“People will try to tell you that all the great opportunities have been snapped up. In reality, the world changes every second, blowing new opportunities in all directions, including yours.” — Ken Hakuta
True enough. As the world progresses, you can always find new chances to grow. One great way to make the most out of these opportunities is to look into finance and accounting (F&A) outsourcing.
In this article, we will look at the value of accounting outsourcing to Australian firms.
Related: A Comprehensive Guide to Accounting Outsourcing Services
Here’s what we’ll cover:
1. What is Finance and Accounting Outsourcing
2. How Are Australian Companies Outsourcing Their Work
3. How Outsourcing Supports Long-Term Transformation
4. How to Effectively Outsource Accounting Services
5. Why is the Philippines an Ideal Country to Outsource Your Needs?
6. How Much Does It Cost to Outsource in the Philippines?
What is Finance and Accounting Outsourcing?
Finance and accounting outsourcing involves hiring a third-party provider that offers F&A services, including bookkeeping, payroll processing and tax preparation.
These specialised companies can support you and take care of back-office tasks that may be too time-consuming for your in-house accountants.
How Are Australian Companies Outsourcing Their Work?
Around 80% of Australian companies outsource and mostly use offshore resources in their company practices.
According to the Australian Bureau of Statistics (ABS), outsourcing—particularly in legal, accounting, and other professional services—has contributed significantly to the growth of the professional, scientific, and technical services sector.
In fact, this sector accounted for a notable share of employment and economic activity (10.7 percentage points), as revealed in the same report from ABS.
Given these statistics, Australian companies are clearly seeing the benefits of outsourcing and are taking advantage of this opportunity to stay ahead in the competition.
How Outsourcing Supports Long-Term Transformation?
Outsourcing offers numerous advantages that support a business’s long-term transformation and growth. Below are some of its benefits:
1. Scale and Adjust Your Accounting Needs Easily
One of the biggest advantages of outsourcing is that it allows you to scale your accounting function. When you outsource, you can adjust the headcount of your outsourced team without having to worry about hiring and training new employees.
This means that if your organisation grows, you can let your service provider know that you need more accountants to handle the increased workload. And if it slows down, you can reduce the number of accountants working on your books without having to lay anyone off.
2. Access to Advanced Technology and Automation
When you outsource your accounting, you get access to the latest accounting software and technology. This means that your books will be more accurate and up to date.
You can also use these tools to make sure that you process invoices faster, generate financial reports more quickly, and even provide real-time data on how your business is performing.
Most specialised accounting outsourcing companies are composed of professional accountants who are experts in their field, so they can help you find the right technology and automation tools for your business. They can also show you how to use them effectively so that you get the most out of your investment.
3. Access to Specialized Experts
One key benefit of outsourcing is gaining access to a highly skilled talent pool. This is particularly valuable when dealing with tasks or projects that require specialised expertise.
For instance, if your company needs assistance with tax preparation, outsourcing to a professional in that field can ensure accuracy and efficiency.
4. Save on Overhead Cost
Outsourcing can also offer significant cost savings by reducing your company’s expenses. By hiring an outside firm, you don’t have to worry about paying for benefits or other overhead costs associated with hiring full-time employees.
Instead, you pay only for the services provided by the outsourced company. This can help you save money and free up resources that would otherwise be spent on salaries and benefits.
5. Regain Work-Life Balance
The workload of in-house accountants likely involves managing financial reports, ensuring compliance, and supporting key business decisions—all while juggling daily operational tasks. These responsibilities can be overwhelming, especially when you are also trying to manage family life or personal commitments.
However, outsourcing some of your accounting tasks to a trusted provider can reclaim your time to concentrate on higher priority areas. This strategic approach not only helps you attain a more balanced work-life routine but also lowers your stress levels—both of which are essential for maintaining your overall productivity and well-being.
How to Effectively Outsource Accounting Services
Understanding the ins and outs of outsourcing accounting services is essential to ensure they work to your advantage. Here are some key pointers to increasing outsourcing success.
a. When should you consider outsourcing your accounting services?
The answer to this question depends on your specific needs. However, if you’re looking for some signs that it may be time to outsource accounting services, here are a few things to consider:
1. Cash Flow Management is Becoming a Struggle.
One sign that you should consider outsourcing is when cash flow management becomes a struggle. Late payments, inconsistent invoicing, and collection issues can severely impact your cash flow.
If managing accounts receivable and payable is overwhelming, an outsourced accounting team can streamline billing, payment follow-ups, and expense tracking—helping you maintain a healthy cash flow.
2. Your Financial Records Are Disorganized
Despite your best efforts, the increasing demands of running your organisation may prevent you from keeping your financial records in order.
Disorganisation can take many forms—records that are outdated, incomplete, or scattered across different systems, or multiple people managing them without clear coordination.
Plus, disorganised and outdated records can lead to serious issues and costly mistakes, including:
- Inefficient accounting processes
- Lack of clarity on your company’s financial health
- Difficulty securing investors or lenders
- Challenges in applying for government grants
Outsourcing your accounting can help prevent these problems. Accounting professionals from the outsourced provider ensure that your financial records are consistently updated, reconciled, and accurate, helping you avoid costly mistakes in the long run.
3. You Need to Prioritize Your Core Business
A survey by DataRails noted that 81% of CFOs believe that they endure the heaviest workload among C-suite roles.
This means they are expected to handle many different tasks and go beyond traditional financial management, which means instead of handling multiple roles—such as accounting, marketing, and administration—you should focus on higher-level business strategies.
Attempting to do everything yourself increases the risk of burnout and diverts your attention from activities that drive business growth.
