This article is a submission by Workforce Africa. Workforce Africa is the leading Market entry and Offshoring services provider in Africa that adopt a strategy-first approach to meet each client’s needs ensuring their solutions fits just right.
Some myths surround most things, and those myths often persist. The outsourcing myth has, over the years, impacted the finance and accounting business.
Financial services can be treated as ‘we are either doing it in-house or outsourcing.’ Each company has its own needs that a business should consider before deciding to do the work in-house or outsource to renowned destinations like Africa.
For financial institutions, only a few accounts are critical and may require an in-house person who can focus on them. This person may have to handle reconciliation, banking, and other details such as reconciliations or bank deposits.
On the other hand, financial institutions commonly require other financial services such as bookkeeping for other assets such as stock, bonds, or precious metals.
Drawing upon experience from accountants in Africa, they know what is needed and will be able to “step into” new markets more quickly than a non-professional can.
In this article, we’ll uncover ten common myths about outsourcing finance and accounting to Africa.
Outsourcing finance and accounting
This means a company has temporarily decided to farm out finance and accounting functions to another firm, which can be based onshore, nearshore, or offshore. Instead of hiring a full-time employee, outsourcing is the way to go.
Most companies, small and medium enterprises, undergo extensive financial restructuring as part of their business strategy. These businesses must consider the significance of finance, accounting, and bookkeeping in developing their business plan.
This is why many companies are now looking at outsourcing finance and accounting functions to hire remote employees from Africa. However, these myths surround outsourcing finance and accounting functions to Africa.
10 myths on outsourcing finance and accounting to Africa
Outlined below are ten common myths surrounding outsourcing finance and accounting to Africa:
1. Companies do not have access to skilled accountants in Africa
The opportunity for quality services is very much present in Africa, with professional accountants available who specialize in various areas, such as banking, financial tracking, accounting, and currency reconciliation.
Talents in Africa also have extensive work experience, making them one of the best employees globally.
2. Outsourcing to Africa means losing control over my company’s finances
When you outsource to Africa, you don’t have to worry about the bookkeeping for your business anymore.
With a dedicated bookkeeper, your company’s finances will be thoroughly accounted for so that you can concentrate on core business operations, including marketing and sales.
You should know that outsourcing is possible without losing control of your company’s finances.
3. Outsourcing to Africa comes with high costs
When working with professional accountants in Africa, you can reduce those costs and get the best value for money possible.
The price of management and staff in Africa is far lower than in Western countries. This means accounting services can be more affordable.
Outsourcing finance and accounting is not about losing control of your company’s finances. It is about obtaining the services of a professional finance or accounting firm.
Finance or accounting firms can work alongside your staff to automate and streamline processes without compromising your company’s business objectives. They allow for greater efficiencies in helping you meet specific deadlines.
4. Outsourcing means I don’t have to worry about tax compliance
Outsourcing means using the services of an accounting firm to help manage taxes. You may pay for this service weekly, monthly, or quarterly. It will still be less expensive than hiring an accountant full-time if you have more than two employees.
It doesn’t mean you won’t have to worry about taxes. You are still responsible for paying your taxes, and the accounting firm will be able to advise you on how to do this promptly and cost-effectively.
5. Outsourcing is only for small enterprises
Outsourcing is for more than just small enterprises. Large enterprises use it to gain access to a range of services done by professional firms at an affordable price in Africa.
This myth is that people think only financial institutions need this level of service. Outsourcing finance and accounting is suited to small and medium enterprises and large enterprises.
Outsourcing is a great way to streamline your company’s processes while increasing productivity.
6. Outsourcing means moving your business to another country
Outsourcing does not mean moving away from the shores of the present country where you are. It is just a type of business relationship where you partner together with a professional firm or, in most cases, you become their client.
7. All large accounting firms in Africa are bad
Many accounting firms in Africa are good. They have years of experience and sound business practices in the areas they specialize in, such as manufacturing, retail, construction, or government contracting.
However, just because a company is big and well-known doesn’t make them the best choice for your business needs.
Large companies often do not see the need to provide competitive and individualized rates for their customers. This oversight may be due to their size and position concerning other companies within their industry.
8. Outsourcing to Africa means I leaked my data privacy
Outsourcing to Africa does not mean your company’s financial data is exposed.
All financial information about your business is held in a central location and protected with stringent measures, which include access passwords and other authentication procedures.
9. Outsourcing means I’ll have to terminate staff
Outsourcing does not mean you will have to terminate staff. It is possible to outsource with your existing staff. You can partner with an accounting or bookkeeping firm in Africa to achieve excellent results.
10. Outsourcing is only suitable for virtual assistance
Contrary to what people think, virtual assistance is not the only service you can outsource to Africa. You can use outsourcing in a much broader sense and learn a lot.
Outsourcing providers in Africa have an array of services to support various business operations.
Benefits of outsourcing finance and accounting services to Africa
Outsourcing finance and accounting functions to Africa may benefit companies that want to simplify their financial procedures and lower operating costs.
While outsourcing to any location comes with considerations, here are some benefits of outsourcing finance and accounting services to Africa:
The cost of outsourcing accounting services in many African countries is lower compared to Western countries, making Africa an attractive option for cost savings.
Outsourcing eliminates the need to invest in office space, equipment, and infrastructure, reducing overhead costs.
Africa has a growing pool of skilled accountants well-versed in international accounting standards and practices.
Hiring remote talents in Nigeria and many African countries, such as Ghana, and Kenya, with a high English proficiency makes communication with offshore teams easier.
Knowledge of international regulations
Many African outsourcing firms are well-versed in international accounting standards and can help ensure compliance with various regulatory requirements.
Outsourcing providers in Africa have experience in specific industries, providing specialized accounting and bookkeeping services tailored to your needs.
Outsourcing to Africa will always give you a better-quality job. African professionals, particularly finance and accounting specialists, have years of experience in the field.
Increased productivity with outsourced work
The level of productivity increases when an outsourced firm can help you hire a dedicated team to work with your business instead of hiring a separate company for each project.
Focus on core activities
Outsourcing non-core functions like finance and accounting roles allows your in-house team to focus on strategic activities and core competencies.
Outsourcing finance and accounting to Africa – a strategic move
It is not a myth! Outsourcing your finance and accounting services to Africa is rewarding.
Most African countries have qualified accountants and bookkeepers who are available when you need them.
You will have access to a skilled workforce at a fraction of the cost you would incur in your home country.