In today’s business setting work is no longer confined to co-workers zone but rather it involves a number of players including suppliers, partners, customers, freelancers and so much more. Outsourcing is also an integral part of business operations. While the practice is relatively new to many businesses, its impact in business operations especially accounting is now being realized.
Those who regarded outsourcing accounting services with indifference, confusion and outright fear are now embracing it with open arms. As businesses begin to understand the benefits of outsourcing, they are now using the practice to achieve many organizational goals. That’s why we are here to shine some light on misleading myths or unfounded beliefs and facts about outsourcing.
- Myth 1#: Majority of Businesses Outsource Accounting Services To Reduce Costs
- Fact: The primary reason for outsourcing is to increase capability and capacity to achieve global expansion
While cost is a major concern to many companies who outsource labor or expertise, the primary driver to outsourcing is to achieve global expansion and gain access to skills. Outsourcing relationships that are purely based on cost savings have an increased tendency to fail. Hence as companies become more sophisticated and aware of the benefits of outsourcing, they seek to find someone who can do the job efficiently and better rather than someone who offers to do it at a cheaper price. And because the current market is characterized by complex security programs and management, businesses do not have to worry about security safeguards anymore.
- Myth #2: Outsourcing Eliminates Jobs
- Fact: Outsourcing leads to increased efficiency
As much as outsourcing has had a dramatic impact on other development businesses like IT, with jobs being taken by cheaper overseas labor, the accounting industry has not experienced that. Outsourcing actually means you, as a business, get more final output using lower inputs. That in turn translates to lower costs on the local businesses as well as consumers. And with lower prices the workforce can enjoy higher standards of living while the growing economy witnesses more jobs. Outsourcing accounting services can allow the business to:
- Relieve bookkeepers and accountants of the brunt of their work
- Free up both the employer and employee’s time
- With most accounting services operating electronically, storing and exchanging data can be quick with the aid of cloud-based solutions
- The need for regular in-house staff is eliminated leading to complete flexibility
- Myth #3: Outsourcing Leads To Loss of Control
- Fact: The practice helps you handle company goals and decisions better
Most growing entrepreneurs in Singapore do not entertain the idea of outsourcing because they think the practice can lead to loss of the hard-won business. However, the fact of the matter is, rather than you losing command of the enterprise, it helps you offload the accounting work to a professional service provider who can handle the goals and overall financial position of the company better. That will allow you to
- Make better business decisions
- Have regular access to timely and accurate accounting information
- Enjoy running a cherished enterprise
- Myth #4: Do-It-Yourself Accounting Is Better
- Fact: Outsourced services are reliable and more accurate
While there might be great bookkeeping and accounting software available for use, they might not provide an effective tool for keeping track of your finances. The fact that you have the latest accounting software in place doesn’t necessarily mean you’re going to get the most out of it. Majority of businesses in Singapore have failed because they do not make use of their accounting programs. And yet still, those who do spend more resources than necessary to keep proper books of accounting. With growth in business comes complex financial management and so hiring skilled professional accountants becomes the only viable option to keep track of the firm’s finances. Rather than guessing around, you can rely on experts to lessen the load for you to keep your accounting house in order.
