The future of outsourced accounting services will largely determine the fate of accounting itself. Businesses that adopt this accounting strategy and increase their bandwidth, freeing themselves to focus on core business principles more cost-effectively.
Companies that continue to use the old accounting method of hiring in-house accounting teams will continue to struggle. They will falter because they will spend more time creating policies and having humans perform mundane tasks rather than automate these tasks. This will not only cost them valuable time, but they will also have to waste time and company resources finding, hiring, and onboarding these new employees.
Outsourcing to an accountant gives business owners the chance to focus on what’s important, without having to worry about their regulatory duties. From bookkeeping to management operations; businesses can save enormous amounts of time passing the torch. Accountants also generally have access to automation processes at their finger tips, allowing accounting procedures to be carried out in a much more effective, and efficient manner, which in turn can save you both time, and outsourcing fees.
Accounting Outsourcing- Busting the Myths
A general misconception began in the IT sector during the 20th century- outsourced accounting is a new invention. In fact, outsourced accounting has been around since then, but it wasn’t sustainable to view it as an outsourcing model.
Most accounting firms follow the same model, a model that was passed down from Great Britain to the Big 4 US accounting firms- consulting/audit forms that eventually blossom into legal outsourcing practices. Outsourced accounting has become a popular business model ever since, as more and more businesses/accounting firms/accountants outsource their non-core accounting tasks to outside firms, even going so far as to internationally outsource these operations.
The truth is that outsourced accounting has always been around. 21st-century commodities simply make it easier, more affordable, and more effective to choose outsourced accounting as a viable method. With the dawn of the internet, the increased complexity of eCommerce accounting, and the rapid expansion of globalism, there will continue to be a shift towards outsourced accounting operations. When you look at the benefits they provide, it’s easy to understand why.
More Time to Drive Core Business Principles
Outsourcing’s most apparent advantage is the time it provides companies to focus on their core business principles. Organizations no longer have to create procedures for mundane accounting tasks. They also don’t have to waste time worrying about the hiring and onboarding process.
When businesses outsource their accounting operations, everything becomes the provider’s responsibility, freeing the entire organization to focus on their specific roles instead of the financial ramifications.
Upgrading to the Latest Business Trends
Since outsourcing can release you from tedious burdens such as bookkeeping, compliance, and tax filing, your employees can sharpen their skills and improve your business in the way it needs to stay competitive. If your business always focuses on adapting to the shifting environment.
The Future Is Technology-Driven
Without a doubt, technology will continue to drive the shift from in-house accounting teams to outsourced accounting teams. Things such as blockchain technology and artificial intelligence will continue to shape the way businesses perform their accounting operations, shifting to more of an outsourced model.
Don’t let the threat of artificial intelligence scare you. Robots won’t replace people in corporate finance. The tasks that used to require people will only require automation. You can picture this transformation as akin to the automatic teller machine or ATM. Just because ATMS arrived doesn’t mean tellers became obsolete- they were just free to focus on more complex problems.
Experts suggest that automated programs will handle 30 times the number of tasks an average human can complete in the same timeframe. However, these types of automated programs aren’t equipped to adapt yet. They have a finite number of tasks programmed and they can’t deviate from those.
The Future Will Divide Accounting Into Operations
As suggested, accounting is less and less about everyday operations and increasingly about large-scale financial decision-making. CFOs of the future won’t handle the day-to-day activities as much as they will steer the ship using daily financial metrics churned out by automation.
This business model allows organizations to increase their financial strategy team instead of having mere controllers handle their accounts.
Virtual Accounting Teams Will Replace More and More In-House Teams
Not long ago, Entrepreneur suggested companies outsource the following roles: highly knowledgeable in one area, highly repetitive, and highly specialized. There are a few reasons to outsource roles such as these. Automation can replace repetitive roles. They might eventually be able to replace the highly technical and the highly knowledgeable.
However, for now, those roles need to be outsourced to professionals who have a firm grasp of very specific tasks or who have the skill to carry out highly technical tasks. You want to outsource these positions because it’s challenging to vet candidates for a job you’re not technically qualified for. How can you expect to decide on a candidate if you don’t know how to do what you’re hiring them for? Outsourced teams give you the peace of mind that comes from knowing these jobs are in qualified hands.
What Do These Changes Mean for Business Owners?
The wave of automation simply means business owners need to adapt. These tendencies show no signs of stopping, and owners who think the world will return to what it once was will be sorely mistaken.
Owners need to start considering how they can get ahead of the trends instead of fighting them. Owners need to incorporate new technologies and respond to the increased need for outsourced specialists to consult them on financial decisions.
The Wave of Automation Has Only Just Begun
The stats show organizations that aggressively adopt automation and outsourcing are outperforming those reluctant to change. According to PWC’s Finance Effectiveness Benchmark Report from 2017, these organizations spend 20% less time gathering data and 36% less money on operations than their counterparts.
Conclusion- The Future of Outsourced Accounting
The future of accounting relies heavily on outsourced operations. And the future of outsourced operations relies heavily on automation. These two elements go hand-in-hand and demonstrate a broader trend toward automation. Businesses need to incorporate these new technologies and consider which roles they need to outsource, or they stand to lose a substantial amount of money.
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