In recent years business owners are under incredible pressure to trim costs of finance and accounting departments to boost productivity, increase profitability and assign strategic value to it. Accounting outsourcing is often looked as the source to achieve significant cost savings without compromising on the quality of work. One of the areas that businesses have turned to in order to cut costs is accounts payable. Studies show that accounts payable is the most widely outsourced finance and accounting function.
A company can outsource all or a part of its account payable business functions. Typically the functions which can be outsourced are:
– purchase order matching and entry
– accounts payable invoice entry
– accounts payable payment disbursement
– travel and expenses
– credit card processing
– check preparation
– vendor maintenance service
Accounts payable outsourcing services have several benefits:
– Up to 30% to 50% annual A/P processing cost savings without capital investment. The company usually gets the best service at a lowest cost from the service provider.
– Elimination of the headache of recruiting, hiring and managing clerical staff
– Need for continuous training of personnel is avoided
– Monthly, quarterly, half-yearly and annual reports are easily made available.
– High levels of efficiency and accuracy, Greater, centralized control over payables across the enterprise, despite of the actual physical location
– Documented systems
– Real-time tracking and reporting of all payables from the time they are received from the vendor
– The ability to focus on strategic, core business operations
However there may be numerous benefits to outsourcing accounting. But careful selection of service provider is important to make the process work as quality of services is the utmost factor. Take some time out and do a proper research about the companies offering accounts payable outsourcing to clients. Get an in depth analysis of the services offered by the firm before you actually decide to take up services from the company.
Accounts payable must always be handled properly and every account must be in place for you to make payments timely. Piling up accounts payable will only put you under a huge amount of strain. Accounts payable outsourcing may be a simple way for businesses to keep all the accounts in good shape.