You’ll never run out of options when you’re looking for finance and accounting outsourcing companies in the Philippines. But out of hundreds of service providers in the country, how do you choose the one that can deliver quality service at a reasonable cost?
Why outsource to the Philippines?
The Philippines remains to be a popular outsourcing destination for finance and accounting services — and for good reasons.
The latest data from the Professional Regulatory Board of Accountancy revealed that there are around 200,000 registered certified public accountants (CPA)* in the country. These figures, which are the highest in Southeast Asia, can be good news for companies affected by the talent shortage.
Read: A Look Through Southeast Asia’s Accounting Outsourcing Industry
But more than the quantity, the Philippines prides itself with the quality of its accountants.
Beginning from tertiary education, Filipino accountants have been trained to deal with complex finance and accounting concepts. The curriculum of most higher education institutions (HEIs), which are hinged on global accounting standards (e.g., IFRS and GAAP), is also designed to filter the best of the best.
Communicating with these finance and accounting professionals will rarely be an issue for English-speaking clients, thanks to the country’s high English proficiency.
On top of this, young Filipino accountants are starting to see the outsourcing industry as a feasible employment option. As opposed to the cutthroat culture of the Big 4 accounting firms, modern outsourcing companies offer more competitive salary packages and promise better work-life balance.
The Philippine government has also been supportive of its outsourcing industry. Aside from improving its infrastructure, BPO companies can receive tax incentives, which is one of the key factors for keeping services at reasonable prices.
However, not all Philippine outsourcing companies are created equal. Some may have a proven track record but aren’t culturally aligned with your company. Others may also excel at providing a specific service in your time zone (e.g., call center) but don’t have the necessary expertise to work on a different function (e.g., accounting).
Preparing a checklist of what you expect from an outsourced accounting team can bring you closer to the right service provider. As a start, we listed some of the elements you must check to see if an outsourcing company has what it takes to deliver quality finance and accounting services.
What to look for in a finance and accounting outsourcing company in the Philippines
Succeeding in outsourcing isn’t about working with the best company in the industry nor is it about choosing the provider with the most expensive service or extravagant presentation. Compatibility matters most, be it in terms of your culture, quality standards, and budget, among others.
If you choose to outsource to the Philippines, make sure to check the following:
1. Professional competence of their accounting talents
Service-based industries are heavily reliant on the capabilities of their people. The finance and accounting sector, being a part of it, needs qualified and competent accountants to function well. And so does your business.
That’s why if you’re filtering potential service providers, one of the first few things you must look into is their ability to attract, nurture, and retain competent accounting professionals.
Specifically, here’s what you can check with your shortlisted Philippine outsourcing companies during discovery calls:
- Recruitment capabilities. Ask them about their timeline for hiring accountants, especially when you’re looking for talents with high-level, technical, or specialized skills.
- Learning and development programs. See if your shortlisted outsourcing companies offer learning and development programs for their employees. Regulatory changes and technological advancements happen almost every year, so accountants must also keep their skills and knowledge updated to provide you with the best service possible.
- Proactive recruitment marketing efforts. You can also check their efforts in attracting qualified accounting professionals. Do they have a strong online presence? Are they proactive in building partnerships with renowned educational institutions and professional accounting organizations? How do they position themselves as an employer of choice?
- Career progression plans. See if there’s a clear progression plan for their employees and an objective system for measuring performance. These elements are important in keeping employees motivated to bring their best to work.
- Retention rate. If you’re planning to work with outsourced accountants over a long period, choose an outsourcing firm with a high retention rate so you’ll have an easier time building a stable outsourced team.
To cut it short, a service provider that invests in finding top accounting talents and supports the growth of its people deserves a place on your list.
2. Efficiency of service delivery process
Observe and analyze each service provider’s approach to doing business. The key is to get a ‘feel’ of how responsive and professional they are when dealing with you. In this case, first impression matters, given that you’re working on a long list of BPO service providers.
You can look for both subtle and obvious clues when assessing if a provider has efficient processes. For instance:
- How fast did they respond when you first messaged them about the services you’re looking for?
- Do they have a professional way of presenting their services?
- Based on their presentation, how does their internal processes look like (e.g., onboarding, account setup, employee management, customer service)?
- How do they handle your inquiries and objections?
- Do they act quickly when you’re requesting relevant proof or documents to back-up their claims about their services (e.g., case studies, testimonials)?
- Are their sales representatives easy to talk to?
The sales process of an outsourcing company gives you a glimpse of how their overall internal processes look like. If it’s streamlined and organized, chances are high that their daily operations also look the same way. If it’s the contrary, then you may consider crossing them out of the list.
Related: Mitigating Operational Risks through a Proactive Service Delivery Process
3. Access to various accounting tools
You must also look into an outsourcing company’s accounting tech stack, or a collection of tools used to complete different accounting tasks.
Check with them if they’re using the same set of tools you’re using. You can also ask them what other tools are available in-house, be it for accounting tasks, project management, documents management, or business intelligence.
Aside from their tech stack, inquire about how they helped their clients in streamlining their processes as well. If you’re lucky, you can stumble upon specialized outsourcing companies that can help you improve your current workflows and prepare standard operating procedure (SOP) documents. This can be especially helpful if your accounting processes are in disarray or if you have several subsidiaries or office/store locations.
