In today’s increasingly globalised accounting sector, outsourcing has become a key strategy for Australian firms to streamline their operations and maximize efficiency.
Among the popular outsourcing destinations, the Philippines has emerged as a hub for accounting outsourced services. However, choosing a reputable outsourcing partner is a critical decision that demands careful consideration.
Here are my Top Eight “best practice” strategies for accountants when selecting a reliable outsourcing partner in the Philippines.
1. Assess Existing Accounting Experience:
One of the foremost factors to consider is the outsourcing partner’s expertise and experience in accounting and accounting-related services, ideally in Australia. Look for partners with a proven track record in providing accounting solutions to accounting firms. Evaluate their experience, client testimonials, and case studies to gain insights into their capabilities and approach.
2. Check the Quality of Talent and Workforce:
The quality of talent is the cornerstone of any successful outsourcing engagement. Investigate the provider’s recruitment and training processes inside the Philippines. Consider their commitment to ongoing training, professional development, and certifications for their staff. Like Australian accountants, Filipinos are looking for career development and opportunity. A motivated, well-trained, and knowledgeable offshore workforce ensures quality in the team, less rework and longevity of employment.
3. Look into the Provider’s Technological Capabilities:
In the digital age, technology plays a pivotal role in accounting processes. Ensure your prospective outsourcing partner employs up-to-date accounting software, security protocols, and data protection measures. Inquire about their approach to data security, disaster recovery, and business continuity planning. The outsourcing provider should be committed to the information security standards established in ISO27001.
4. Consider Scalability and Flexibility:
The business needs of Australian accounting firms change quickly. We have seen this with the talent shortage that has emerged during and since the pandemic. Your accounting outsourcing partner should be well-equipped and adaptable. Choose a partner with a scalable model that can accommodate the fluctuating demands of growth and contraction. Flexibility in terms of the service offerings and engagement model is essential to align with your specific needs.
5. Observe Cultural Compatibility and Communication Standards:
Effective communication is paramount in any outsourcing relationship, and especially in professional services firms. Assess the outsourcing partner’s ability to provide staff with high levels of English proficiency. This should be expected in the Philippines. Also, consider cultural compatibility and time zone alignment to ensure smooth collaboration and accessibility.
6. Review Regulatory Compliance and Ethics:
Compliance with international accounting standards and regulations is non-negotiable. A provider’s commitment to compliance and ethics comes from their background and their experience Thoroughly evaluate the outsourcing partner’s commitment to the Accounting Professional and Ethical Standards Board and compliance with other industry standards. A good place to start will be the provider’s understanding and adherence to APES GN 30 “Outsourced Services”.
7. Check Client References and Reputation:
Request client references to gain insights into the outsourcing provider’s performance, reliability, and responsiveness. Online reviews, testimonials, and personal references from other clients are all indicative of the partner’s reputation and standing in the market.
8. Consider Cost-effectiveness vs. Value:
While cost is a significant consideration, focus on value rather than just the lowest price. A BPO partner that offers a balance between quality services and competitive pricing will be more beneficial to the accounting firm in the long run.
Richard Croaker is an Australian Chartered Accountant who has developed a professional team of accountants, bookkeepers, financial planning staff and finance broking staff in the Philippines. The company operates in Clark, Pampanga with around 100 staff, many of whom are graduates from top-level universities in the Philippines and are licensed members of the Philippines Institute of CPAs. His Philippines firm services Australian companies exclusively. With more than 30 years’ experience in professional practice working with Australia’s largest accounting firms, he has been the Founder and Chief Executive of the international business of Profitmaster Global Outsourcing for the past 9 years.