Outsourcing is not a new concept. For many years this strategy has been implemented with great success for many small businesses. However, in recent years, it has become a trend among myriad industries or businesses to outsource their yearly function of accounting and bookkeeping in Dubai. It is a service extensively sought out by small or medium businesses, but even large businesses can outsource their Accounting. The service gives the business a full-fledged accounting department-like experience. The goal of such service providers is to assemble the accounting experts in one place and utilize their expertise to provide help to the firms that cannot afford a regular accountant to look over business transactions. These service providers allow such firms to get their required records sorted out through expert hand at a low cost as hiring a Qualified Accountant for a business is very costly given their high payment rate. Such departments provide all sorts of everyday accounting services such as recording of monthly or yearly accounts receivable and payables, day-to-day transaction coding, management of financial reporting, payroll, etc. With cloud accounting software such as Xero readily available, there is now less need for accountants to be on site.
Summary of Services Provided by Outsourcing Firms:
- Processing of real-time transactions.
- Issuing sales invoices.
- Payment list of vendor bills.
- Processing of payroll.
- Preparing Analytical Reports.
- Cashflow Forecasting & budgeting.
- Tax Compliance
Is Outsourcing your Accounting function right for you?
You can become the most eligible client enjoying outsourcing services:
- If you are a business owner who is spending too much time managing accounting information while neglecting the crucial sectors that need your attention.
- When you are working in a hectic manner due to a lack of expertise in book-keeping.
- If you need a professionally put-out financial report but neither can you afford it, nor do you need a full-time Qualified Accountant.
- You can become efficient to some scale by recruiting a Qualified Accountant. Hiring a Qualified Accountant is, of course, more efficient when talking in terms of work, but if you are running a small business, chances are, the work efficiency provided by a Qualified Accountant is unnecessary, and maintaining such high personnel costs becomes too expensive. Hiring your Accountant includes incurring other costs such as medical insurance, end of service benefits, IT, and time spent on managing staff.
- It reduces your year-end work by giving you a more organized outlook of your fiscal reports. Hence, by the year ends, you do not have to go crazy while sorting out the data all around the place which will undoubtedly not be as well put out and accurate as it may be when done by an expert.
- It also helps you avoid penalties by the FTA during the VAT season. How? Late submissions or incorrect submissions are now issues that can escalate tension with the tax authorities. Many businesses are beginning to focus on their taxes well before submissions are due. They end up paying fines if they're not ready on time, or if they hurry and don't report all their deductibles. This way, they're losing money.
Professional accountants work on the firm's financial reports every month. It's just a matter of final checking when the quarter ends – no last-minute VAT-time rush!
- It saves a lot of the time that you have to invest in data processing and bookkeeping. Instead, you can use this time for yourself or seek ways to make your small business flourish.
- Being an owner of a firm of various sizes, sadly, does not avail you of the opportunity to get access to a lavish form of business. Hence, when it comes to book-keeping (which is the most essential pillar holding any business strong) you cannot get yourself to install advanced software to work at ease and give you the most accurate processing of your data. That is when an accounting firm can help you out. They make use of expert brains and expert machinery to give you the most well-put-out financial year reports of your firm.
- It, of course, reduces a lot of risks that you may have faced while handling the work yourself or through inexperienced hands. Expert hands and high-tech software impose the minimal risk of mishandling information and yearly or monthly records.
- It increases the profitability of your business because outsourcing helps you to concentrate on your core business with limited capital, so you can be more competitive. You can spend more time with your clients so that your company can offer them a higher level of service. It helps you to concentrate on strengths and sort out ways to best utilize them.
- You can make better business decisions at a faster rate. Faster, more reliable, and more effective delivery of higher-quality accounting information is important. Working with accounting professionals would offer more accurate information in less time to make informed business decisions.
Should You Outsource Accounting Functions?
The decision depends completely on the size of your business as well as your instincts. However, you would not need to waste time and money trying to keep up with an influx of new regulations, strategies, procedures, and technology. Missing vital market signals because you cannot access the financial information in the form you need would position you at a distinct disadvantage in today's highly competitive climate. Always try offering your customers some new products and/or services. How? Hiring outsourced services will help you if you have always been interested in providing your customers with such new services but could never pursue the project because of insufficient time and expertise. Offering your clients new services is just like adding new revenue sources and making the best use of your own and externalizing skills and expertise. When you outsource your accounting functions it helps you with facing the consequences of a sudden loss of employees. You could be in a situation where your workers quit unexpectedly if you were running your company long enough. In such events, most businesses cannot afford buffer workers. Fortunately, don’t worry about situations regarding hiring accounting and book-keeping of your business records because the outsourcing company’s characteristic is to have a team of expert, trained, experienced, reliable, and ready-to-have effective “safeguards” or accountants. Such teams test and double-check the work of each other before transmitting it to you so that you continue to maintain your work quality. At the end of the day, it’s your judgment so consider different aspects of your business before you make a quick decision.
This article is written in general terms and therefore cannot be relied on to cover specific situations; application of the principles set out will depend upon the particular circumstances involved and we recommend that you obtain professional advice before acting or refraining from acting on any of its contents.