How Bookkeeping Outsourcing Minimizes Your Firm's Compliance Risks

With the continuous changes in today's economy, political atmosphere and even environmental stations, the rules and regulations that govern the operations of almost every industry adapt accordingly – undergoing continuous change as needed.  

Because of this, regulatory compliance has become more than just a best practice that your firm has to adhere to, it has become a taxing non-negotiable requirement that needs a significant amount of time, effort, and monitoring to assure complete compliance. 

Whether you belong in the housing industry, the healthcare industry or the finance and accounting industry, maintaining accurate financial records remains to be the key to regulatory compliance. It stands as the foundation for your firm to be able to meet ever-changing legal obligations that allows for your operations to continue seamlessly and avoid penalties or repercussions of any kind.  

However, while most view compliance as something that needs to be checked off from a to-do list, especially around the time when tax documents are due, it is more of a year-round effort that requires significant resources.   

Being able to stay compliant in your industry requires familiarity with your tax requirements, regulations set forth by the regulatory body that governs your industry, and accurate and timely bookkeeping throughout the entire year to make sure your financial documents are in order come year end. For firms in the finance and accounting industry, this means allocating significant resources to make sure that your books and your compliance efforts are in order. 

 
This is where bookkeeping outsourcing comes in. As an accounting firm, your finance and accounting professionals were employed to provide expert accounting support to your clients, not spend time having to make sure your books are in order. By partnering with a trusted outsourced bookkeeping support provider, you can offload complex bookkeeping and compliance tasks and have your employees focus on income generating tasks instead. 

The Risk Associated with Compliance 

As mentioned before, the constant change in our economy, political and environmental stage has caused quite a few amendments to rules and regulations for several industries. Couple this with the fact that technology is advancing at a rapid pace and one way to safeguard compliance efforts is for governments regulations to become more stringent throughout the years, the need for support to stay on top of these changes have definitely increased.  

In a nutshell, when it comes to the finance and accounting sector, staying compliant usually involves the following: 
 

• Timely and accurate tax filing 

• Adhering to industry-specific reporting requirements 

• Managing payroll taxes and benefits 

• Keeping audit-ready documentation 

• Ensuring secure data handling and retention 

What happens when you are unable to comply with the requirements above? 
 
Depending on your locality and governing body, failure to comply can mean several things. From loss of trust by your clients since you are expected to be on top of your finance and accounting needs resulting to a reduced client base to incurring severe penalties and even legal action if your non-compliance proves to be harmful to some or all of your stakeholders.  

For example, a common risk when it comes to in-house bookkeeping and compliance efforts is human error. With compliance, it is important to note that all your records must be accurate right down to a T – even a small mistake like a lapsed transaction can result in non-compliance, with no chance for a do-over until the next calendar year. 

With an internal team who may also be in charge of client tasks as well as be using outdated systems that do not update themselves in real-time whenever there are changes in compliance requirements, the risk of exposure due to human error is significant.  

Importance of Bookkeeping Outsourcing 

What Is Bookkeeping Outsourcing? 

Outsourced bookkeeping support refers to being able to delegate your own financial department's bookkeeping task to a third-party provider who provides specialized finance and accounting support. Most of these providers usually work offshore, allowing you to tap into global expertise and talent. 
 
Some of the services they provide are:  

• Recording financial transactions 

• Reconciling accounts 

• Managing accounts payable and receivable 

• Generating financial reports 

• Preparing tax documents 

By outsourcing these tasks, although they seem simple and routine, you benefit from having an objective eye on your financial records, making sure that there is no information missed, and no transactions left unrecorded.  

Couple this with the fact that most outsourced finance and accounting partners use the latest in accounting technology, you can easily streamline your financial management processes and add an extra layer of security for your financial data. 

How Bookkeeping Outsourcing Minimizes Compliance Risks 

Access to Specialized Compliance Expertise 

A trusted outsourced bookkeeping provider employs professionals who are well-versed in international accounting standards (IFRS, GAAP) and tax regulations across several localities and offshore countries. Their team includes certified accountants and seasoned professionals with experience handling clients’ finances from all over the world and can help you navigate any changes in your regulatory requirements. 
 
Given the nature of their operations, their teams are also regularly trained to stay updated on the legal and regulatory changes set by the different regulatory bodies relevant to the industries their client belongs to. 
 
By employing their support, you'll be able to:  

• Stay ahead of changing tax laws 

• Implement best practices in documentation and reporting 

• Ensure regulatory deadlines are met  

Built-in Risk Management Processes  

Your outsourced bookkeeping support regularly conducts audits on their own services and service delivery processes – which is how they provide bookkeeping support for you. These audits comply with certain quality control procedures that are able to detect errors both in their own processes and yours even before it escalates and proves to be a problem. 
 
Errors they might flag are:  

• Redundant review processes 

• Automated transaction reconciliation 

• Standardized workflows and audit trails 

While these internal controls may not seem related to the financial documents and compliance efforts your firm takes to be able to remain compliant, such internal controls can easily normalize wrong processes which can result in inaccurate financial documents.  

With an outsourced provider who can identify potential risks such as this, you are able to replicate your processes with an offshore team who can continue the work as you fix your internal controls – ensuring business continuity while also producing accurate, complete and audit-ready financial documents.  

