What Are the Benefits of Offshore Accounting?
Offshore accounting offers numerous benefits for your small business. Along with streamlining business processes, offshore accounting also helps your company expand its reach.
It also helps you obtain a competitive advantage by gaining valuable services at better prices while increasing your productivity.
What Is Offshore Accounting?
Offshore accounting is the process of outsourcing your accounting tasks and other financial processes to employees in a different geographical location. The location is often a low-cost country which significantly lowers business costs.
Accounting is a critical task for all businesses. Traditionally, business owners preferred in-house teams. However, with the COVID-19 pandemic many workers prefer remote operations giving rise to more offshore accounting companies that offer the same services at better rates.
Statistics place accounting as one of the most outsourced functions for SMEs in America. It is useful when you need help with various accounting tasks such as:
- Tax compliance
- Income tax returns
- Tax preparations
- Financial reports
- Bookkeeping
- Accounts receivables
- Accounts payables
- Inventory management
- Payroll management, and others
To boost growth for your business, offshore accounting services might just be the solution you need.
Benefits of Offshore Accounting
So, what are some benefits of offshore accounting services? Let us find out.
1. Improved Compliance
With offshore accounting, you never have to worry about incomplete paperwork or missing tax deadlines. Your accounts outsourcing partner handles all these processes for you making it easier for your business to remain compliant.
Many entrepreneurs understand that to grow your business, you must stay updated on all its accounting functions. Offshore accountants are experienced in various accounting functions including compliance regulations which goes a long way in helping you meet specified guidelines with ease.
2. Increased Cost Savings
For most small and medium enterprises, cost savings is high on the list of priorities. Hiring financial and accounting professionals in low-cost countries saves you money on training, purchasing in-house hardware and software, as well as year-round salaries.
In addition, the greater economies of scale mean you save money by hiring fewer people to get different tasks done.
3. Access to Better Talent
Hiring offshore accounting professionals gives you access to a bigger pool of better talent than you would find locally. It is not unusual to find highly educated professionals who are open to doing entry level tasks such as data entry at better rates.
4. Improved Efficiency
Like most external service providers, offshore accounting professionals focus on the specific services they are tasked to deliver. This means that you get highly specialized results within the shortest time frames.
Offshore teams also have extensive knowledge of different policies and can help you handle complicated tax issues with better clarity.
While managing an internal team can cost you both time and money, offshore accounting frees up your time, so you can stay focused on generating revenue.
5. Access To New Technology
Offshore accounting teams specialize solely on providing this service to multiple companies. It makes sense for them to invest in the latest software and hardware so that they can deliver their services faster and more accurately.
This makes it cheaper to rely on their technology than to purchase and periodically update in-house accounting technology.
Offshore accountants equipped with updated software can also deliver highly customized and accurate reports that are critical when making business decisions.
6. Shared Operational Management
Another benefit of offshore accounting is shared operational management. An in-house accounting team would need office supplies, furniture, workspaces, desktops, accounting software, and other requirements all of which are supplied by the employer.
You would also be required to provide a conducive work environment and ensure that all employees whether permanent or temporary meet labor compliance standards such as ISO.
By outsourcing your accounting operations, these responsibilities are shared with your offshore accounting partner. You can also reduce time spent on hiring, evaluating, and managing employees.
7. Reduced Errors
Bookkeeping, accounting, and other financial functions require a high level of accuracy. Your team must be skilled, focused, and competent enough to manage these functions.
For small and medium enterprise owners, it may be difficult to manage multiple aspects of business and stay on top of all your accounting tasks. Many solo business operators fall short resulting in penalties and additional costs caused by bookkeeping errors.
Offshore accounting allows you to outsource this part of your work to employees who can dedicate their time and expertise to your financial functions. Their experience handling financial records and paperwork for multiple organizations ensures that there are little to no errors.
You also save time and can comfortably meet your tax deadlines.
8. Flexible Hiring
Offshore accounting gives you the flexibility to only hire bookkeepers when needed. With more accounting processes becoming automated, you can hire an offshore team for quarterly financial reports or on temporary basis.
Along with flexible hiring, you can also scale your employees up or down as required.
How to Find Offshore Accounting Services
Most small and medium businesses look to the Philippines and India for offshore accounting services. These two countries are known for their highly educated and experienced finance professionals who offer their services at cost-effective rates.
A quick online search will give you plenty of options to choose from. However, here are a few factors to consider before contracting a new offshore accounting company.
- Cost-effectiveness: Any partner you choose should help you save money.
- Expertise: Your offshore accounting team should have the skills and expertise required to successfully execute assigned tasks. Consider working with a company that hires professionals with validated credentials.
- Reliability: It is important to have an accounting team that can secure your data and give you accurate results within the set deadlines.
- Technological infrastructure: A team equipped with the most advanced technology can make all the difference in your finances. The results are not only more accurate, but they are also produced with speed.
- Service customization: Consider working with a company that offers bespoke services to suit your business needs for optimal results.
- Communication: Choose a team with strong English capabilities to ensure that your communication is more effective. While most accounting systems use English, a team that is not fluent means that some instructions can be misinterpreted.
- Time Zones: Consider working with a team that is comfortable working with your time zone for easier communication.
- Productivity: Working with an offshore team can make it difficult to assess productivity. However, thanks to time tracking apps, you can ensure that idle time is not logged as productive time.
Summary
There is no doubt that hiring offshore accounting companies in Texas has numerous benefits especially for small business owners. Larger organizations however, benefit from an in-house accounting team who look forward to growing with the company.
