4 Pitfalls To Avoid When Outsourcing Accounting Services
Truth be told, not all business owners in Singapore are fond of number crunching. They may be excellent at other aspects of business, but preparing financial statements and trial balance might just not be their forte. Nonetheless, these business owners cannot deny that accounting is one of the most critical business operations. Expenditure reports and income statements are essential to making more informed business decisions.
Therefore, to reconcile their lack of accounting skills and their business’ need for accounting services, business owners either hire in-house accountants or outsource accounting in Singapore. Between the two options, outsourcing is becoming more and more preferred due to its efficient and cost-saving benefits.
However, outsourcing can also bring about a number of issues, especially if you have outsourced your accounting services from the wrong provider. That said, finding a reliable provider to outsource accounting functions can also be quite taxing. To help you make the right choice, we share four of the most common mistakes you should avoid when outsourcing accounting services.
1. Settling for the cheap services
One of the primary reasons why businesses outsource is the potential savings it can provide them with. However, paying less does not translate to good service at all times. When choosing the accounting services you will be outsourcing for your business, price should not be your sole criterion. As a matter of fact, depending on the price alone may even be one of the biggest mistakes you can make.
Since you are paying the outsourced provider a relatively lower rate, they will most likely work with several clients simultaneously to compensate for the cheap rate they charged you. Most of the time, this means that if another client pays higher, the provider will likely prioritise their needs over yours. To avoid receiving services such as these, it would be best to ensure that you hire a reputable outsourcing firm that provides extensive accounting services at competitive prices, such as OneStop Professional Services.
2. Not researching enough
If you are aware of the classic adage, “knowledge is power,” the chances are that you would know that research is all about creating new knowledge. If you are unfamiliar with how outsourcing works, then research is your best tool. Before making any decision to outsource your business’ accounting functions, you should ideally first gain an adequate understanding of how outsourcing works and search for the best outsourcing firms you can trust.
Outsourcing accounting services requires a significant amount of trust and confidence since you are practically handing over the financial data of your business to a third person. Hence, you would want to make sure that the outsourced provider you hired is skilled, efficient, and trustworthy. Before saying yes to a firm’s offer, it would be good to conduct thorough research or background check on the firm prior. As much as possible, you can consider looking for testimonials or reviews that will tell you how legitimate and reliable the firm is.
3. Providing vague job descriptions
When planning to outsource accounting services, you would need to set your expectations right at the very beginning. This means that you should specify not only the skills that you are looking for but also the tools that will be utilised in everyday operations. Setting a clear job description will make your search and hiring process much easier and faster.
Aside from skills and tools, your job description should also clearly state your preferred method of dealing with issues and potential problems, mode of communication, power outage protocol, security measures, and frequency of work delivery. Essentially, you should ideally be setting clear terms and expectations during the initial discussions and prior to closing the deal in order to avoid causing any disruption to the outsourced accounting services.
4. Failing to integrate the outsourced team fully
This is another huge mistake you should avoid if you desire your accounting operations to run smoothly. Thinking of your outsourced accounting team as offshore or external works instead of an integral part of your company can essentially only lead to the worst outcomes. When outsourcing, your objective should be for your in-house employees and outsourced workers to develop camaraderie and cooperation in the long run.
When your outsourced team is unaware of the goals and objectives your company is trying to achieve, it will likely lead to confusion and demotivation on their part. On the contrary, when the outsource staff are fully integrated into your business, they will likely be more eager and inspired to accomplish tasks and achieve goals. Ultimately, employees, whether in-house or outsourced, become more productive when they are included in discussions and their ideas are being listened to.
Outsourcing accounting functions can indeed help your company accomplish all those demanding number-crunching tasks more easily and efficiently. However, this is only true if you are able to find the right outsourced provider. As plenty of firms already offer outsourced accounting services, it is vital to be more careful and thorough when it comes to the personnel you are hiring and integrating into your business.
For the best and most reliable accounting services in Singapore, OneStop Professional Services has got you covered! A reputable audit and accounting firm in Singapore, we offer various efficient and affordable corporate services, including auditing, accounting, nominee director search, secretarial services, and more. Feel free to contact us today to learn more about how we can help your business grow!