Timely and Accurate Reporting 

Some of the most common non-compliance issues root from late submissions, incorrect filings and misstatements that result in audits, and even penalties. With outsourced accounting, you can make sure that their core tasks remain to be creating and managing timely and accurate financial documents and reports that are: 

• Generated on schedule 

• Formatted to regulatory standards 

• Verified by professionals before submission 

When it comes to financial reporting, timeliness is key. This not only helps maintain your firm's compliance but also supports your stakeholder's decision-making efforts that can ultimately lead to your company's growth and sustainability.  

Enhanced Data Security and Confidentiality 

With the advancement of technology comes the advancement of cyber risks and threats. These threats ultimately increase your firm's risk as a breach in your security may mean a leak in financial data (both yours and your clients') that may or may not result in reduced trust, legal repercussions, and costly audits. 
 
Keeping up with the times, outsourced accounting providers usually employ the latest in cybersecurity software and apply best practices to all of their internal controls. This means that your financial information with them will be secured with:  

• Data encryption protocols 

• Secure cloud-based platforms 

• Regular backups and disaster recovery systems 

• Employee access controls and confidentiality agreements 

By outsourcing your bookkeeping, you gain access to enterprise-grade data security systems that may not be your firm's priority to invest in as of the moment.  

Scalable Compliance Support 

As your client base grows and expands over several localities and industries, so do your compliance responsibilities. Outsourced support helps you in this regard as they can easily scale your own internal bookkeeping operations as well as the services you provide for your clients without increasing your risk of non-compliance. 
 
Whether you are handing clients from a new market, undergoing complex transactions and agreements you have not undergone before or even preparing for an external audit, your outsourced team can easily help prepare requirements that are seasonal, one-off and on an as-needs basis as soon as you need them – ensuring a good relationship with regulatory bodies and further building trust with your clients.  

Why Choose Bookkeeping Outsourcing in the Philippines? 

When it comes to outsourcing, there are a few countries that are known to provide quality outsourced support for several industries – customer relations, technology and yes, finance and accounting. In this regard, the Philippines has been able to establish itself as a prime location for quality bookkeeping outsourcing services, a country trusted globally.   
 
When outsourced to the Philippines, you gain access to the following: 

Skilled Talent Pool 

The Philippines produces thousands of accounting and finance graduates every year, many of whom are certified public accountants (CPAs) with global training and experience as well as those who graduate with a degree in accounting technology and accounting information systems – making sure that finance and accounting professionals are proficient in the latest in finance and accounting technology and trends. Filipino professionals are also known for their: 

• Strong command of English 

• Familiarity with U.S., Australian, and U.K. accounting standards 

• Detail-oriented and process-driven approach 

These qualities significantly help when it comes to managing the finances of clients who operate outside of their own country, offering their global expertise to be used by clients to position themselves as a trusted entity worldwide. 

Cost Efficiency 

Availing bookkeeping outsourcing support in the Philippines offers one strategy for firms – cost effectiveness. In the Philippines, you gain access to high-quality financial and accounting support at a fraction of the cost if you would be hiring additional staff within your own locality or outsourcing from a third-party provider there. 
 

Cultural Compatibility and Time Zone Advantage 

Filipino professionals have a reputation for professionalism, adaptability, and a strong service mindset – making them known to be a hospitable people who are always ready to help others, whether their own or foreign clients.  

Alongside this, their overlapping time zones with Western countries allow for them to work with you for real-time updates, communication and collaboration while also giving you the option of having them work during your locality's after-office hours, assuring 24/7 accounting services. 

Proven Track Record in Outsourced Accounting 

Many businesses (both those belonging in the finance and accounting industry and not) across the U.S., Australia, Canada, and Europe already rely on professional services from the Philippines. They often use full-service bookkeeping, payroll or tax support as well as part-time and full-time CFO support services to help with their own operations. Whatever the need, local providers in the Philippines offer reliable and scalable solutions that can grow along with your business.   

How to Choose the Right Outsourced Bookkeeping Provider 

With all outsourcing arrangements, it is important to note that maximizing the benefits of outsourcing relies on choosing the right provider to provide you with your bookkeeping team. 
 
Here's a few things to look out for:  

• Experience in your industry: Choose experts familiar with your regulatory requirements. 

• Transparent processes: They should outline how work is reviewed, stored, and secured. 

• Technology compatibility: They must integrate with your existing accounting software (e.g., Xero, QuickBooks, NetSuite). 

• Data protection compliance: Confirm if they follow global data security standards to keep your financial information protected. 

• Client references and case studies: Ask for evidence of successful engagements, especially with compliance-heavy clients. 

Read: Offshore Accountants Case Study: How We Assisted Assist Group 

The Bottomline 

As the finance and accounting industry undergoes continuous changes, compliance becomes a basis for your firm's integrity, risk management capabilities, and operational continuity. Through outsourcing your bookkeeping needs, you can easily turn this heavy responsibility of always remaining compliant from a stress point into a strategic strength – positioning you to be the firm of choice for your clients. 

With the right outsourced team and by employing bookkeeping services in the Philippines, you can protect your firm from regulatory repercussions, streamline the financial processes you do have, and have your internal team focus on client-facing tasks that directly help with revenue. 

Read Next: Standard Bookkeeping Practices that Ensure Tax Compliance 

Consider Bookkeeping Outsourcing in the Philippines!  

D&V Philippines’ commitment to staying on top of all regulatory changes relating to tax and compliance has allowed us to effectively handle our clients’ books for over a decade. If you want to see our comprehensive bookkeeping services, you can download our Accounting Outsourcing Whitepaper  here.   
 
Interested? You can contact us here and see how we can help tailor our solutions to fit your company’s specific needs!