
Knowledge Base Team
Finance and Accounts Outsourcing Specialist