You may have noticed that the accounting industry in the UK is going through transformational changes. The factors that are causing these changes range from advent of new technologies to regulatory changes. To be one step ahead you will have to take these transformations into consideration. One way to deal with it is by having an in-house accounting team that is up-to-date with the latest trends in the industry. But let’s admit, this solution is neither inexpensive and diverts your attention away from your core business activity.
But there is another way that is gaining popularity and looking at what the accounting industry is going through it is here to stay for a long time, we are talking about Outsourcing. It is increasingly gaining popularity among the UK accountants because it offers long term direct and indirect benefits that can increase the efficiency and productivity of your accounting firm.
Let’s dive into it.
Direct Benefits of Outsourcing
Hiring, and training an in-house team can strain your financial resources and if you are a small sized accounting firm then building a team is out of question. Even if you think of hiring part-time personals who are less expensive, they will be lacking in the expertise, which can lead to other complications. You can save cost by choosing to outsource the accounting processes. Through it you will not require to hire new personals thus saving on wages, benefits, infrastructure, and other related expenses.
Access to Expertise
When you outsource to an accounting outsourcing service provider you are gaining access to their professional accountants. These accountants have deep and reliable knowledge about tax laws and regulations, and the latest trends in the accounting industry. Using their expertise, you can avoid non-compliance of latest laws and regulations, increase the efficiency and reliability of your services which in turn leads to increase in your firm’s business and reputation.
No Need to Train Resources
Accounting industry in the UK is currently being affected by the introduction of new legalizations and technologies and for that your team members need to be trained and updated at regular intervals. But it will cost you time and money and even with training your team will be lacking the expertise possessed by a professional accountant of an outsourcing provider.
An accounting outsourcing firm will make a point to keep a tab on the ever-changing legal landscape and they are capable to handle complex legal responsibilities which might not be possible for you. They will ensure you comply with the tax laws and regulations thus saving you from legal complications and penalties from the HM Revenue and Customs.
Using the expertise of service provider accountants, you can minimize on costly errors which may occur from an inexperience staff. These accountants have access to the latest technology and accounting software that eliminate the risk of making human errors.
Indirect Benefits of Outsourcing
Quick Turnaround Time
While doing in-house accounting with a less experienced staff you may have noticed that your accounting work may have slowed. The reason for it is many such as not using advance technologies and software. Advance technologies like Artificial Intelligence, Automation, and Cloud Computing are being used by outsourcing service providers extensively. These technologies aid in streamlining operations, reducing manual errors, and improving efficiency.
These tools can take over the repetitive accounting task so that your accounting firm can focus on making strategic decisions and client advisory roles, thus adding more value to your services.
Improved Accuracy Score
You cannot afford to be an expert in every aspect of accountancy that’s why you hire and build an in-house team to look after it. But your in-house team may lack the experience of the field and by the time they gain it they might have committed errors which can lead to legal issues, penalties, and loss of reputation. To avoid such scenarios, you outsource your accounting to an accounting service provider.
An outsourced accounting service provider, employs a team of expert accounting professionals who are aided by accounting software and advance technologies. Through it, human errors are reduced leading to improved accuracy and reliability in your services. Such reliability in your services will automatically increase your client’s confidence in your firm.
Improved Working Papers
The financial year-end is a stressful period and you would be surrounded by financial papers for the purpose of tax filing. In such a scenario, if do not have a system to properly organize these papers then you and your team will be in stress. You would like to avoid such a scenario, especially during audits or tax filing by outsourcing. An accounting outsourcing service provider will prepare and keep your financial papers in an organized way, so that you do not panic during audits.
When your firm expands everything grows with it, even the team size in every department including accounting numbers. The numbers with which you will be dealing will reach a level that you will not be able to handle it. To take care of it you will have to hire more employees or pay more to your existing employees.
But there is an option of outsourcing accounting to a service provider. They are flexible enough to scale up their services according to your business requirements and vice versa.
As an accounting firm you must be having the ambition of expanding into a range of services which you would like to offer to your clients. But realistically speaking, it is not possible for you due to staff limitations and the requirement of high investment for infrastructure and technology. But not to get disappointed because you can achieve it not directly but indirectly by choosing an accounting outsourcing partner.
Through your outsourcing partner, you can offer your clients an expanded range of services like real-time bookkeeping, year-end accounting, payroll outsourcing, corporate tax outsourcing and management reporting, to name a few. This way you can increase your capability to offer services to your clients and retain them.
You must imagine the financial strain under which you may come if you decide to go without an outsourcing partner. Firstly, you will have to bear the direct expenses of recruiting, and training a new recruit then wages and benefits have to be given. Apart from that there are several indirect expenses that come with it such as desk space, parking, canteen facilities, and so on.
But if you choose an outsourcing partner, you will be saving a whole lot of money which can be diverted towards growth initiatives and business expansion, not to mention the benefits of expertise and quality services you gain from.
In conclusion, we can say that outsourcing has become an important part of an UK based accountants, because it offers a range of direct and indirect benefits. It not only improves the quality of services, enhances efficiency but also drives growth. By giving non-core and repetitive accounting task to your outsourcing partner, you can focus on your core business and work on offering value added services to your client.