A growing number of US-based Certified Public Accountants (CPAs) and accounting firms are benefiting financially and operationally from accountant outsourcing.
The AICPA’s MAP survey suggests this trend is rising, driven by easy access to highly trained teams that complement in-house teams.
Cost reduction isn’t the only driver. Working across time zones to meet deadlines is another key advantage. Keep reading to learn more about accounting outsourcing for CPAs.
What is Accounting Outsourcing?
Accountant outsourcing involves a CPA or accounting firm collaborating with a certified provider for all or part of their bookkeeping and accounts work. Outsourced accounting providers can be based onshore in the USA or offshore.
Services often include bookkeeping, accounting and compliance work, accounts payable/receivable, tax preparation and financial reporting and analysis.
They also provide strategic planning, advisory services, and consultancy.
Some accountant outsourcing providers offer a much wider range of services. This includes IT support, recruitment, graphic design, virtual assistance, and other back-office services.
The current Outsourcing trend among US CPAs
The American Institute of Certified Public Accountants’ (AICPA) National Management of an Accounting Practice (MAP) survey revealed a growing trend among CPAs.
– 30% of firms outsource accounting work domestically.
– 25% use offshore outsourcing providers.
– 14% intend to outsource onshore in the future.
– 12% plan to start offshoring.
The main drivers among CPAs/accounting firms in the USA are efficiency, cost savings, access to international expertise, and working across time zones for increased productivity and scalability. It also helps reduce turnaround time.
How USA CPAs benefit from Accountant Outsourcing?
Efficiency and Accuracy
Outsourcing provides technical skill, complete integration, real-time access, and enhanced efficiency. Working outside normal office hours and across time zones, teams focus on assigned tasks.
These teams’ technical skills and process efficiency deliver routine bookkeeping or accounting tasks accurately and on time.
Cost saving and Scalability
By outsourcing certain routine business operations, many CPAs and accounting firms value the ability to scale up or down and reduce costs.
Hiring in-house to manage the routine tasks of bookkeeping and accounting is no longer as cost-effective as outsourcing to well-trained, dedicated teams.
Human resources and Technical innovation
Outsourcing providers are known for their investments in training, technical advancement, and software integration. Cloud computing, AI, and blockchain (automation tools) bring enhanced accuracy, improved collaboration, and streamlined efficiency.
Training, Expertise and Global industry knowledge
Professional training, up-to-date industry practices, and access to a global talent pool attract accounting firms and CPAs to outsourced accounting providers.
Specialisms, expertise, and experience in international accounting standards, global business law, and regulations are other reasons CPAs outsource.
Security and Compliance
Numerous challenges come with working in a global economy. Compliance with both national and international accounting regulations calls for continual investment in professional training.
Owning the most up-to-date expertise in business law and regulations (e.g., Australia, the EU, and the US) ensures compliance wherever a business operates.
Operational Flexibility
Managing clients’ expectations and needs are two of the greatest challenges in modern-day accounting and CPA firms.
Outsourcing can improve customer relations and both data security and compliance. Dedicated outsource teams can manage operational areas while CPAs focus on their core business.
Better planning
Cloud-based accounting outsourcing services provide USA-based CPA firms with instant access to their financial information, facilitating decision-making, strategic planning, and growth.
Business growth
For accountants and CPAs, outsourcing means they don’t have to recruit, hire, train, and have so many in-house staff on the payroll.
Scaling up at peak times and scaling down at quieter times allows them to redirect resources to other areas of their business.
Working with colleagues in certain fields of global compliance allows CPAs to attract new clients and improve the variety of services on offer to their existing clients.
Accountant Outsourcing for CPAs: The need-to-know checklist
The decision to outsource financial accounting services is an operational change requiring careful planning. Safeguarding client data and maintaining compliance are top priorities.
Minimum unrest in-house and zero disruption to workflow are critical. CPAs must trust that work will be carried out on time, securely, and to the highest regulatory standards.
Some pointers to outsourcing financial accounting services successfully
Accountant Outsourcing: Due Diligence
Thorough due diligence is essential. Seek references, check out reviews, and carefully examine licenses and certifications.
Communication, Terms of Engagement
The success of the relationship relies on clarity. The CPA/accounting firm must be explicit about their objectives. The outsourcing provider must be crystal clear about what they can provide.
Fees and Fee Schedule
Agree on fees per project or part thereof and the payment schedule. This step depends on the objectives having been defined and agreed upon beforehand.
Once the services, scale, and deadlines are agreed upon, the fees and schedule can be confirmed.
Roles, Responsibilities and Schedules
Project managers on both sides of the relationship should communicate on roles, responsibilities, and objectives.
Their jobs will involve managing and meeting expectations as well as overseeing productivity, quality control, and schedules.
Communication and Digital Infrastructure
Agreement on the means of communication, software, hardware, analogue data sharing, and training should form part of the contract of engagement.
Setting up systems and trailing them beforehand will avoid delays and the potential for security breaches.
Protocols, Security, and Documentation
On onboarding, training on in-house (client) protocols must include delivery of any in-house documentation. Work practices, systems, and practices must fully align.
Want to know more?
The best CPA accounting outsourcing services are designed with flexibility in mind.
For example, Outbooks’ outsourced accounting for CPA firms is highly regarded. The firm is a top accounting outsourcing company, partnering with CPAs and accounting firms globally and across industry sectors.
US-based CPA or accountancy firms looking to outsource bookkeeping for accountants or accounting work are invited to contact us to find out more. You can see more about how Outbooks aligns with CPAs and accounting firms by checking out our accounting outsourcing tutorials.
FAQs
Where do I start? How do you find the right firm to outsource financial accounting services to?
CPAs should research accountant outsourcing providers with credentials and experience at the CPA level. You should request client references and check their certification. Suitable providers should have expertise in international accounting standards and knowledge of global tax regulations and business law. You should inquire about their data security measures and technology infrastructure.
Can CPAs and accounting firms outsource any part of their business?
Whatever your inquiry, you can bet an accounting outsourcing provider will be able to supply the service. Services tend to range from routine data entry and bookkeeping and back office services to accounts payable/receivable, bank reconciliation, tax return preparation and filing, financial statement preparation, payroll, financial analysis, and business advisory/consultancy.
How much do CPA outsourcing providers cost?
How much outsourcing will cost depends on the provider and the type, duration, and volume of the project. Some providers, like Outbooks, provide an engagement model that is designed to fit any budget. Other providers charge by the hour. Some will charge per piece.
How much could my firm save from outsourcing?
CPAs typically benefit from reduced labor costs, including in recruitment, training, and lower payroll bills. The ability to scale up and down can lead to lowering infrastructure expenses. The reduction in financial errors and penalties mitigates the risk of agitated clients and improves reputation.
Conclusion
US-based CPAs/accountants are using accounting outsourcing more and more to cater to the complex needs of modern businesses and keep abreast of changing regulations in global business and tax law.
Outsourcing bookkeeping and accounting can be transformational for CPAs and accounting firms. It can enable them to deliver personalized services to clients and nurture client relationships.
It will likely optimize operations and lead to a reduction in overhead costs.
Parul is a dedicated writer and expert in the accounting industry, known for her insightful and well researched content. Her writing covers a wide range of topics, including tax regulations, financial reporting standards, and best practices for compliance. She is committed to producing content that not only informs but also empowers readers to make informed decisions.