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Anyone examining the benefits of out sourcing must come to an inevitable conclusion. Every company's entire accountancy function should be outsourced, preferably to practitioners in America and India.

The big beneift is cost. However, just as importantly, unlike many UK based accountants, overseas practitioners feel no obligation to act primarily on behalf of HMRC. Indeed many win clients by emphasising their ability to minimise UK tax using legal methods.

Speaking to overseas accountants is such a refreshing exercise. They're quite clearly on your side. At a time of severe recession, this is precisely what we need.

Too many UK accountants have had a culture of developing cosy relationships with HMRC to make things easier for themselves. Others have a bizarre sense of morality where they actively want clients to pay as much tax as possible, because that's what feel is the right thing to do. However, that's not their job.

The mesage is clear: focus more on saving your clients money or lose out.

Doubtless this posting will attract the usual share of whingers, trotting out an array of weak arguments for maintaiing the status quo. However, there will be others - hopefully many others - who will have seen this trend for themsleves, and now recognise it as an terrific opportunity to seize business from the laggards.

Mike Bassy


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By Anonymous
08th Jul 2008 10:53

Interesting article, jc, but I'm not sure how much it impacts on the type of outsourcing used by accountancy firms.

Usually, the outsourcer takes on what is essentially a 'junior' role, preparing a file to the extent where it's ready for a senior review. Most outsourcing firms that I've spoken to or read about are adamant that they will have no contact whatsoever with the clients, and all queries will be forwarded to you to discuss with the client yourself.

Several firms I've spoken to use outsourcing in this way and the client has no idea that an outsourcing arrangement is even in place (just as they wouldn't if you were, e.g. outsourcing to a semi-retired accountant on the other side of town.)

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By Anonymous
08th Jul 2008 09:10

Interesting research ...
Have a look at this

Research into customer perception & loyalty issues associated with outsourcing

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07th Jul 2008 23:00

are you a toffee nosed twit in a fishermans friend jumper?
or simply a waste of space?

...and for the earlier fool the word questioner has fully identified the person i was talking about. Job done.

This thread is of no further use to man or twits above. shan't bother with it anymore with all respect to the questioner.

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07th Jul 2008 16:30

hi ronald
does your surname indicate you are a cow, in which case this might explain your aversion to sheep. I could recomend you to a good farmer!

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07th Jul 2008 15:10

I don't know who is more dillusional..
Mike or Ronald!!

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07th Jul 2008 14:56

Ronald & Sheep
"the questioner" ... has he really asked a question? it reads more like a statement designed to provoke comment from professional accountants.

"the questioner" is unhelpful & rude in his comments trying to tar all UK accounants with the same brush!

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By Anonymous
07th Jul 2008 13:54

Mike I have never seen one of your postings before. I accept your points and agree the theory, but in practice outsourcing to India doesnt seem to work with practitioners I have spoken to, and from my own experience.

I contacted one of the major suppliers and to be honest I was astonded at the poor response time to answer questions, the general lack of interest and language difficulties.

Do you have some connection with an overseas outsourcer, or do you sucessfully use it - you seem very passionate about it.

When you have qualified people here in the UK who are preared to work for 1/3 or 1/4 of the fee I struggle to see how outsourcing out of the UK is worthwhile.

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07th Jul 2008 13:16

I would ban all these posters for being nasty to the questioner. They are unhelpful and rude. Seems to me like the usual sheep with one sweeping opinion again.

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07th Jul 2008 11:20

great idea
I am taking the rest of the day off. I have sent all my accounts work over to America by Fedex.
I have put a little note in to remind them to include some tax advice when they have finished preparing the accounts.

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07th Jul 2008 09:46

America??? Really?
When was the last time time you heard about American accountants being cheaper than UK accountants??? Or even offering outsourcing services for UK Comapnies??? They have little or no knowledge (onn the whole) of UK or International accounting conventions much less so of UK tax law ... So i really dont know where the poster gets his information from clearly isn't credible.

