What Is F&A Outsourcing?
There are several components of the BPO which is business process outsourcing and of these components includes the F&A outsourcing. This means the finance and accounting outsource. Other components of the business process outsourcing applications are HR which is human resources, A/P which is accounts payable, and A/R which is account receivable. Most companies so far have outsourced the accounts payable and the account receivable but the F&A outsourcing is just now starting to grow and it has been projected that it will grow at least at a 9.6% compound annual rate and top $27.6 billion by the end of 2008.
There are any companies that are starting to follow suit on the F&A outsourcing and there have been some scenarios that these companies should follow when thinking about F&A outsourcing. These three scenarios a limited set of transactions, a larger package of finance and accounting processes, and all finance and accounting activity to be outsourced. With the F&A outsourcing scenario of a limited set of transactions meaning that the intensive finance and accounting processes are outsourced including payroll, accounts receivable and accounts payable due to the fact that these transactions are fairly straightforward and then the company can just hire one or two agents to watch over the delivery. With the F&A outsourcing scenario of a larger package of finance and accounting processes meaning that the outsourcing should include the general ledger activity, the fixed assets and tax compliance but the client retains core responsibility. With this type of scenario, it may allow the company to have more hired help and it may involve a much longer and more complex transition period. With the F&A outsourcing scenario of all finance and accounting activity be outsourced means that everything under the chief accountant which means that there will be even a longer more complex delivery and a lot more staff. Whichever scenario works best for the company on their venture of F&A outsourcing, the company needs to be focused on the experience and expertise that they have in finance and accounting, they need to have an on site, onshore, and offshore delivery model, they need to have highly skilled offshore accounting professionals, and they need to have dedication for their continuous movement. |