Accounting is an integral part of UK based accounting firms. In reality, it is one of the most crucial functions of any business. It is vital for businesses since it helps them to make informed financial decisions and helps them with their development. Many accounting organizations have an in-house team to look after their accounting chores. On the other hand, more and more companies these days are choosing accounting outsourcing for several reasons.
Nevertheless, there are many myths about the accounting outsourcing industry, and many of these myths are due to not having enough knowledge about the outsourcing industry. Hence, many UK firms are cynical about outsourcing their accounting tasks to outsourcing companies.
Because of having insufficient understanding of accounting outsourcing and providers, many company owners give a miss to selecting outsourcing services. The following are some of the major myths and misconceptions surrounding accounting outsourcing. We have tried to throw light on some of these myths:
- Sharing Data to an Outsourcing Firm is not Secure
One major myth that the accounting industry has in its mind is that their information will not be secure with an outsourcing company. Specialist outsourcing accounting providers have stringent measures in place to protect their client data. Any reputable outsourcing provider would not like to lose their client over security concerns. Therefore, proficient accounting outsourcing providers have security measures implemented to make sure that data of their clients is completely safe.
Before associating with an outsourcing firm, business owners should do their research on the security aspect. Many outsourcing providers follow the highest security standards. They also implement an NDA (Non-disclosure agreement) and invest in top-notch security equipment so that data is not exploited. By collaborating with such an outsourcing provider, data and information security should not be an issue.
- Losing Control over Business Financials
Understandably, it is an innate tendency for business owners to be concerned about losing their business financials and having no control over them. There is no dispute about the fact that there are benefits of accounting outsourcing. However, when an accounting corporation contemplates outsourcing its accounting functions to an outsourcing provider, it can be bogged down and feel cynical about losing control of their business.
The reason for the cynicism is that the accounting work will be done at a remote end. On the contrary, if a professional and quality accounting outsourcing provider is selected, it will not be a problem at all. Prior to choosing an outsourcing provider, company owners should do the reputation check of the outsourcing provider, find out about the mode of communication, reporting process, etc. This way, company owners will feel at ease. It is a misconception that a business will lose control over its financials. Teaming up with an accounting outsourcing provider of good standing will only be beneficial to the business.
- Accounting Outsourcing is Expensive
This is a common myth in the accounting industry. In contrast, the fact is that this is a false impression. Many firms are apprehensive about outsourcing, thinking that only large corporations can afford it. Like any other service, accounting outsourcing services are available at different costs. There are providers that have high charges, but there are also providers that have specific rates for smaller companies.
It may seem that having an in-house accounting team is cheaper compared to outsourcing. But, there are various costs that a firm needs to mull over. For example, salaries of employees, benefits, etc. When you compare the overall cost, opting for outsourced accounting services works out economical. Outsourcing companies have price and service structures for all statures of businesses.
- Accounting Software is Sufficient
Advancement in technology has changed the accounting industry. Various software is available these days to take care of bookkeeping and accounting functions. Different types of software are available in the market these days, and no doubt, this has made the tasks more manageable. However, nothing can beat human expertise.
By just having accounting software is not enough. Companies need to have experts who can maximize the potential of technological advancement. This is where accounting outsourcing plays a crucial role. Finances need to be taken care of and require more work. Outsourcing companies have a team of accounting experts who can handle all kinds of accounting tasks. They are adept at handling complex accounting functions. Hence, it will be beneficial for businesses to use the services of expert outsourced accountants.
- Outsourcing Denotes Offshore
This is also a prevalent myth surrounding accounting outsourcing services. Many companies believe that outsourcing drives jobs offshore. They are concerned that by outsourcing, the tasks will be handled overseas, and their workforce will become outdated. However, there is absolutely no truth in this. The staff may not be doing the task that is outsourced, but many other tasks need to be done in any organization.
On the contrary, by outsourcing routine and time-consuming tasks, companies will free up the time of their employees. The employees can be assigned to other vital jobs that generate more revenues for the business. The trivial tasks can be outsourced and instead, the staff can be used for revenue-generating tasks. Accounting outsourcing will help companies to upskill their existing employees. Also, companies will be in a better position to offer better opportunities to their employees.
The above are some of the most common myths and misconceptions related to accounting outsourcing. Due to these myths, many companies in the accounting industry are hesitant to go for outsourcing. We have debunked and busted some of these myths. Without beating around, there is no doubt that accounting outsourcing is very much beneficial for accounting firms. It helps to reduce costs, saves time, allows companies to focus on core business functions, and has a whole lot of other benefits. Outsourcing accounting services is still in its nascent stage. But, a lot of accounting firms are resorting to outsourcing in recent times to get the most out of outsourced accounting services.