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07th Jul 2008 09:10

Mike's being ironic
Or he's had a really long lunch.

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06th Jul 2008 22:42

Welcome back Mike..

Nice to hear you're still banging that same drum.

You should really seek professional help, and not the accounting kind.

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By Anonymous
06th Jul 2008 16:56

Cloud Cuckoo Land

I appreciate your argument for outsourcing to India, and would say that if an Indian accountant could offer the same quality of service, and had the same technical expertise and tax knowledge as myself and many other UK practitioners, we would be quaking in our boots.

However, they are unlikely to know as much about UK tax as us because we find it difficult to keep up with the ever changing legislation as it is - and we live here and hear it on the news and in our sector magazines etc.

As for the comment about a cosy relationship with HMRC, it is far from it. We would never wish for our clients to pay the maximum amount of tax - we would (or should) be asking them to pay the minimum amount of tax by utlising legitimate tax avoidance and tax mitigation techniques. I envisage our Indian counterparts would be more inclined to tax evasion.

So in conclusion, let the Indian accountants prove their worth, and then the price war can begin.

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05th Jul 2008 16:52

Cosy you got to be joking
No chance at all me be cosy with the HMRC. I hate them and I will do anything within the law to reduce the tax liabitities of those who come to me advise. As for work being subcontracted to the India or elsewhere - forget it !. I have had endless problems with banks & creditcard companies who outsource their services and I generally end up by closing the accounts and moving my business elsewhere.

I certainly would not recommend any of my clients to outsource overseas. Think of the security implications for a start. Most client data contain sensitive information which could quite easy by sold on to (say) a competitor or a scam merchant by a underpaid subcontractor looking to top up their pay. Once the dtaa is sent to (say) India you loose control over it. Information is power, you give it away at your peril, especially if the HMRC is involved.

Most accountants do not like the HMRC because unlike the good old days you cannot now negotiate or even speak to Inspectors ( the only exception appears to be the Complex Tax sections - for a start there are no stupid call centres asking a lot useless time wasting ID questions)

Anyhow why subcontract work to India when there are plenty of people in the UK who will do it at a resonable cost. Not being thousands of miles away means you can go and see them, kick up hell and show them what the problem is when they do things wrong. And taking legal action in the UK is easy should you wish to do that.

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04th Jul 2008 23:55

the point you make with predictable regularity is as unsubstantiated now as it ever was. And didn't you know it is rude to shout.

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04th Jul 2008 22:27

What about service issues?
Outsourcing works well for some but it's been a disaster for clients of others.

Language difficulties can lead to bad misunderstandings. It is extremely hard to keep up-to-date with a tax regime when you're half way round the world, have no real interest and it's not written in plain English. I have never found talking to foreign accountants 'refreshing', quite the reverse, it's been hard work. But, as you say, where it works well there can be significant cost savings.

Whilst I agree that accountants may recommend that their clients do not take an aggressive, close to the wire, stance on certain matters, this is more likely to be based on their experience of the stress and costs on clients of dealing with enquiries, and not on taking a moral stance. It makes much better business sense for clients to spend their time and effort creating profit rather than dealing with questions from HMRC.

I too have heard accountants make comments about claims seeming immoral, especially where tax credits and the wealthy are concerned, but they risk PI claims if they do not put such claims to their clients.

I doubt any accountant has a 'cosy' relationship with HMRC in this day and age; it's impossible to speak to anyone in any authority any more and being able to speak to the same person twice is virtually impossible.

As for actively wanting clients to pay as much tax as possible or act primarily on behalf of HMRC, quite absurd, although I suspect many practitioners are guilty of not taking as much care as they should to identify tax saving opportunities, especially for jobs they have worked on for many years.

The proof will be in the pudding - if the overseas accountants are good and provide the desired service, they will attract the clients and deserve to do so.

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