Currently, with the fast-paced lifestyle and business module, the trend in organizational culture has shifted to the use of technology with minimal staff. No one has enough time to look after the accounts and evaluate the business, since the main focus of the senior management is to expand and grow the business as well as the profit margin. Earlier, an accountant or an auditor would be appointed to evaluate the accounts. This led to several problems in continuity of the staff once trained; as after sufficient experience they would either demand a high salary or change the job thus resulting in an unnecessary waste of energy and resources of the management. To overcome these issues, Outsource Accounting Service came into picture.
What is Outsource Accounting Service?
Here, a specialist, Accounting Service Provider, provides accounting services to clients in which a highly trained and professional staff is sent to the client’s place for all their accounting needs on a periodic basis. The Accounting Service Provider firm takes the responsibility of proper accounting and book-keeping of the client and accordingly a minimal fee based on the service agreement is charged.
What are the benefits of Outsource Accounting Services?
Most people would say, why not hire a Chartered Accountant instead of paying an organization for the same. The benefits of appointing outsource accounting services are much more than appointing a staff member. Let’s list them down.
- The staff available here is well-trained reducing the time and resources spent by management in training.
- Fees are pre-determined based on the service agreement with an annual increment clause so there is no need for salary negotiations and increment review.
- Clients receive a professional accounting team for relevant advice on all the financial matters.
- Proper accounting is done which helps the auditors to conduct a smooth audit with minimal queries.
- Zero employee turnover ratio as the staff is managed by the firm and replacement is mandatory as per the agreement.
- Zero absentees as there are enough professional team members to take the place of someone who may be on leave.
- No Bonus or other perquisites or obligation to the client.
- Management can focus on the business as the responsibility of the accounts is now of the firm.
- Timely completion of work with less or zero re-do in accounts.
- Effective implementation of statutory and other Compliance.
- Proper documentation of all the invoices and vouchers in sequence.
- Timely payment of taxes and other expenses.
- Proper cash management and implementation.
What are the different modules in Outsource accounting?
Outsource accounting can be done in 3 ways.
- The client can send the bank details and other documentation or invoices electronically and the firm maintains these books in accounting software. This is beneficial to the clients who do not have the place and resources (Computer/ Software) to do accounting at their place. These modules are useful for those start-up businesses, who focus on the core business and do not want to spend time or resources an accounting team.
- Another way is that, clients can have the book keeping done on a weekly or monthly basis and the staff from the Accounting Service Provider firm will visit and get these recorded. These are beneficial for start-ups or those businesses which are in the early stage and cannot afford to appoint a full-time accountant. This type of service is useful for them as they can be flexible with the space and resources for accounts. No designated computer or Laptop and other resources to be given to the staff and they only need to make the resources available as per the visit of the staff.
- The third way is where full time accountant is placed at the organization but on a payroll of Accounting Service Provider. The training & monitoring of accountant is done by the Accounting Service Provider. Accountant works as part of the organization but is technically mentored by the Accounting Service Provider.
Who can use these Outsource accounting services effectively?
The said service can be used by anyone and everyone as it will ease off the pressure on the business. Below is the list of Clients from different segments who have adopted easily to Outsource Accounting Services.
- Newly formed Start-ups
- Multi-National Companies with only marketing office in India
- Professionals/Professional Firms
- Retail Vendors
- Small Scale Manufacturer
Thus, when it comes to managing one of the firm’s most critical resources – accounts; it is important to have the best team at your service. With Outsource Accounting Services, you can ensure all your finances are taken care in an optimum manner allowing you to scale and grow your business to new heights.
Via – Amey Anil Acharekar