The new year is the time when accounting and tax professionals gear up for the busy season. During this time of year, there is significant pressure for accounting professionals to consider outsourcing certain parts of their businesses to outside providers or processors. The concept of accounting and bookkeeping outsourced operations is not at all new. Tax preparation, for example, has for years been something that could be shipped off to an outside party for processing (remember the service bureaus?). The difference is that now there is pressure to outsource the bookkeeping - the daily transaction processing and recordkeeping that is a standard part of any business.
Outsourcing the regular transaction processing or bookkeeping for businesses is not a particularly new concept. It is the offshore aspect of the model that introduces the new wrinkle. Businesses such as GE and others have been involved in this type of outsourcing for years. In most cases, up until just a few years ago in fact, mostly larger companies were involved in offshore processing, and mainly handled these processes within offshore business units and related business entities. Additionally, the platform and applications required to effectively facilitate the necessary collaborative environment were expensive and complex. Offshore outsourcing, in volume, was primarily a big company option. No longer is this the case.
The small-business market, unlike the mid- and enterprise markets, utilize the general services of public accountants in much greater volume and typically for more fundamental business services such as business bookkeeping. Larger organizations typically employ accounting and bookkeeping departments and/or personnel, and rely on outside accounting professionals for higher-level work. Small businesses, however, outsource much more of the core bookkeeping and checkbook management functions to their public accountant. This creates a volume of fairly mechanical work (data entry, document management and filing, etc. ) which can be burdensome and not terribly profitable for many practices. But this level of work is of significant value to the small business owner, and thus the value of outsourcing to the accounting professional is clear.