Outsourced Accounting Cost Is Generally Lower Than In-House Alternatives
Outsourced accounting costs are generally lower than the cost of having the accounting function operate in-house. The degree of savings will differ primarily based upon the components and the scope of specific responsibilities delegated to the outsourcing company and the complexity of the business needs.
Typically, companies that outsource their accounting functions generally save more money the larger they are, while smaller companies will save a higher percentage of their costs. The savings are generally anywhere between 30 and 75% of current costs.
Do Outsourced Accounting Costs Vary Depending on the Process?
This savings is realized whether a company is outsourcing one process, e.g., Accounts Payable, or the entire accounting function. Generally, the more a company outsources, the higher the savings because of the interdependency between different accounting processes.
In addition to using the average number of documents to be processed, accounts to be reconciled, and books to be closed monthly as drivers for the cost, business process outsourcing companies may also factor in the number and types of specialists required to meet the business accounting requirements.
How Do Accounting Outsourcing Companies Determine Your Costs?
The provision of an estimated fee for the outsourced accounting work is by no means always all-encompassing. Some outsourcers charge based upon the number of staff provided. Some charge extra fees for every call or email. While others provide an all-encompassing per transaction fee and/or monthly per entity fee. The actual fees will vary depending on each situation.
The outsourcing fees will not only change based on the scope and complexity of the work but could also vary based upon the capacity and experience of the outsourcing specialists available at hand. In addition, it will vary based upon the contractual and pricing arrangements made with the outsourcer.
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