Qualms On Finance and Accounting Outsourcing Fail To Hinder Industry
Finance and accounting outsourcing is one of the branches of outsourcing that has gained traction over the past few years as companies coming from different business sizes have seen the benefits that they can gain from engaging with a finance and accounting outsourcing company. Among the services that outsourcing companies offer are payroll outsourcing and accounts receivables and payables outsourcing. It is this particular department of a company that can be considered as one of those departments that require a high level of patience and a keen attention to detail. The volume being handled in the finance and accounting department of a business is usually heavy, which allows finance and accounting outsourcing companies to pitch in their services to companies as they can easily reduce the burden at a cost that is not heavy on the budget.
The Wall Street Journal reports that there has been a rising demand for outsourcing services. However, despite the efficiency and benefits displayed by outsourcing, there are still those company executives and companies that are quite uncomfortable with the idea; thus, they would rather host their finance and accounting processes in-house. A research report by Ovum shows that a barrier that prevents big companies to outsource their finance accounting processes would be their loyalty to their staff. Peter Ryan, a lead analyst from Ovum, suggests that a combination of a company’s sense of responsibility for their staff and their skill level could be one obstacle that hinders companies from outsourcing their finance and accounting duties.
Another reason that is being pointed out by the research conducted by Ovum would be the high risks that they attribute to outsourcing is the industry’s low-cost pitch. 38.5% of chief financial officers in the United States and in the United Kingdom are having second thoughts with engaging in outsourcing with a service provider, particularly Indian service providers, who offer finance and accounting services for a low cost because they consider this as an “unacceptable” risk and they would be more comfortable in tapping the services of those who offer services at a higher price.
But despite company executives holding back on outsourcing their finance and accounting outsourcing, there are still some companies like Accenture (NYSE:ACN) and Wipro Limited (NYSE:WIT) that are being tapped for this kind of service and they are showing that their businesses are growing mainly because they have already established a name in the industry.
Other outsourcing companies meanwhile are becoming interested to explore the finance and accounting area of outsourcing. As the month of May began, business process outsourcing company, EXLService Holdings (NASDAQ:EXLS), acquired a service provider of finance and accounting services. US-based Outsource Partners International’s 3,700 professionals and 80 clients would add to the 13,000-population of EXLService Holdings. According to the President and CEO of EXLService Holdings, Rohit Kapoor, this particular acquisition will enable their company to be more known in different verticals, as well as strengthen their company presence in three continents in the globe, namely the United States, Europe and Asia.