What is Offshore Accounting A Beginner’s Guide and Its Benefits

What is Offshore Accounting

Offshore accounting is simple to understand. It is nothing but delegating or assigning certain portions of your accounting tasks to a third-party service provider. It is also a type of outsourced accounting practice in which you assign certain accounting tasks to an accounting service provider based in a faraway country.

UK accounting firms increasingly use offshoring accounting to address challenges like talent shortage, workload, and cost. Through it, you can delegate your complex and non-core activities such as:

• Tax Compliance
• Accounts Receivable and Payable
• Bookkeeping
• Payroll Management
• Inventory Management

Let’s get into the world of offshore accounting and understand why it’s not going away anytime soon.

Reasons Why You Should Choose Offshore Accounting Services

From bookkeeping to management accounts, offshore accounting will cover all aspects essential for running a UK accounting firm smoothly. Below, we elaborate on why you should choose offshore accounting services.

Cost of Offshore Accounting

By availing of offshore accounting services, you can reduce the need to hire a team of accountants, thus saving costs that would have come in the form of salary, benefits, and related infrastructure expenses. Furthermore, delegating tasks to an offshore accounting service provider eliminates the need for spending on recruitment and training. By offshoring some of your accounting duties to an accounting service provider, you can save on labour costs and other related expenses. This way, you can reinvest the money saved in business expansion and development and the improvement of services.

Handling of Peak Season Workload

You must have faced a situation where your accounting practice will face sudden demands for audits from your UK-based clients, especially at the end of the year. Such a sudden increase in workload will increase the chances of human errors or mistakes. By choosing to outsource via offshore accounting, you can save time by offshoring tasks that would have consumed a lot of time, such as bookkeeping, financial reporting, audits, tax calculation, and preparing trail balances, to name a few. By ensuring that you do not overburden your accountant, you can reduce the chances of errors.

Getting Access to a Pool of Experienced Talent

You may face difficulties hiring the right accounting talent to run your accounting practice smoothly for multiple reasons. Rather than stressing about finding the eligible recruit, you can focus on getting that talent through offshore accounting services. Through offshoring, you can access the professional and experienced accounting talent of third-party service providers located in foreign locations at a lower cost.

Focus on Important In-House Priorities

When your accounting practice grows, your in-house team will find it challenging to manage the increased workload. Waiting up to last minute will only increase the pressure on your in-house staff which will cost you the quality of services. Therefore, it’s wise to opt for offshoring accounting services which will relieve the burden on your in-house staff who can concentrate on business expansion. Thus, resulting in quality improvement and an increase in profits. Through offshoring, you save time for your in-house staff, which can be invested in developing or acquiring new skills.

Benefits of Offshore Accounting for Businesses

Apart from the above-mentioned reasons which can qualify as benefits, some other important benefits or advantages offered by offshoring accounting are important to mention. These benefits are:

Ensuring Full Compliance

Through offshoring accounting via experienced outsourced accounting service providers, you will not have to worry about missing tax deadlines. All this will be handled by your offshore accountant, who will be well-versed in UK tax laws and regulations stipulated by HM Revenue and Services.

Fewer Risks in Operational Management

Recruiting people into your organisation has its own challenges, such as the cost of salary, benefits, and related expenses, which must be borne. Furthermore, desktops, office infrastructure, accounting software, and fulfilling ISO (International Organization for Standardization) requirements for the workplace are a few things.

Also, plan for requirements accordingly because recruiting a talent in-house for work only for a short period might be difficult. That’s why by availing the services of an offshoring accounting firm, you will not have to shell out extra money on recruitment, training, and staff maintenance. The service provider will handle all your accounting tasks, thus enabling you to reduce the risk and improve your services.

Quality with Fewer Errors

The complex field of accounting can only be handled perfectly with accuracy, experience, and attention. Any mistakes in financial records will lead to hefty fines and loss of reputation for your accounting practice. Through offshoring accounting services, you will get access to skills and experienced talent who can deal with huge volumes of paper, bills, and books of accounts for your firm. Through this offshoring, you are saving time and getting documents done correctly and before the tax deadline.

Strict Data Security and Transparency

You may be heisting offshore accounting services because you fear your data will be exposed to third-party service providers, but that fear is completely unwarranted. Accounting outsourcing and offshoring service providers are bound to adhere to data security measures to protect sensitive information because their business depends on it.

Scalability

There will be periods when you may have little accounting work, such as payroll, quarterly financial reports, and so on. In that case, you cannot lay off your in-house staff because they are interested in a long-term association with your organisation. This is where offshoring accounting comes to your rescue.

Under it, you can offshore specific crucial tasks whose requirements go up and down. Through offshoring, your staff can receive essential support when the workload is high, and you can scale down the requirement when it reduces. Thus, reduces the requirement of hiring and laying off staff that adds to your financial burden.

The Best Advice for Organisations Considering Offshore Accounting Outsourcing

Multiple service providers are offering offshoring accounting services that cater to various sectors. They conduct accounting tasks such as generating financial reports, tax calculations, income tax filing, and accounting for accounts payable. But the question remains as to how you are going to select the best one that can meet your requirements. Well, we can guide you in this; you only have to follow the below points.

• Check the Cost Effectiveness of the Offshoring Team
• Get Hold of a Professional Team
• Check the Team Communication Skills
• Is Your Service Provider Reliable
• Check for Technology and Infrastructure Capabilities and Data Security Measures
• Also, Take Into Consideration The Time-Zone Difference While Selecting A Service Provider
• Are They Offering Customised Client Centric Services?

Offshore Accounting Service Types

Bookkeeping Services

Bookkeeping involves tracking, classifying, and organising your accounting practice’s daily financial activity. Of course, it involves a lot of work, and you cannot afford to devote all your resources or staff to it. You can focus on other important tasks by using the outsourcing bookkeeping services offered by offshoring bookkeeping service provider.

Financial Statement Preparations

If you are not able to devote time to preparing financial statements, you must delegate this responsibility to an offshoring service provider. Their accountants will ensure proper preparation of financial statements by providing them with all necessary information.

Tax Preparation

We understand that tax preparation is complex and time-consuming work. Still, one cannot ignore it since it involves calculating, preparing, and filing income tax returns at the end of the year. Tax preparation aids in balancing accounting books, preparing tax and financial reports, submitting a return, and much more.

Payroll Services

Rather than managing payroll through your in-house payroll team, which is a recurring and time-consuming process, why not outsourced payroll to an offshore accounting firm? Thanks to the accounting software used by offshore accountants, you can control salaries and benefits, save time, and reduce errors. These accountants also ensure your payroll complies with all tax rules and regulations.

Conclusion

After going through this blog, we are confident that all your doubts about offshoring accounting have been cleared. In this blog, we have made you aware of the benefits of offshore accounting, the questions you must ask when selecting an offshore service provider, and a brief about the types of offshore accounting services. We are sure this blog will help you make your life easy during your accounting practice.

Still, if you need any assistance in this regard, you can opt for offshore accounting services from countless accounting service providers, including the rising star Corient UK. We cater to UK-based accounting practices and are based in Coventry, United Kingdom. We have extensive experience offering various accounting services, from bookkeeping and payroll to auditing and VAT services. Our services have brought remarkable improvement in the output for multiple practices, and we can achieve the same success for you. Feel free to contact us using our website contact form and share your unique requirements. Our executive will get in touch with you as soon as possible.