Many start-ups and small business owners in Singapore are outsourcing their accounting duties to other firms. It might seem counter-intuitive: Why would a small business entrust another firm with their finances? However, there is wisdom in this practice. Outsourced accounting services might seem like an unnecessary expense, but the costs of hiring and maintaining an in-house accountant are far more.
There are many benefits to outsourced accounting services, especially in Singapore. The expertise and professionalism that comes with accounting firms make them reliable and trustworthy. In this article, we shall look at some of the positive outcomes of outsourced accounting services in Singapore.
When to Consider Outsourcing Your Accounting Duties?
Small businesses need to consider outsourcing their accounting function before hiring an in-house accountant. Here are some of the scenarios when outsourced accounting services work best:
- A small business that doesn’t need an in-house accountant.
- A company fails to find a suitable accountant at an affordable cost.
- A growing business with the need for accounting services to meet changing financial needs.
- Temporary assistance due to manpower constraint, for example, when the staff in charge is away for personal reason.
Benefits of Outsourced Accounting Services
Outsourced accounting service providers exhibit professionalism and expertise in financial matters. They offer a wide range of services, including bookkeeping, daily administrative support, payroll-related, managing accounts payable and accounts receivable, filing income tax returns, ECI (or Estimated Chargeable Income), and preparing other reports for special reasons. On the other hand, hiring an in-house accountant can lead to less accuracy and maybe even losses when it comes to misinterpretation of any financial laws.
Here are some of the benefits of outsourcing accounting services in Singapore:
No Need to Hire Full-time Accountant
Small business enterprises may not need to hire a full-time accountant for their firm. They deal with a limited volume of work, which means they can do without a fully paid accountant. That is why hiring outsourcing accounting services is a more feasible approach. With outsourcing, a firm can review their finances and periodically plan for the future, while freeing up time to create new business strategies.
Cost Savings
Setting up a company in Singapore and maintaining it require a lot of work – not to mention that it is very costly. Outsourcing might seem like an expensive venture, but you’d be surprised to learn that outsourcing saves a lot of money in the long run. Outsourced accounting services reduce expenses, usually attributed to a full-time employee. It removes the need to pay the salaries, bonuses, pension or levies, and other benefits for an accountant. With outsourcing, you only pay for accounting services, nothing extra. You get better quality services for less money than it would take to hire and maintain a full-time employee. There is no loss in productivity that usually affects employees in a company.
Expertise
Outsourced accounting services provide the option of hiring professional accountants with high levels of expertise at an affordable price. Small businesses in Singapore can benefit from a team of highly qualified accountants who provide integrity and deliver work on time. Accounting services make sure to cope in a competitive market by continually improving their qualifications and skills. These are all readily available to companies should they choose to outsource their accountants. Moreover, external auditors do a better job of reducing errors in their work – considering that they may lose a contract if they mess up.
Accuracy
When it comes to outsourced accounting services, the margin of error reduces significantly. Accounting firms will usually utilize accounting automation software to save time. Using accounting software reduces the amount of time spent in preparing tax returns, tracking expenses, and producing financial reports. In addition to saving time, automation reduces the number of human errors. Using Optical Character Recognition (OCR) and Artificial Intelligence (AI) result in a high level of accuracy.
Scalability
When it comes to outsourced accounting services, one of the most significant benefits lies in the ease with which the business can expand without requiring any additional employees. Most accounting firms in Singapore can accommodate small to large corporate sizes when it comes to accounting services. If a business gets a sudden growth in its finances, there will be no requirement to hire extra accountants. The outsourced accounting service will step up to the job without any lags.
Conclusion
Taking accounting into your own hands may not be the most feasible option in the current Singapore’s economic climate. Businesses and start-ups are popping up all over the country, and starting up a business is no easy feat. Consider the following: registering a business, preparing all the documentations required under the Companies Act, getting licenses and permits, and registering for Goods and Services Tax (GST). These are time-consuming tasks that cannot be done by a single individual. That is why outsourced accounting services are so prevalent in Singapore today.
Connect with us today to get a suitable package under our accounting services for your business in Singapore.
