If you’re considering working with one of the many Accounts Payable outsourcing companies, you must weigh the advantages with the disadvantages to make sure it’s the most beneficial decision for your business. Encourage potential outsourcers to maintain a structured approach for a speedy resolution and a rigorous ticketing system with escalation procedures. It’s critical to have a solid ticketing system with escalation rules to guarantee that issues don’t go unnoticed. To guarantee that the work is of high quality, top providers will track a broader range of Accounts Payable key performance indicators (KPIs) like as many invoices processed per FTE. The best outsourcers are not only adept at the technical details of their sector but also able to identify and solve problems in the entire Accounts Payable lifecycle.

Third-party accounts payable outsourcing services will typically use their own AP automation software to achieve efficiency. If your current accounts payable process has considerable cash leaks or issues, moving to outsourced AP may improve budget optimization even after the cost of service fees. The average cost to process an invoice is as high as $15, and outsourcing or automation may offer up to a sixfold reduction in processing costs. Moreover, invoice processing speed is limited by your staff’s abilities and work hours.

If there are limited resources within your AP department, it becomes crucial to plan on how to scale the function to deal with greater volumes of invoices and data entry. According to a recent survey conducted by Intuit (the makers of QuickBooks), 89% of small business owners say that they experience more success when they are working with a good accountant. There are several paths you can take, and it is important to choose the right one. Of course you can hire a dedicated, full-time accountant, but this is an expensive option that often doesn’t yield the results businesses are looking for. Separate AP departments may not have knowledge of sudden system changes, such as vendor transaction updates, which can result in future errors or duplications. And when it’s time for you to go back and audit the trail of documents, you may have limited access to find where something went wrong.

Lower errors and better fraud mitigation

Firstly, you can concentrate on other important functions when you have the assurance of an expert team handling your finances. Secondly, you’ll have at your disposal the financial acumen needed to minimize red flags and make progressive decisions. However, as a CEO or CFO, you have to consider several factors before deciding on outsourcing your financial and accounting operations. Outsource Accelerator is the leading Business Process Outsourcing (BPO) marketplace globally. We are the trusted, independent resource for businesses of all sizes to explore, initiate, and embed outsourcing into their operations. Keen attention to detail and robust knowledge for managing donations, funding, auditing, and financial reporting obligations are crucial.

Set up touchless AP workflows and streamline the Accounts Payable process in seconds.
There are significant advantages for clients who decide to outsource starting with cost-efficiency.
However, with outsourced accounting, you work with providers usually equipped with cloud-based systems and automation capabilities that offer uninterrupted services.
Skilled outsourcing providers can make a company’s AP processes more efficient; thus improving the cash flow.
These references are from various CPAs and accounting firms that have successfully outsourced their accounting functions.

In recent years, nearshore outsourcing to Mexico has emerged as a vital strategy for U.S. Highly skilled and experienced in US tax legislation and accounting standards, our qualified accounting professionals work on the latest accounting software to deliver service excellence. Whether you are a startup accountant or a single partner firm, QXAS helps free your time to focus on growing your firm. To streamline your AP processes, your data submission systems will need to be updated.

major benefits of accounting outsourcing (+ useful tips)

Benchmarking firms often evaluate businesses in terms of Top Performer (75th percentile or above), Median Performer (50th percentile), and Bottom Performer (25th percentile and below). Knowing where you fall validates the business case for AP outsourcing by revealing the return on investment that may be expected if you move from one performance level to another. In that case, in-house staff might be able to focus on other core activities such as budgeting, analysis, decision-making improvement, and vendor management. Many business owners are dealing with one (or more) of the following problems when they consider outsourcing their accounts payable operations.

Get Inside Outsourcing

Storing vendor information, invoices, and receipts in a filing cabinet makes it difficult to predict financial issues or recognize opportunities accurately. In this case, companies are adopting accounts payable automation and in-house processes to get a handle on AP, and it’s an effective solution. While accounts payable outsourcing is a viable option for some organizations, many can get the benefits of outsourcing while maintaining higher efficiency and security using a procurement platform. Some companies find that the cost of outsourcing is offset by the overhead savings created by delegating certain processes to an external provider. Conduct a cost analysis to determine if outsourcing your AP processes could improve efficiency and reduce operational costs.

Daniel E. Greene, CPA Firm Achieves $99,000 Cost Savings with QXAS Outsourcing

In the following, we will discuss the pros and cons of outsourcing accounts payable services compared to having an in-house accounts payable team, AP automation, and the shared services center. As companies increasingly recognize the benefits of outsourcing accounts payable (AP) functions, those who choose not to embrace this strategic approach may encounter future challenges. With the technology offered by an accounts payable outsourcing provider, businesses can seize the opportunity to eliminate paper-based processes and significantly reduce manual tasks, such as data entry. One of the advantages of outsourcing is that you have flexibility to get the services you need without having to pay for those you don’t. Typically, an outsourced services provider will start with an assessment to determine what you need and how best to help you reach your goals. From there, they will provide a proposal that outlines the services they can provide and the related costs.

If your AP department is spending more than expected on payment processing, it’s time to look under the hood. CFOs typically don’t invest in AP outsourcing long lived assets definition because they think it will be costly. While it is easy to supervise an in-house AP team, the same cannot be said for third-party service providers.

But as your business grows, especially if you experience a period of rapid growth, so will the number of administrative tasks that you need to handle on a day-to-day basis. So when the invoices stack up, it’s time to take a moment and create a game plan to scale your Accounts Payable department in the best way for your business. However, organizations must go beyond the lowest-cost option to ensure that their partner provides significant cost savings while boosting productivity and performance. Accounts payable automation software, which may be used in-house, is a SaaS add-on to your ERP or accounting system that automates back-office payables processes and international mass payments procedures. Many organizations choose to outsource accounts payable activities to avoid dealing with complicated legal obligations. Delegating these responsibilities to an Accounts Payable outsourcing firm allows a company to focus on other pressing issues while still giving the work a professional touch.