Discover Your Business Potential with our Professional Outsourced Accounting for CPA Services
Offering a comprehensive suite of CPA services including tax planning, audit, transaction support, and accounting services, our finance professionals have refined their expertise at leading U.S. accounting firms and are here to support your business.
Introduction
Introduction
Feeling overwhelmed by the ever-growing demands of your clients? Struggling to find qualified staff in a competitive market? You’re not alone. Today’s CPA firms are juggling a multitude of challenges – complex regulations, demanding clients, and a talent shortage that shows no signs of slowing down. However, amidst these hurdles lies an opportunity for growth and enhanced service delivery through strategic outsourcing. Here’s what you need to know…
What are outsourced accounting, finance, and auditing for CPA businesses?
As a CPA firm, you may find yourself stretched thin managing the day-to-day accounting needs of your clients. Outsourcing accounting, finance, and audit services means contracting with a third-party provider to handle some or all of those client needs. Partnering with an outsourced accounting and finance firm gives you access to a team of accounting and finance professionals on an as-needed basis. Collaborating with an outsourced accounting partner is a strategic solution for CPA firms who want to provide more extensive services to their clients.
Why are CPA firms rethinking traditional staffing models?
The main driver is the increasing mismatch between the demand for skilled accounting professionals and the shrinking supply. Factors include retirements, fewer students choosing accounting, and competition from other industries. Many firms are hitting a capacity ceiling with their current in-house team and need different staffing models that can help them grow without adding to the in-house burden.
In addition, clients are increasingly asking for project-by-project rather than recurring engagements. CPA firms need a more flexible approach to staffing that allows them to scale up and down to meet client needs.
What are the benefits for CPA firms of using outsourced accounting and finance?
The competitive landscape for CPA firms is demanding. You need to offer a wider range of services, cater to complex client needs, and navigate staffing challenges. According to a survey by alliantTalent, 74% of CPA firms are introducing fully remote roles, and 79% are using technology for basic tasks. Partnering with an outsourced accounting and finance company offers several benefits:
- Expand your services and/or expand into new markets: Joining forces with an outsourced accounting and finance partner empowers your CPA firm to become a service powerhouse. You gain access to a wider talent pool with specialists in bookkeeping, tax filing, audits, and more. This broadens your service offerings, allowing you to take on new clients and cater to industry-specific needs. Plus, you can tap into a network of specialized skills on a project basis, such as specialist skills in technical accounting or international tax.
- Flexibility and increased capacity: During busy tax and audit seasons, your CPA firm can seamlessly scale up its teams with qualified professionals from your outsourced partners. This frees internal staff to focus on higher-value client services while optimizing workload and avoiding the fixed costs associated with additional permanent hires.
- Time for strategic focus: By delegating routine tasks, you reclaim valuable time for strategic planning and business development, which allows you to develop a long-term growth strategy, stay ahead of the competition, and proactively adapt to the ever-changing industry landscape.
- Cost-effectiveness: Hiring full-time accounting and finance staff in this market can be expensive and challenging. Outsourced accounting and finance support offer a more cost-effective option for CPA firms.
- Access to up-to-date technology: Outsourced accounting and finance companies like Scrubbed have access to the latest accounting software and tools and experience establishing effective workflows. For CPA firms this translates to improved efficiency and a way to provide better service to your clients.
- Enhanced quality control and accountability: Outsourcing partners are committed to maintaining high standards of service. This commitment includes rigorous quality control processes and accountability measures that enhance the overall quality of work delivered to your clients, ensuring that all services meet or exceed professional standards.
How do hybrid and outsourced staffing models work for accounting firms?
Hybrid means team members may work remotely, part- or full-time, from anywhere in the world. It can include in-office, remote, and partially remote staff. The hybrid model allows firms to access talent outside their geographic region and create more flexible work environments.
Outsourcing involves delegating specific tasks, processes, or projects to an external partner, who becomes an extension of your team. This can be a partial or complete delegation and can include partners in the same region or country as well as international partners.
Offshore vs. near-shore:
Understanding geographical differences in an outsourced accounting and finance partner
For CPA firms considering outsourcing accounting and finance tasks, the location of the outsourced partner can significantly impact efficiency and communication.
Near-shore outsourcing involves partnering with a firm in a neighboring country, often sharing a similar time zone. This offers advantages like easier collaboration due to fewer time zone hurdles and potentially shared cultural understandings. However, cost savings might be less pronounced compared to offshore options.
