Outsourcing Accounting Services

In recent decades, there has been an increase in the number of UK based companies turning to countries like India & China to reduce costs. The process is known as offshore outsourcing and was initially used by manufacturers to gain access to cheap labour. Over time, India has developed as an outsourcing nation and is able offer a range of outsourcing solutions, including accounting services. Larger companies have utilised this service to outsource entire departments to countries like India and have been doing so for a number of years. The opportunity has now arisen for small to medium sized enterprises (SMEs) firms to explore such solutions. The aim of the study was to identify the perceived risks in relation to offshore outsourcing and ascertain the measures in place to control these risks. A review of existing academic literature established the various advantages and disadvantages associated with outsourcing. The perception of forty-four UK based SMEs was obtained by way of postal questionnaires, revealing that majority of firms held an apprehensive attitude to offshore outsourcing. Having identified a number of risks, interviews with offshore service providers were required to ascertain if any relevant safeguards were in place. The research concluded that the providers had recognised the risks and introduced appropriate preventative measures