STAYING COMPETITIVE: ADOPTING OUTSOURCED BOOKKEEPING AS A STRATEGIC ADVANTAGE FOR ACCOUNTING FIRMS

Staying Competitive: Adopting Outsourced Bookkeeping as a Strategic Advantage for Accounting Firms

Staying Competitive: Adopting Outsourced Bookkeeping as a Strategic Advantage for Accounting Firms

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New research findings show interesting benefits that accrue to organizations that decide to work with outside contractors in their accounting activities. At least 51% of the organizations that have outsourced a whole segment of tax functions or operations to their outsourcing partners report significant financial gains. Namely, approximately over half of these firms state that they have significantly decreased their operating costs.

Furthermore, the benefits do not end at the cost reduction level. About 54% of firms that practice accounting outsourcing observe that such an approach has given them access to modern technologies. This technological edge is very important, especially in today’s dynamic world of accounting and financial reporting.

Outsourcing of bookkeeping services is the one that has received increased adoption over the recent past years. This not only aids the firms to achieve operational efficiency but also grants them a multitude of competitive edge that can assist them in moving ahead of rivals. Let's understand how outsourced bookkeeping can be a change-maker for accounting firms looking to improve their competitive position.

The Changing Landscape of Accounting


First and foremost, it is crucial to discuss the obstacles that currently confront accounting companies because knowing the potential hurdles to outsourced bookkeeping will allow a clearer understanding of the advantages of this practice. The industry is undergoing rapid transformation due to several factors:

  • Technological advancements: The advances in information technology through the use of cloud computing, artificial intelligence, and automation have drastically altered the process of carrying out accounting activities.

  • Increasing client expectations: It is no longer enough to deliver values that merely show sums of computations; people want solutions that provide strategic advice.

  • Regulatory complexities: Concepts such as taxation laws and regulations in business are dynamic, and thus, dealing with them can pose a challenge to firms.

  • Talent shortage: The competition to hire competent accountants can be high because most firms experience a high demand for accountants during busy periods.

  • Cost pressures: When it comes to quality, in an attempt to deliver high-quality services while at the same time making the service affordable to their customers, firms face this dilemma.


In this context, outsourced bookkeeping is identified as one of the multifaceted approaches that might help solve many of the presented problems and have more advantages.

The Strategic Advantages of Outsourced Bookkeeping


Outsourcing of bookkeeping therefore leads to the following advantages:

1. Cost Efficiency


The use of an external provider can also mean that firms need not spend as much on trying to maintain an internal program such as the costs of recruiting, training, and employing bookkeepers, providing office and computing facilities among others. These enable the firms to provide their clients with more affordable prices which in turn helps in increasing their market share witout compromising on their profitability.

2. Focus on Core Competencies


Relieving the accounting firms from the day-to-day tasks of bookkeeping is also an advantage of outsourcing since they can tend to focus on their strengths. Firms can shift their focus towards tasks that add greater value like financial analysis, planning, and consultation. It also makes sense to improve the bolded parts of the value proposition since they increase the satisfaction and loyalty of clients.

3. Access to Specialized Expertise


Accounting firms can gain a walk through an increased kind of expertise through a team of partners without having to train other employees. Be it business vertical experience or experience in the latest domain of accounting and financial tools, outsourcing can bring in the right kind of skills, which would upgrade the quality of the services offered to the client.

4. Scalability and Flexibility


Accounting firms often have that high-pressure season when demand just shoots up. Outsourcing bookkeeping tasks will allow accounting firms the space to handle important tasks and also permit outsourcing companies to increase or decrease the extent of the contracted capability for bookkeeping at a given time. This is especially helpful for smaller firms that have limited staff and have to handle increased activity during the peak seasons.

5. Improved Technology Adoption


Most bookkeeping outsourcing providers have embraced improved technological advancement in the field of accounting. Through such collaborations, accounting firms can tap new technologies and applications at reasonable costs and do not have to make huge expenses upfront.

6. Improved Data Privacy & Security Measures


Choosing bookkeeping outsourcing partners that are reputable means dealing with service providers that have rigid security protocols and standards in terms of compliance. This can level up the situation regarding data security for most firms with a significant number of them not having adequate resources to institute better security protocols.

7. 24/7 Service Capability


Outsourced bookkeeping means that firms, partnering with providers located in another time zone, can provide their clients with more working hours for the same amount of trade-offs from their side without overpaying their employees for the extra working hours.

8. Faster Turnaround Times


An outsourcing partner may often be quicker than an internal team that is exclusively doing bookkeeping work. It can also lead to faster reporting and quicker provision of information to clients, which would improve the quality of service.

9. Risk Mitigation


There are certain advantages of outsourcing accounting: risks related to internal accounting can be mitigated by distributing bookkeeping work to an external partner. Some of these include the reduction of the effect of staff turnover problems, the reduction of errors due to flow, and the assurance against business disruption in the event of unexpected disturbances.

10. Competitive Positioning


Using outsourced bookkeeping practices can also greatly improve the competitiveness of the accounting firm. Reducing expenses, enhancing the quality of the offered services, and shifting to mass-targeted, high-added value, consultancy services can become the key strategies for the differentiation of the wave of similars and gaining a new pool of clients.

Implementing Outsourced Bookkeeping: Best Practices


As is with many things in business, there are clear advantages to outsourcing bookkeeping, but they should be implemented correctly.

  • Choose the right partner

  • Start small

  • Communicate clearly

  • Invest in training

  • Monitor quality

  • Leverage technology

  • Continuously evaluate and adapt


Accounting firms are constantly searching for opportunities to improve the overall delivery and effectiveness of their services and at the same time, do so efficiently and effectively. Contracting bookkeeping services provide a strong competitive weapon for firms who can achieve maximum value of economies of scale, appropriate cost objectives, and serve customers with value-added services resulting from outsourcing. When done correctly and in conjunction with the industry standards, it positions accounting firms to take advantage of the changes in the industry. If you are looking for outsourcing services for your accounting firm, visit www.igsbookkeeping.com.

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