Offshore outsourcing, on the other hand, refers to partnering with a firm in a distant country, typically with a significant time difference. This approach offers the potential for substantial cost savings due to lower labor costs. However, communication challenges can arise due to time zone differences and cultural barriers.
The right partner eliminates the friction often associated with outsourced services.
The right partner eliminates the friction often associated with outsourced services.
They should offer clear, responsive communication channels that align with your firm’s operational rhythm, ensuring that collaboration feels as natural as working with an in-house team, regardless of time zones or geographical distances.
How can outsourced accounting, finance, and audit services create a competitive advantage for CPA firms?
Outsourcing some or all of your clients’ accounting, finance, and audit needs can be a competitive advantage for your CPA Firms because it offers additional capacity to service your clients, with seamless access to a wide range of specialized accounting, finance, and tax skills as well as insight and experience in industry-specific nuances. This strategic alliance enables your firm to broaden its service offerings without the need to expand permanent staff, thus optimizing resource allocation and enhancing flexibility in service delivery.
Partnering with an outsourced accounting firm also frees up time for executives to focus on the strategic needs of the business, making it possible for your firm to adapt more quickly to market changes and opportunities.
Is outsourcing only for large firms?
Outsourcing can be effective for firms of all sizes. Smaller firms can benefit just as much as larger ones, using external partners to fill gaps, access specialized skills, and scale up or down as needed. The key is finding the right partner and building a strong working relationship.
How should a CPA firm get started with outsourcing?
Begin by assessing where your internal capacity falls short and carefully consider which tasks and processes are best suited for delegation and how much oversight you want to maintain. Choose partners who meet your standards for quality, security, and handling sensitive data.
How do you choose the right outsourced accounting, finance, and audit partner for your CPA Firm?
Not every outsourced firm will be the right match for you and your clients. In the survey by alliantTalent, 75% of CPA firms are now considering hiring employees without the conventional graduation requirements due to the shortage of candidates.
Not every outsourced firm will be the right match for you and your clients. To find a partner who enhances your firm’s services, consider:
- Define capabilities: Start by clearly identifying the specific tasks you want to outsource. Evaluate your and your clients' short- and long-term needs to pinpoint areas where additional expertise is required or where you wish to expand services. This will guide you in selecting a partner that excels in precisely what you need, whether that’s day-to-day accounting tasks, specialized financial reporting, or comprehensive audit services.
- Set your criteria: Develop a checklist of essential qualities and capabilities for your outsourcing partner. This should include their experience with similar clients, industry-specific knowledge, and their adherence to critical standards like US GAAP or IFRS. Additionally, evaluate their technology stack, communication protocols, and security measures to ensure they can customize their team to match the scope and complexity of your projects.
- Consider communication and integration: Effective communication is key. Opt for a partner with a team that is not only fluent in English but also matches your communication style. They should integrate seamlessly with your firm’s existing processes and be flexible enough to meet during your preferred hours, despite any time zone differences.
- Assess cultural fit: The right partner should align with your firm’s mission, vision, and values. Look for a partner who is committed to a relationship that transcends mere transactions; one that is dedicated to mutual growth, understands your long-term objectives, and works alongside you to unlock new opportunities.
- Evaluate their track record: Choose a partner with a proven track record of high-quality service delivery to CPA firms. This involves not just meeting expectations but also consistently exceeding them with superior quality control measures.
- Innovation and future-readiness: Your chosen partner should bring innovative solutions and advanced technologies to the table. This forward-thinking approach ensures that your firm stays ahead of technological advancements and market trends, maintaining a competitive edge.
- Seamless team integration: Finally, ensure that the outsourced partner can blend smoothly with your existing team and clients. This integration is crucial for maintaining continuity, quality of service, and client satisfaction.
What are outsourced accounting, finance, and auditing for CPA businesses?
How does a CPA firm onboard an outsourced accounting, finance & audit firm?
Building a strong foundation for a long-lasting and collaborative relationship with your outsourced accounting partner starts with a smooth onboarding process. Here are some key strategies to ensure a seamless integration:
- Share information: Establish secure methods for sharing client financial data with your partner and grant them access to the necessary accounting software and applications. Remember, client data security is paramount. Look for an outsourcing partner with robust data security measures that meet industry standards and regulatory requirements. This might include secure data storage, access controls, and disaster recovery plans.
- Introduce the team: Facilitate introductions between your internal team and the outsourced professionals. Clearly define communication channels and roles within the team to foster a collaborative working environment.
- Standardize workflows: Outline clear workflows and procedures to ensure consistent and efficient service delivery from the start. This will benefit both your team and your clients.
