General Ledger Accounting Software

Posts Tagged ‘Outsourcing’

Managing the accounts is a crucial aspect in any business. Even a single mistake can prove hazardous. The determination factor whether the company is enjoying profit or loss is possible only through the process of accounting. The success of the business depends on not only the vision of the entrepreneur but also each and every employee’s work done. Accuracy is the major aspect while dealing with journal or ledger entries or preparing balance sheet. A slight mistake can create a major confusion and disruption in the entire functioning of the business. One needs to ensure that the entire functioning is done in a proper manner.

The world has shrinked and has become a smaller place. Thus, the communication has become stronger across the globe. More and more companies are opting for accounting outsourcing services. The major benefit of accounting outsourcing services is that these are economical. They use much lower than what one otherwise has to pay to the in-house staff in the organization. The accounting division has the tremendous responsibility of maintaining the record of day to day basis and so it needs experts which accounting outsourcing provides. Outsourcing is an immensely powerful application present in the field of business development. Every profit oriented firm is seeking the assistance from outsourcing services in some way or the other. This concept not only adds on to the efficiency of the company but it also broadens the contours of the exposure of a company. To face the fastest growing competition in the market, more and more organizations are getting associated with these outsourcing companies.

Accounting outsourcing professionals use software through which the professionals can maintain the accounts in a proper manner. While choosing for accounting outsourcing services, one gets the assurance from the vendor about the accuracy of records being maintained by his team of professionals as well as guaranteed confidentiality about the financial records. The professionals handling one’s account would be well qualified for the job and competent in handling in any accounting software that one’s company prefers and is accustomed to.

Accounting outsourcing provides the advantage of having instant access to accurately maintained and updated accounts at any point of time. This comes into use when one needs to review the accounts at a glance during important decision making period or perhaps during the tax filing. It maintains to have the company’s financial records in perfect order and creates a favorable impression in the minds of the company auditors, your clients and customers, suppliers, investors, creditors and public in general. So considering the multiple benefits, it might be a feasible option to have accounting outsourcing work done by reliable professionals. The option of accounting outsourcing can be of good help. It ensures better quality of service because companies laying out the provision for outsourcing such accounting services concentrate thoroughly on the accounts related project given to them by the clients. Professionals take care of everything from invoice generation, creation of accounts, making financial statements to the management of accounts declaring profit and loss, processing pay roll, checking credit card accounts. Rapid growth is synonymous with accounting outsourcing.

Business Process outsourcing is driving a business transformation spanning all industry sectors and finance and accounting outsourcing is emerging as a dominant process in the recent years. Accounting outsourcing enables to protect core employer base and take advantage of specialized services. From recording transactions to financial reporting to control and risk management, it is no longer limited to transaction management but full fledged F&A process outsourcing.

Cost savings is the major driving force and goes from 50% to 60%, the industry has realized that F&A outsourcing is indeed about much more than pure cost savings. The other benefits are finance efficiency, process excellence, access to specialized team, 24/7 information access, control mechanisms are strengthened, and so on. Improved and organized accounting helps handle business growth and explore new avenues. The biggest value from outsourcing is increasing customer value, shareholder value and business value.

When it comes to handling your accounting function, its all about accuracy, confidentiality, faster turnaround, finance efficiency and cost savings. ExcellenceTech, accounting firm based in India manages the accounting outsourcing services by combining the extensive accounting knowledge and experience and state-of-the-art technologies.

ExcellenceTech caters to CPA firms and business enterprises and manages all the functions from transaction processing to reconciliation management, Accounts Payable and Accounts Receivable, general ledger accounting, cash flow analysis to full finance health flow analysis. Outsourcing solutions includes individual tax returns, corporate tax returns, Partnership tax returns, Fiduciary Tax returns.

The process flow is very simple and executed in a very secured environment as confidentiality of client’s information is very critical to the company and all the measures are in place from software/hardware firewall, 24/7 monitoring, strict access controls, limited use of internet and paperless environment.

General ledger excellence in an outsourced arrangement is challenging but achievable. Why?

The hand-offs between the client and provider are many and can be complex.

The provider is “once-removed” from the day-to-day local business issues and environment/culture.

Heterogeneous processing–the provider has many different accounting issues for many different customers.

Resources are leaner. Studies indicate that the providers’ full-time equivalents (FTE) process 30 percent more general ledger entries and reconciliations than in-house general ledger groups.

Relationships with the end-customer are typically newer and attaining a working trust level takes longer.

Clients can take steps, however, to mitigate the risks associated with the list above. However, we would suggest, at a minimum, the following four steps toward general ledger excellence in outsourcing:

Work Plan Each Month, Every Month: All good GL managers have a close checklist. Similarly, all good finance and accounting providers have them as well. The reality is that pre-close, close and post-close takes two weeks in a fairly well-run outsourcing GL shop. That leaves two weeks to get other work done. Most GL shops we have worked with use that window to breathe a sigh of relief, fix prior-month entries and gear up for the new monthly close. Instead, take four hours after every monthly close to pre-plan the new month with your provider. Leverage those 14 days to wisely allocate the scarce resource of time, with a daily plan mapped to each deliverable or objective.

Have the Provider Improve One Thing Every Month: All providers’ GL operations have room for improvement. Pick one thing every month and work with them to fix it. Here’s a quick list of items that are typical candidates:

Creating automatic data feeds for select balance sheet reconciliations to minimize manual and redundant data entry

Automating 10 manual journal entries every month

Designing and imbedding a process to start measuring one new “thing” that impacts service levels every month that has not been measured before

Reconciling the fixed asset ledger to identify candidates for write-offs

Identifying one enterprise resource planning (ERP) screen that is unused and could add process value, and then designing a process

Updating approval and routing tables

Identifying three bottlenecks in the close process and eliminating them

Insist that the Provider Learns Your Internal Customers’ Business: Once a quarter, ensure that the provider either spends a week in person with your clients or conducts a series of calls at a customer’s location learning their business and building trust. Work with your customers and the provider to build an agenda that will add value to them and execute against it. If your customer is a merchandising business, have the provider go to their site and work with them to streamline the inventory process. If the customer is a construction company, have the provider work to educate their project engineers on good capital management. The idea is for them to spend time at the site, add value and build trust. The key takeaway for the provider will be a better appreciation of the business and a longer list of allies out in the field.

Review Your Service Level Agreements Twice a Year: Your service level agreement with your provider is your guarantee of service, and your guarantee of their participation. As your service improves, so must their level and quality of participation (and vice versa). At least twice annually, dust of the agreements, compare service levels against historical performance, and work with the provider to set new standards for your organization and new expectations for the businesses. This option to reset service levels, however, must be built into the outsourcing contract. This will serve to improve performance, build a greater level of trust with the businesses and ensure that you stay on the leading edge in the marketplace.

Although these four steps will never be a replacement for a full-blown re-engineering effort, they are relatively low-cost, low-pain techniques for ensuring continued success with your processing and maintaining good relationships with your F&A provider.