How Top Outsourcing Companies In The UK Are Solving Accounting Skills Shortages?
Many small accountancy firms in the UK are failing to recruit the talent their firms need. The shortage of high-skilled accountants in the UK is changing the perception of outsourcing. Small accountancy firms are realizing that the only way to support their growth as a UK company is by getting dedicated offshore experts. If small accountancy firms in the UK are unable to get the staffing resources they need, it will be unmanageable for them to remain competitive.
The misconception that outsourcing ‘steals’ British jobs has finally been cleared. Small accountancy firms are outsourcing key bookkeeping responsibilities to make the most of their local staff’s skillsets. With reduced responsibilities, they now have the time and resources to manage other aspects of the accountancy firm, such as training fresh talent.
Understanding the Talent Shortage
Signs of talent shortage in the UK’s accounting sector have been visible for many years. A 2018 study by UK’s leading recruitment agency Total Jobs confirmed this shortage.
According to the study –
- 60% of accountancy firm employers who participated in the study said they expected severe skill shortages in the accountancy and finance sector.
- 80% of the Chief Financial Officers who participated in the industry, expected their accountancy workloads to increase.
- 55% of the CFOs who participated in the industry, said they had plans to increase the workloads of their employees to address the increasing demands.
Every year, the demand for financial experts increases in the UK. The accounting and finance managers who are currently employed feel they should earn more. These factors combine to widen further the skills gap in the UK’s accounting and finance sector.
Rise of Outsourcing
The trend of outsourcing accounting responsibilities became popular amongst small accountancy firms in the UK because of technology.
Even small-sized accounting firms are attempting to expand the scope of their services, given there’s such a high demand for accountancy services.
They realize that there are significant benefits to completing assignments quickly and expanding their services.
These small accountancy firms have also realized that digital communication tools are unstoppable. Not using these technologies to reduce workload or increase revenues is a mortal sin for the smaller accountancy firms looking to survive in the competitive market.
These two realizations have enabled small and medium-sized accountancy firms in the UK to tap into resources that outsourcing promises. It’s the only way they can have a competitive advantage in the current market.
ForrestBrown, a leading research and development tax credit agency in the UK revealed in their study that –
- 64% of accountancy firmsin the UK are looking forward to outsourcing core accounting responsibilities to stay competitive in the industry
- 67% of the accounting firms that participated in the research stated they consider outsourcing valuable services. These are the services that small accounting firms in the UK cannot provide with their limited capabilities (e.g., lack of computerized accounting systems).
All the senior accountancy professionals who took part in the study confirmed that they planned on using outsourcing to advance their firms’ commercial interests. The top outsourcing companies in UK have met these demands by providing high-skill and low-cost services.
How Outsourcing Creates A Skilled Workforce?
For small accounting firms in the UK, a clear benefit of outsourcing is gaining a skilled workforce. Given the costs of recruiting in-house accountants are so high, companies who outsource can pay higher salaries to their existing workers. Here are some other ways in which outsourcing helps create a more efficient workforce –
- Flexibility – Most small and medium-sized accounting firms in the UK have trouble dealing with hectic schedules. At specific periods of the year, the workload is almost unmanageable. Outsourcing core accounting responsibilities relieves the workforce of this pressure.
- Up-Scaling – When companies outsource their bookkeeping responsibilities, they have a global talent pool to choose from. An offshore expert will ‘crunch numbers’ and handle day to day tasks while the firm can expand to business advisory services or consultancy services.
- Cut Costs – Outsourcing enables small accountancy firms in the UK to take on more value-added tasks and projects. Hence, they experience a firm increase in revenue. Plus, they don’t have to indulge in expensive processes such as recruitment or staffing. Overall, outsourcing not only helps small accountancy firms in the UK, generate more revenue, they also cut the annual budget.
- Audits – One of the key areas of expertise that outsourced bookkeepers offer is keeping the firm ‘audit-ready.’
- These offshore experts sign clear confidentiality agreements that prevent them from disclosing any client-related information. Then, they handle all the tasks related to compliance, such as preparing financial statements for auditors, creating a report for the HM Revenue and Customs (HMRC), etc.
Using the vast talent pool of offshore accountancy experts at economical costs enables small accountancy firms to expand. Their contributions to the UK economy drastically increases once they start expanding.