You might also be interested in
Replies (17)
Please login or register to join the discussion.
My own view - which may not be popular -
Where possible, and if there is sufficient work, employ someone - then you have total control over quality etc.Otherwise outsource to a UK contractor. You then have legal safeguards not available when using overseas contractors.
In these times of high unemployment, and public debt, it is, in my opinion, unpatriotic to place work abroad. By doing so you leave someone in the UK unemployed, and, cost the taxpayer money in unneccesary benefits payments.
We should, whenever possible, buy British and employ British. Anything less is morally wrong and indefensible.
Outsourcing
I run The Payroll Department in Bristol a UK payroll bureau that has three firms of accountants as clients. One firm with nearly 100 payrolls particularly tells everybody the best days work he ever did. We do a professional job, which believe it or not means training and investing in staff and unless you have the volume is not cost effective particulary for a small practice. It also menns that the practicing accountant can do what they are good at, always the danger of being a jack of all trades and master of none.Our guys now make a profit out payroll, and so do we. I speak from experience having been a prracticing accountant before setting up this business. If anyone would like further information please contact me [email protected]
Outsourcing
My recent experience of outsourcing bookkeeping is that it is not as easy as some of us make it out to be. I found out that there are problem areas which are not mentioned when outsourcing is mentioned. The main problem areas are scanning of documents and related costs, outsourcing costs may be as much as doing the work in the UK if you add the time to sort out all the queries created by outsourcing companies when processing the documents.
I would be interested to hear from anyone who has managed to benefit from outsourcing bookkeeping.
A few tips
Personally, I think the following requirements should be considered when outsourcing (the list is not prioritised).
Confidentiality, with written agreement not to contact your clients direct - it is unlikely a subbie or outsourcer would steal your client as it would be professional suicide, but it could happen.Security of data and records - are they going to be kept securely, and if actual documents are taken are they insured if replacements are needed.Experience - are they limited to the easy tasks, or will they take on the more difficult, or messy, jobs?Availability - are they available throughout the year - will you get plenty of notice regarding planned holidays?Software - can they prepare accounts/tax in the required software?Bookkeeping - will they take client records in any format, eg. Manual records, Sage, Quickbooks, etc.Working papers - will they work to your templates so as to maintain consistency? Will they produce a good enough analysis for you to be able to check the accounts?How thorough are they - will they fully reconcile Wages, PAYE, VAT, Bank, etc.Will they examine the accounts to spot incorrect analysis of income/expenditure by your client.Will they perform a review of the accounts, summarise all the adjustments, list any errors or omissions, and highlight any concerns.Will they work to agreed timescales.If amendments are needed, will this incur an extra charge?Finally, will they do all this at reasonable cost?
Good Idea
I currently do all our audit work...and end up working too much says the Mrs.
I am going to outsource the lot, well I'll do the planning and sign it off and check it etc
Anyone want to run our auditing portfolio, I think Ill outsource it on an employer employee basis.
Good annual salary and working conditions etc, based at GU147LY
Ive got charities, residents associatioons, companies, international groups , its a mix and quite interesting. Anyone interested [email protected]
Thanks for the idea
Tom
Also
@Sparticus - gets my vote.
@ShirleyM - every one of your "will they" questions have to be turned into binding contractual terms with defined penalties in the SLA.
£0.02
Let's get back to the question.....
As a former Practitioner I had subcontractors and ShirleyM's checklist is thorough and complete.
This set up the model for my venture into subcontracting with the added understanding that the subbie will get the messier jobs. Earlier career in Practice says "Get on with it".
To my knowledge every box on ShirleyM's list can be well & truly ticked (no complaints ever heard)
I too had trepidation about subcontractors, but in time I realised how advantageous they can be. I base my operation on my expectations of subcontractors working for me.
BUT!! The OP question hasn't been answered- Why don't accountants outsource more (or even try it?)
PS I'm a UK based subcontractor.
What are we frightened of?
Mark,
I think the real debate is around "give and get". For it to work well in my experience, it has to be on a work exchange basis eg you do my bookkeeping work and I will do your accounts work with some monetary exchange for any difference in value of work done. If both providers are of a similar size, the relationship can work well.
IF our prime concern is the quality of service to our clients and the value we add to their business, we should be seeking to have their work done by experts, not enthusiastic amateurs. A good accountant should act as a signpost, helping clients access the skills they need to succeed in business.
If we don't refer, it's likely to be for two reasons. Either we do not trust someone else to do as good a job as we can, and this will be seen by our clients and reflect back on us, or we are afraid that they may like the new person more, maybe eventually leading to the loss of a client. Both of these have fear at their root, which is not a very positive thing.
Unfortunately I think we may miss a trick because we isolate ourselves from the opportunity to learn and share best practice. Ultimately this will backfire, when it comes to succession planning, as the skills have not been passed on.
On a very proactive note therefore, we are based in Southampton, and would welcome email form any local businesses that would like to explore whether we have opportunities to share share skills and work around. My email is [email protected] and you can read about us at www.davidpooleaccountants.co.uk.
Get the Right Guy
Frankly, the Indians are rubbish yet seemingly having cornered the market accountants can't think of anyone else who they could outsource to. My advice, as I have done, is to find an expatriate UK Chartered Accountant who just wants to do contract work and is clued up as to how to receive and deliver work. My guy, who is based in Israel, does work of the highest quality needing little if any in the way of checking or review. I will be happy to recommend him if anyone contacts me. [email protected]
Outsourcing
I believe that flexibility of staff will have a significant role in the future survival and profitability of British small business.
