- Skyrocketing operational expenses are pushing accounting firms to seek alternative cost-saving measures.
- The global shortage of skilled accounting professionals is exacerbating staffing challenges for firms worldwide.
Challenges Faced by UK Accounting Firms:
Introduction to Outsourcing and Its Growing Popularity:
In response to these challenges, UK accounting firms are turning to outsourcing as a strategic solution to streamline their operations, optimize resource allocation, and enhance service delivery. Outsourcing, once viewed as a novel concept, has now become a prevalent practice among UK firms, reflecting a paradigm shift in the way accounting services are managed and delivered.
7 Reasons Why UK Accounting Firms Outsource to India
With the rapid development in the industry, more and more companies have emerged and are looking for a reliable accounting service provider. Outsourcing to India comes with a series of benefits that can positively help a company.
Some of the key reasons why UK accounting firms need to outsource to India include –
1. Cost Savings
Outsourcing accounting services to India offers UK firms a pathway to substantial operational cost reductions. Below is a comparison of labor costs between the UK and India, demonstrating the undeniable cost-effectiveness of outsourcing to Indian firms:
Aspect | UK | India |
Average Hourly Rate (in GBP) | £20 – £50 | £5 – £15 |
Monthly Salary (Entry-Level Accountant) | £2,500 – £4,000 | £300 – £700 |
Infrastructure Costs | High | Low |
Benefits and Taxes | High | Moderate |
As illustrated in the table, labor costs in India are substantially lower compared to the UK, resulting in significant cost savings for UK accounting firms. Additionally, the lower infrastructure costs and moderate benefits and taxes further contribute to the overall cost-effectiveness of outsourcing to Indian firms.
2. Access to Skilled Talent
India boasts a rich pool of highly skilled accounting professionals proficient in various accounting software and well-versed in international accounting standards. This abundance of talent presents a golden opportunity for UK accounting firms seeking to augment their capabilities and enhance service delivery.
Examples of skilled accounting professionals in India include:
Certified Public Accountants (CPAs): Many Indian accountants pursue internationally recognized certifications such as the CPA, demonstrating their expertise in accounting principles and standards accepted worldwide.
Proficiency in Accounting Software: Indian professionals are adept at utilizing a wide range of accounting software platforms, including QuickBooks, Xero, Sage, and SAP. Their familiarity with these tools enables seamless integration and efficient handling of accounting processes.
Experience with International Clients: Indian accounting firms often serve a diverse clientele spanning multiple countries and industries. This exposure equips professionals with the knowledge and experience to navigate complex accounting requirements and cultural nuances.
3. Time Zone Advantage
The time zone difference between the UK and India can be leveraged to ensure round-the-clock productivity, enabling UK firms to extend their working hours and accelerate project turnaround times.
Time Zone | UK Time (GMT) | India Time (IST) | Time Difference |
Standard Time | UTC+0 | UTC+5:30 | 5 hours 30 mins |
Daylight Saving Time | UTC+1 | UTC+5:30 | 4 hours 30 mins |
Illustration:
By outsourcing to India, UK firms can take advantage of the time zone difference to achieve round-the-clock productivity. For instance, when it is the end of the working day in the UK, it is morning in India. This allows tasks to be seamlessly handed over to the Indian team, ensuring that work continues overnight. Consequently, projects can progress rapidly, with tasks being completed during the UK night, enabling faster turnaround times and enhanced efficiency.
- Data Security Policies
When a business grows, one of the major concerns for the company is to maintain the security of the documents and accounts. By outsourcing to India, you can be assured that all your details, client information, documents, and other confidential data are kept safe and in secure databases.
5. Quality Assurance and Compliance
Accounting outsourcing companies in India adhere to stringent quality assurance measures and compliance standards to ensure the highest level of service delivery and regulatory compliance.
Aspect | Measures |
Quality Assurance | Implementation of ISO 9001:2015 quality management system to ensure standardized processes and continuous improvement. |
Compliance Standards | Adherence to International Financial Reporting Standards (IFRS) and Generally Accepted Accounting Principles (GAAP) to maintain accuracy and consistency in financial reporting. |
Data Security | Utilization of encryption techniques and secure data transmission protocols to safeguard sensitive financial information. |
Confidentiality | Implementation of non-disclosure agreements (NDAs) and restricted access protocols to protect client confidentiality and prevent unauthorized disclosure of information. |
Regulatory Requirements (e.g., GDPR) | Compliance with GDPR regulations regarding the handling and processing of personal data, including client information, to ensure data protection and privacy. |
Examples:
- ISO 9001 Certification: Many accounting outsourcing firms in India hold ISO 9001 certification, demonstrating their commitment to maintaining high-quality standards in service delivery. For example, XYZ Accounting Solutions Pvt. Ltd. has been awarded ISO 9001:2015 certification for its quality management system, ensuring consistent delivery of accurate and reliable accounting services.
- Data Security Measures: Leading outsourcing companies employ state-of-the-art cybersecurity measures to protect client data. For instance, ABC Financial Services implements end-to-end encryption and multi-factor authentication to prevent unauthorized access to sensitive financial information.
- GDPR Compliance: Accounting outsourcing firms prioritize GDPR compliance to protect client data and maintain regulatory compliance. For example, DEF Accounting Solutions ensures that its data processing practices adhere to GDPR requirements, including obtaining explicit consent from clients for data processing activities and implementing robust data protection measures.
- By adhering to stringent quality assurance measures and compliance standards, accounting outsourcing companies in India ensure the security, confidentiality, and regulatory compliance of client data, instilling confidence in UK firms outsourcing their accounting operations.
6. Access to the Latest Technologies
The market is rapidly changing with new and innovative accounting tools and technologies. Most of the tools and technologies are developed in India and by outsourcing here, you can get access to these updated and latest accounting and other financial tools and technologies
7. Focus on Core Competencies
Outsourcing non-core functions like accounting to India plays a crucial role in enabling UK firms to focus on their core competencies and strategic initiatives. By entrusting accounting tasks to specialized outsourcing partners, UK firms can unlock numerous benefits that facilitate business growth and enhance client satisfaction.
Examples of how outsourcing frees up internal resources to concentrate on business growth and client satisfaction:
Benefit of Outsourcing | Explanation |
Strategic Planning and Innovation | Outsourcing accounting functions allows UK firms to allocate more time and resources towards strategic planning and innovation. |
Client Relationship Management | Outsourcing accounting relieves UK firms from the burden of day-to-day financial tasks, enabling them to focus on building stronger client relationships. |
Business Expansion and Market Penetration | With accounting operations outsourced to India, UK firms can pursue expansion initiatives with greater agility and confidence. |
Resource Optimization and Cost Management | Outsourcing accounting to India not only frees up internal resources but also optimizes cost structures. |
Planning to outsource accounting services to India? Choose IPPC Group.
IPPC Group stands out as a premier accounting service provider for UK firms, headquartered in India. With over 50+ Years of industry experience, we have served clients across various geographies, industries, and sectors. Instead of managing your accounting needs in London or Manchester, entrust them to IPPC Group for cost-effective solutions.
Our team comprises highly skilled accountants and financial experts who leverage top-notch infrastructure and cutting-edge financial tools and technologies to deliver unparalleled results.
If you seek prompt, dependable, efficient, and budget-friendly accounting services in India, IPPC Group is your ultimate destination. Contact us today to get started.