To scale successfully, you must learn to delegate responsibilities to qualified professionals. Running an organisation requires balance and knowing which tasks to offload can make all the difference.
4. Your Internal Accounting Team Need Extra Support
Another clear indicator that outsourcing may be necessary is when your in-house accountants struggle to keep up with their workload. This often happens during periods of growth or peak business seasons.
Rather than expanding your in-house team and taking on additional overhead costs, outsourcing back-office accounting support offers a cost-effective and efficient solution to this problem.
b. What to look for in an Outsourcing Provider?
After knowing the signs, the next step is to find the appropriate partner to deliver those services. Below are the things you should consider:
1. Good Reputation in the Industry
The first thing to look for is a company that has experience in the industry you are in. This will ensure that they have the right knowledge and skills to deliver on your needs.
2. Track Record of Success or Testimonial
Another thing to look for is a company that has a track record of success with other clients. This will give you confidence that they can deliver what they promise and that their services will be of high quality.
3. Approach to Work
Check if a provider’s approach to work aligns and matches with your own organization. If you are looking for someone who will take care of everything from start to finish, then make sure they have experience in this area.
If you want more control over the process and want someone who will work closely with you throughout the project, then look for a company that offers this type of service.
4. Flexible Price Points
Look for a provider that offers flexible pricing options so you can choose which one best fits your budget.
5. Communication style
Lastly, check their process to see how they communicate with their clients. Do they have a dedicated project manager who will be your main point of contact? Or do they use an online portal where you can log in and see the status of your project at any time?
The more information you can get about how the organization communicates, the better off you will be in the long run.
c. Discuss Your Requirements and Establish a Service Level Agreement (SLA)
Once you have selected an outsourcing partner, it’s critical to discuss your needs, expectations, and other essential business aspects related to the outsourcing process.
These discussions help identify key deliverables, performance metrics, and responsibilities, which will then be formalized in a Service Level Agreement (SLA).
An SLA is a formal document that outlines the services to be provided by the outsourcing partner, as well as the agreed-upon standards for those services. It should include sections like:
- The scope of work to be performed by the outsourcing partner.
- The quality standards for that work.
- How often you will meet with your outsourcing partner and what will happen if they don’t meet their obligations.
d. Start the Outsourcing Engagement and Evaluate the Progress
Once everything is ready, then make sure to expect that like any relationship, the initial phase of the outsourcing engagement will involve adjustments and improvements.
Hence, make sure to have regular meetings and feedback sessions with your point person or the account manager to identify areas that need refinement.
If there is a need to adjust timelines, processes, or the SLA itself, do not hesitate to discuss these changes with the provider. Always remember that building a productive working relationship requires effort from both parties.
Why is the Philippines an Ideal Country to Outsource Your Needs?
The Philippines is a great place to outsource because of its low cost of living and large English-speaking population. In a recent English proficiency survey conducted by the Swiss firm EF Education First (EF), the Philippines ranked 22nd out of 116 countries with a score of 570, indicating a high level of proficiency in the English language.
This makes it easy for Australian companies to communicate with their offshore staff, which in turn makes it easier for them to get work done quickly and efficiently.
Read Next: 5 Major Benefits of Outsourcing to the Philippines
How much does it cost to outsource in the Philippines?
Outsourcing to countries like the Philippines can result in substantial cost savings due to lower labor expenses compared to Western countries. This economic advantage allows businesses to preserve quality while significantly cutting costs.
The cost associated with outsourcing accounting services in the Philippines can vary based on different factors, such as:
1. Labor Costs
A clear comparison can be made between the salary prospects of accountants in Western regions and those in the Philippines.
According to the latest statistics from Indeed, accountants in Australia earn an average annual salary of AU$77, 969, equating to roughly about AU$6,497.42 per month, in contrast, Filipino accountants working full-time have an average yearly income of AU$9,459.86, which break down to about AU$788.32 monthly.
Aside from considering the data that was given, it’s also wise for your firm to perform a cost-benefit analysis. This analysis will help determine whether outsourcing would be financially effective, considering projected costs, benefits, or opportunities.
Note: These figures are based on conversion rates. Initially, the average accountant salary in the Philippines is set at PHP 345,001 per year. As of February 11, 2025, the exchange rate of the Australian dollar is 1 AUD to 36.47 PHP.
2. Number of Full-Time Equivalents (FTEs)
The number of required FTEs also influences the overall expenses, as it varies based on the workload and the complexity of the outsourced tasks.
Hence, make sure to assess your workload to help you determine how many FTEs are essential for effectively meeting your demands.
3. Contract Length
The contract duration also has a role in determining the cost. For example, longer contracts might offer more favorable rates than shorter ones.
Given this, it is also wise to assess your accounting outsourcing requirement and select a contract duration that aligns well with what you require.
Note: This information is intended as a guide. For precise details on pricing structures and fees, it’s advisable to speak with business development officers from potential outsourcing firms directly.
The Bottom Line
Finance and accounting outsourcing companies gives every Australian firm a way to cut costs, get expert help, and free up time to focus on growth. As we move into 2025 and beyond, businesses that use outsourcing wisely will be in a stronger position to succeed.
Team Up with D&V Philippines’ Accountants
Thinking about building a CFO support team to help with your growing accounting tasks? Consider partnering with D&V Philippines for outsourced CFO support services.
With over a decade of experience in offering comprehensive finance and serving clients all around the globe, we pride ourselves on delivering quality accounting solutions. Schedule a free consultation with us today to find out more about how we can help you.
You can also read testimonials from our clients and download our Premium CFO Solutions whitepaper to see if we’re the service provider you’re looking for.