- Pilot launch and optimization: Consider running a pilot project with a small sample of tasks. This allows you to test the waters, identify any initial challenges, and make adjustments as needed before full implementation. Agree on a timeline, training plan, and logistics (like file sharing) for the pilot project beforehand.
What are some best practices for a CPA firm working with an outsourced accounting, finance, and audit partner?
For outsourcing or hybrid models to succeed, external partners need to be treated as an extension of your team—not just as contractors. That means involving them in onboarding, training, and even cultural or team-building activities to help them understand how your firm operates and what matters most. Some best practices to ensure a good working relationship and successful outcome include:
- Clear communication and expectations: Set the foundation for success by clearly outlining your expectations from the outset. This includes defining the scope of work, deliverables, timelines, quality standards, and communication channels. Regular communication is crucial for smooth collaboration and addressing any issues promptly.
- Focus on collaboration: View your outsourced partner as an extension of your team, not a separate entity. Foster a collaborative relationship through regular communication, knowledge sharing, and joint problem-solving. This will ensure everyone is on the same page and working towards the same goals.
- Performance Measurement: Establish key performance indicators (KPIs) to track the effectiveness of the outsourced relationship. These metrics could include accuracy, timeliness, communication, and cost-effectiveness. Regularly monitor KPIs and use them to identify areas for improvement and ensure you're getting the value you expect.
How does a CPA firm measure the success of a partnership with an outsourced accounting, finance, and audit team?
Some ways you can measure the success of your partnership include:
- Clear communication and expectations: Set the foundation for success by clearly outlining your expectations from the outset. This includes defining the scope of work, deliverables, timelines, quality standards, and communication channels. Regular communication is crucial for smooth collaboration and addressing any issues promptly.
- Focus on collaboration: View your outsourced partner as an extension of your team, not a separate entity. Foster a collaborative relationship through regular communication, knowledge sharing, and joint problem-solving. This will ensure everyone is on the same page and working towards the same goals.
- Performance Measurement: Establish key performance indicators (KPIs) to track the effectiveness of the outsourced relationship. These metrics could include accuracy, timeliness, communication, and cost-effectiveness. Regularly monitor KPIs and use them to identify areas for improvement and ensure you're getting the value you expect.
- Increased capacity: Outsourcing can help CPA firms meet seasonal demands or take on new clients without having to increase their headcount. This can be measured by tracking the number of clients served or the amount of revenue generated.
- Enhanced service quality: Outsourcing can allow CPA firms to offer a wider range of services delivered by qualified professionals. This can be measured by client satisfaction surveys or by the number of new clients acquired.
"With the help of our Scrubbed partnership, we have improved the retention of our audit staff, making sure that we are evenly spreading the work throughout the year. We've been able to grow our practice by 10% annually. "
Stacey Massa
Partner at UHY LLP and Managing Director at UHY Advisors
What changes are expected in accounting firm team structures over the next few years?
Some ways you can measure the success of your partnership include:
- Clear communication and expectations: Set the foundation for success by clearly outlining your expectations from the outset. This includes defining the scope of work, deliverables, timelines, quality standards, and communication channels. Regular communication is crucial for smooth collaboration and addressing any issues promptly.
- Focus on collaboration: View your outsourced partner as an extension of your team, not a separate entity. Foster a collaborative relationship through regular communication, knowledge sharing, and joint problem-solving. This will ensure everyone is on the same page and working towards the same goals.
- Performance Measurement: Establish key performance indicators (KPIs) to track the effectiveness of the outsourced relationship. These metrics could include accuracy, timeliness, communication, and cost-effectiveness. Regularly monitor KPIs and use them to identify areas for improvement and ensure you're getting the value you expect.
- Increased capacity: Outsourcing can help CPA firms meet seasonal demands or take on new clients without having to increase their headcount. This can be measured by tracking the number of clients served or the amount of revenue generated.
- Enhanced service quality: Outsourcing can allow CPA firms to offer a wider range of services delivered by qualified professionals. This can be measured by client satisfaction surveys or by the number of new clients acquired.
Conclusion
As you navigate the challenges of the accounting industry, remember that outsourcing can be a powerful tool to help your CPA firm thrive. By partnering with the right accounting, finance, and audit services provider, you can expand your capabilities, increase efficiency, and free up time to focus on strategic growth. To ensure success, be sure to choose a partner that aligns with your firm’s specific needs and goals, and establish clear communication and collaboration practices. With the right approach, outsourcing can help you drive the results you’re looking for and take your firm to the next level.