Today’s business owners face great challenges in maintaining financial transparency and complying with government norms. Under such complex scenarios, it is advisable to switch to outsourcing services like auditing and accounting.
By outsourcing your accounting services to professionals in the field, business owners can fetch critical financial advice from them on various ways in which typical business pitfalls can be avoided, and the show goes on profitably. Moreover, they can train businesses to prevent fraud by making it ‘harder to steal and easier to uncover.’
Accounting outsourcing services can provide your company with a whole bunch of benefits like:
Accounting is one sector that is vulnerable to fraud due to its complex nature and risk evolvement. Outsourcing your accounting services and placing them into the hands of a reliable firm can provide accurate bank reconciliation statements, along with viable solutions for handling them accurately.
Keeping all your eggs in one basket is the biggest mistake that people make. The same applies with appointing one person to handle all your accounts jobs and depending completely on them. The first and foremost step towards bringing about internal fraud controls is to segregate duties relating to accounting, like authorization, record keeping, and asset custody. This can be carried out in a 2-people’s work strength also. Under such cases, the owner should handle the bank account responsibilities while a business manager should be assigned other duties like drafting emails, recording transactions, etc. As the numbers of employees grow, the business bookkeeping services should be distributed accordingly.
When transactions are accepted digitally, the risk of fraud and money laundering decreases to quite an extent. The primary reason for this is that there is no physical handling of cash involved. All the money coming in, or going out, is automatically registered and recorded in your bank account. Hence, bookkeeping fraud gets reduced to quite an extent through this simple practice.
When you outsource your accounting services, there is an automatic review of monthly reports, which helps outsmart fraud. Moreover, well-organized books, no messy under optimization of accounts, and proper authentication and verification of reports on a regular monthly basis can keep fraud at bay.
A forged, intercepted, or altered check on a business bank account is what is termed as check tampering. This can be controlled in many ways, one of them being outsourcing accounting services to separate the duties of bank reconciliation, date entries, etc. Other methods of preventing this fraud are by switching to electronic checks instead of a paper check, matching the payee of a cancelled check with your accounting software, and so on.
Skimming fraud is to swipe off something from the top, and it takes place where cash transactions are done regularly and money is received physically for most transactions. The person receiving it may skim some cash, put it aside in his pocket and report a lower amount received by deleting the entry completely. The best way to control this kind of bookkeeping fraud is to use electronic fund transfer methods.
This kind of fraud can be committed in two faces viz; one, an employee inflating the number of hours they have worked, and two, the employee issues fake payments to fictitious workers. The best way to curb this manipulation is to outsource payroll to an automated billing system. Your outsource accounting partner would offer a fraud detection tool to match the account number, check number, and amount.
Internal accounting frauds occur in businesses when two or more employees collude to defraud a business. When accounting operations are handed over to outsourcing agents, it closes doors to employee collusion and fraud. It segregates accounting duties, thereby minimizing the risk of fraud to a bare minimum.
When handed over and outsourced from outside the company, business bookkeeping services render various benefits, the topmost being restricting fraud practices and help in cutting down costs by up to 60%.
Moreover, it frees the business owner/CEO from just getting restricted to maintaining or building a scalable accounting department and monitoring it regularly. They can diversify and focus on various other primary roles that need better attention and expertise and can enable them to concentrate more on the core competencies of the business.
Hence, outsourcing your accounting services to a professional firm can be a win-win for a business/company in every aspect.
OHI is a specialized finance and accounting outsourcing service provider with over fifteen years of finance and accounting outsourcing experience. We have strong functional outsourcing expertise in end to end accounting processes covering daily accounting activities, reconciliations, month end and year-end account finalization processes, employee reimbursements, payroll processing, management reporting and financial analysis.
OHI serves close to 300+ clients across USA, UK and Canada. We invite you to experience finance and accounting outsourcing through us.
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