Outsourcing can encompass many disciplines from tele-marketing to the provision of specific professional services or basic admin.
No longer does this involve sourcing a provider overseas as there are now many qualified accountants offering services on a contract basis.
I myself provide professional service outsourcing remotely, due to regular international travel, often for an agreed %age of the fixed fee quoted to the end client.
Anyone interested please let me know - [email protected].
Outsourcing? Clean up input first (ABC)
Back in the hey days of the 1980s, I tried to arrange a discussion group with fellow local accountants. Too many of them answered "I'm busy, but if anything interesting comes up, do let me know". This was the opposite as to what I was trying to instigate. The group DID get formed, and we had some fruitful meetings.
That meant that WE got the chance to look at how we ran our practices. Too many High Street Accountants did not spend enough time in guiding new clients through the niceties of what records to keep. They told them "go to a High Street Stationers and buy an Accounts Book". If anyone was presented with blank pages, then they become intimated. As a result the Garbage In - Garbage Out syndrome prevailed.
To address that, I designed the ABC ACCOUNTS BOOK, and issued each client a free one. I still do this annually. As a result, great records come in, they are rapidly analysed, and the Financial Accounts are prepared swiftly, accurately, and very little enquiry from HM Revenue & Customs. The Book is readily available to other practitioners at £8 each. The publishers are Emandee Publishers, and they can be contacted via my Website: www.MartinLevinABC.co.uk
Outsourcing. Why? Simples.
As professionals offering services, the clients of course mutually engage your practice to do the job, (degree of skill and acumen and all that), and so not just subcontract it out. To tell them otherwise (worse still- not!) is probably not good for your credibility; and; generally not going to go down well. A bit of a spivvy money grabbing type concept then from professionals who are perceived as being paid well enough to do the job as it is.....but it seems as only the middle men, can't after all.
Yes, practicalities are issues.. Sensitive commercial and cultural considerations aside, what about any HMRC queries? Surely if you outsource you just risk having not got to know your client properly in the current regulatory climate ? Very superficial. If the outsourced 'accounts factory farm sweat shops' mass-producing these generic financials have no feel for the job, then what is the point or advantage? Other than getting A. O. Nother to sign of an audit that is. Then there's the shareholders. The local accounts staff put out of work etc by mostly cheaper overseas competition.In my opinion, outsourcing is also going further down the path to demeaning accountancy and audit as a profession. If you know your stuff anyway, then its not that hard to knock out a set of accounts nowadays. That's why outsourcers exist in the first place surely? The biggest threat or boom to the profession being software. Depending on your Luddite views of course. Outsourcing is perceived by the layperson as a cynical exploitation of technology, misleading clients and generally does away with client confidentiality. There is no real professional demand for it. We are not in the rag trade.
Outsourcing the unfamiliar...
I have spent 23 years in traditional practice and now 7 years as an independent consultant.
When I started operating independently I at first thought that smaller accountancy firms could benefit from my skills which include investigative work (such as due diligence), troubleshooting, and commercially orientated work such as business planning, process and information improvement through to outsourced FD services. I knew from my experience when in traditional practice, that not all accountants have those skills and usually when these one off projects arise they are (or were at the time) often difficult to resource. In addition it provides a flexible resource that could strengthen the offering of some practices and help cement their relationship with the client, without the fixed costs.
Whilst I do work with accountants, most of my work is direct to client. However, notwithstanding the benefits, I eventually came to the conclusion that I was often seen as a threat and I stopped actively marketing to accountancy firms. Also on reflection, accountants are generally conservative, so perhaps I was unrealistic to expect to be trusted straight off on complex non routine work (which would probably be on their larger clients!!).
I am however wondering whether views have changed and if attitudes have softened. Would you ever contemplate outsourcing this sort of work? Your views would be appreciated.
David Lewis
The answer to the question posed in the title of the article is - the ABH - Almighty Billable Hour. Unless and until the profession abandons the ABH it will be forever doomed to all that is contained in this article.
If you are interested in liberating yourself from the HMS Billable Hour visit - www.verasage.com. We have nothing to sell, we just want to help.
Outsourcing
I feel duty bound to mention the need to recognise services such as capital allowances claims on commercial property including furnished holiday lets. Many accountants do not understand that this work is not only worthwhile but will benefit some of their clients greatly. However it does need to be outsourced to a reputable to a reputable company.
Message ends.
I work with a firm that has wholly owned offices and staff in the UK and India. We have systematised all of the practice work from compliance right through to specialist client services so that every Partner, Manager and member of staff does the work they enjoy most and does best.
We do outsource some aspects of very specialist work.
We have been approached by older practitioners seeking phased retirement in a way that enables them
To retain contact with clients.To be freed from long hours doing work they are over qualified for.To focus on activities that they enjoy.To add value to their fee base which we will ultimatley buy at full market value.To offer clients fixed fees for routine work, thus eliminating dependence on time sheets.To reduce working capitalTo be freed from commonly experienced staffing difficulties.To continue to 'take home' at least their current share.To share all the benefits of a progressive dynamic practiceTo be able to backout fully at any time
We had thought of offering to 'outsource' compliance work for other practitioners but as many have experienced this is difficult to do successfully. We have already successfully achieved working relationships with a number of sole practitioners, which is more in the nature of a Practice Management Service which produces a true win/win result plus an improved service to clients.
If anyone wants more information on our working model please email me [email protected]