4. Services and solutions offered
There are two things you must keep in mind when listing down potential providers:
- All accounting outsourcing companies are part of the BPO industry, but not all BPO companies offer accounting and financial services.
- Outsourcing companies that offer accounting and financial services have different specializations.
This goes to say that when listing down potential service providers, you must always check the specific services and solutions they offer. You can either visit their website or contact them directly to confirm if they’re offering the service you need.
Another thing is to check the scalability of their services. Can they adjust the size of your offshore team when needed? Are they capable of handling bouts of recruitment needs?
5. Corporate culture
Corporate culture affects employee performance, and employee performance embodies the quality of service you receive.
With this in mind, you must choose an outsourcing company with an outstanding corporate culture.
Doing on-site visits is the ideal way to learn more about their culture and observe their work atmosphere. But since the Philippines can be a bit far, researching online would be enough.
You can start by reading actual employee reviews in popular job sites in the Philippines such as Glassdoor, Indeed, Jobstreet, and Kalibrr. Other than learning employees’ satisfaction level, it also gives you an idea about their compensation packages, management style, and work environment. On top of this, we also recommend visiting the company’s social media accounts to learn about the activities they do for their employees.
6. Data security measures and IT processes
There should be no compromise when it comes to the security of your business data. That’s why when selecting a service provider, you must review the following through a thorough due diligence process:
- Data security policies
- Payment processing and payroll systems
- Confidentiality agreements
Ask them about their efforts in keeping their employees informed of best data security practices. Find out as well if they’re using reliable cybersecurity tools such as firewalls, antivirus, encryptions, and end-point security tools, to name a few.
Try to understand their IT processes as well, especially the role of their IT Department in setting up accounts and resolving day-to-day technical problems. If possible, get your internal IT specialist involved in the process so you can be assured of the provider’s capacity to keep your data secure.
7. Compliance with relevant laws and regulations
See if the outsourcing company adheres to all relevant local and international laws.
In the Philippines, for instance, there’s the Data Privacy Act that holds organizations accountable for the personal data they process and the Labor Code to govern employment practices and labor relations.
You can also check if they’re knowledgeable of the accounting standards and business regulations that apply to your company.
8. Pricing structures
If you aim to reduce costs, then you must be familiar with different types of outsourcing pricing structures.
The fixed pricing (FP) model is the most common among outsourcing companies wherein they set a standard amount for their services. The standard fee varies depending on labor costs, the total number of hours, headcount, add-on services, and complexity of services outsourced, among others. There’s also the time and materials (T&M) model, shared risk reward model, and incentive-based pricing model.
Make sure to always prioritize value at all times. Don’t just settle for providers with suspiciously low pricing. Always take precautions when reviewing their prices to ensure that there are no hidden costs, and you won’t incur unexpected charges along the way. Remember, outsourcing high-quality services from the get-go can be more cost-effective in the long run.
9. Quality of customer service
When you outsource, it’s unavoidable to experience misunderstandings or disappointments along the way. The quality of customer service they render during those crucial moments can tell you if you selected the right service provider.
That’s why before unforeseen incidents happen, you must take some time to evaluate their customer service. Observe how they deal with your queries even if you’re still not their client.
If you know businesses that have already worked with them, ask them about their experience, especially with how the provider dealt with their concerns. Reading client reviews from third-party websites can also help.
Read Next: The Crucial Role of Customer Service in Outsourcing Success
10. Office location
We highly recommend outsourcing to a company located in a central business district since they have better access to modern infrastructure, reliable power and internet providers, transportation facilities, and commercial spaces.
To give you some ideas of what these places are, take a look at the list provided by the Department of Information and Communications Technology (DICT) and the IT and Business Process Association of the Philippines (IBPAP):
These cities, according to the National ICT Confederation of the Philippines (NICT), were classified based on the “quantity, quality and scalability of talent, availability of infrastructure, competitive cost of doing business, government support and business environment.”
11. Work arrangement
While not as crucial as the other factors above, knowing the work arrangement of a service provider is also necessary.
Like other companies across the globe, many Philippine-based company has embraced the hybrid and/or remote work setup. Some BPO companies, on the other hand, have implemented a full return to office policy.
In most cases, as a potential client, you can have the option to choose if you’d allow a hybrid or remote setup — or you’re more comfortable having your outsourced team work onsite.
Read also: Your Comprehensive Guide to Outsourcing in Offshore Locations
Your choice of accounting outsourcing company in the Philippines have a huge part on the success of your outsourcing engagement. Make the most of your investment by choosing the one that can address your business needs and has a good reputation in the industry.
Specialized finance and accounting outsourcing company in the Philippines
D&V Philippines is a business process outsourcing company that specializes in finance and accounting, audit support, analytics, and admin support. We make it our mission to provide a wide range of high-quality support to CFOs and professional services firms in areas where they need us the most.
Want to know if we’re a suitable outsourcing partner for your company? Contact us today or download our whitepaper, D&V Philippines: Your Talent Sourcing Partner.
*Source: Professional Regulatory Board of Accountancy Chairman Noe Quiñanola via ABS-CBN. Chairman Quiñanola said that although there are almost 200,000 CPAs in the Philippines, the latter is still in high demand because they are “drivers for economic growth” and many organizations need them now. The news also stated that Filipino CPAs are being hired abroad due to their professional competence, which is why the country still needs to produce more accountants.
