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How to determine if outsourcing financial services is right for your business

You may be considering outsourcing financial services to fill in where important skills are lacking within your organisation. Keep in mind, you’re not alone if you’re struggling with the burdens, costs, risks and legal compliance issues that result from doing accounting in-house. Good financial services providers will improve your business by allowing you to work with the trained professionals you need, giving you the opportunity to cut costs, and helping to increase productivity throughout your organisation. Try assessing these areas of your business when deciding if it’s right for you.

Assess costs
Cutting costs may be one of the main reasons for deciding to outsource your financial services. Cost reductions may be driven through economies of scale and lower cost environments. Or, more indirectly, they could be as a result of transferring time-consuming and low value tasks out of the organisation into the hands of a capable service provider. This gives you more time to focus on strategic business objectives to increase revenue.

Assess your internal capabilities
You may look towards a financial services provider to provide skills that cannot be found within your company’s in-house staff. Outsourcing financial services may also help to address staffing issues and labour shortages. As is the case with cutting costs, outsourcing financial services should free up your staff to focus on higher value tasks.

Assess your technology solutions
Better software solutions can help to improve efficiency within your financial and accounting service processes. Financial service providers can give you access to superior technology without you having to foot the cost for these programs yourself. Think about your in-house software capabilities and how well they tackle your accounting needs, comparing it to what is available from the financial service provider you’re considering.

Service quality
Many SMEs do not have the core finance skills required to effectively run their businesses, so outsourcing can help to reduce the risks associated with ineffective in-house processes. These risks may be associated with the preparation of tax computation and other accounting procedures tied into legal imperatives.