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Finance and Accounting Outsourcing India
In today’s economic pressures and competitive demands
companies are required to more aggressively evaluate options
to reduce costs and increase value from their back office
functions. To stay competitive and specially during the economic
recession business executives have to aggressively pursue
cost savings and productivity enhancement options and stay
ahead. The pressure of the current market forces and the price
wars have seen many companies to reduce cost by outsourcing
its non-core activities to low wage service providers. A cost
cut of any manner can change the company's position in the
market. Companies with low cost leadership are able to gain
the potential market share. Business process outsourcing as
a strategic tool has been accepted as one of the most effective
means to achieve these twin goals. Most companies now
consider finance and Accounting
Outsourcing as an important part of their
outsourcing strategy.
Accounting Outsourcing and other back office activities allows firms to focus on the activities they do best and improve their overall performance and, transferring the responsibilities of accounting activities to specialized vendors can help reduce the cost and improve the performance of such activities. Accounting Outsourcing is generally considered as a very powerful tool to cut costs and improve performance. The principal idea behind accounting outsourcing is to obtain services of specialist who will perform the function better at a lower cost.
Accounting Outsourcing and India
A large number of companies are outsourcing their accounting functions to India. Fortune 500 companies such as: GE, Bank of America and American Express for example have formed partnerships with Indian firms. A recent survey found that almost two out of five Fortune 500 companies currently outsource some of their back office requirements to India. The reason for this according to most research is that it saves time, money, and better work ethics; thus, India is ahead of competitors such as China. There are many reasons for India getting the Lion share of outsourcing. Cost is the chief reason for sending business to India. But the country's abundant manpower has made India a target destination for companies to back end their operations in India.
Other reasons for companies outsourcing to India are:
- Labor Pool - graduating 75,000 English speaking accounting professionals annually
- Cost advantage - US - $2500 a month versus India - $800-$1000
- Time difference - 10 hour time difference allows 24-hour service
- Thus because of its labor pool, lower cost, friendly government policies, infrastructure investment, and expertise, India is on a fast track to become a developed country.
Conclusion
Hence, hiring Outsourced
Accounting firm is a good idea, as it not
only provides effective work but also decreases the burden on
the person dealing with the accounts and can focus on high end
activities like consulting and tax advisory services. In fact,
many small and large companies have visualized the importance
and need of Outsourcing
Accounting as it cuts down the money and
time, both simultaneously. Outsourcing accounting has become
a vital part of various companies for profitable reasons. With
the help of outsourced accounting, business owner will be able
to get a clearer picture of his business in the terms of profits
and losses. Moreover, he will be able to have details on the
position of business in the market. |
