Bookkeeping and accounting have always been trending issues in the present and historical business world. Therefore, companies around the world are continuously facing the challenges of keeping accurate and efficient bookkeeping processes. It is the most crucial but challenging part of business operations that requires precise attention to details, professional expertise to ensure financial security, and support in making informed decisions. Thus, outsourced bookkeeping services firms in India serve as seasoned experts who come with strategic solutions to the various upcoming challenges. The Algebra Group is one of the best providers of outsourced bookkeeping and accounting services, where they are experts in mitigating issues and enabling access to advanced tools that significantly improve operational efficiency at a lower cost compared to an in-house bookkeeping team.

What are Outsourced Bookkeeping Services?

To understand what outsourced bookkeeping services is we need to know what outsourcing is. It is one of the most common terms used by businesses across the world. It can be fields like accounting, bookkeeping, and software development or any other sector. But it benefits both parties: the hiring company and the outsourced bookkeeping services firms in India.

Outsourced bookkeeping services means the practice of hiring an external third-party firm or an individual to manage the entire financial records and reports of a company. This service includes maintenance of accounts receivable and payable, creating financial reports, analyzing bank statements, and recording company expenses.

Outsourced bookkeeping services firms in India offer businesses an opportunity to save ample amounts of their time and money while benefiting from the guidance of expert professionals who also ensure that the financial records are precise and complete.

Here we, “The Algebra Group,” are open to providing outsourced bookkeeping services on demand and supporting you in keeping your records accurate and up-to-date.

Why are Indian Bookkeeping Firms in High Demand?

India is a source of skilled accountants and bookkeepers, making Indian bookkeeping firms one of the most highly demanded destinations for small, midsize, and large corporations. When the global accounting firms hire Indian bookkeeping services, they are offered a range of benefits, starting from cost efficiency to exceptional services.

Outsourced bookkeeping services firms in India are known for their expertise in financial administration and application of advanced technology. Such factors offer the hiring party an extra edge compared to other outsourcing locations.

Outsourced bookkeeping services firms in India help offshore clients reduce their operational expenses while maintaining competent professionals who understand the standards of the U.S. accounting industry.

Faster processing timelines, scalable services, trustworthy regulatory support, and many more—there is no limitation to the benefits offered by Indian outsourced booking firms.

Key Benefits of Outsourcing Bookkeeping Services –

The basic benefits offered by outsourced bookkeeping services firms in India are as below:

1. Easy Growing and More Flexible

1. The significant benefit of outsourced bookkeeping services firms in India is that they grow along with your business demands or needs. When a business hires an outsourced bookkeeping and accounting firm, they can easily increase or decrease the amount of services required by them according to their needs.

2. For instance, a business company can quickly demand more help during peak periods, such as tax filing or holiday sales, without having the pressure of recruiting any expert professionals or new staff.

3. This favors companies, as the outsourced firms offer more options, like paying for only those services that they have used. Easy access to the advanced tools and technologies for both small and large companies without spending much for those high-quality services.

Read more: What is Cost Structure?

2. Enhanced Data Privacy and Security

1. When a company appoints an outsourced bookkeeping services firm in India, they actually work on a real-time bookkeeping software application that helps the company to keep an instant track of records and activities. This approach supports both the companies and the outsourced firm in identifying and fixing the gaps before they become more complex.

2. The reconciliation of accounts by designated professionals is a high-level inspection that prevents fraud. Along with that, outsourced bookkeeping services firms in India divide responsibilities, document workflow, and provide accessible audit trails, all enhancing data privacy and security.

3. Also, outsourced bookkeeping firms make investments in advanced technology to safeguard the confidential financial data. Additionally, they adhere to privacy laws and regulations while ensuring that they implement best practices for data protection.

4. In simple terms, outsourcing bookkeeping and accounting services implies that your financial information is in secure hands and company holders can assure themselves that it will remain confidential.

Read more: Top Accounting Firms in India

3. Enable Businesses to Focus on Core Competencies

1. When a business outsources secondary but crucial functions such as accounting and bookkeeping, it helps businesses to focus on their main functions. These main areas include innovation, product development, customer services, etc.

2. This saves companies time, energy, and resources for managing regular financial activities. This type of transition by companies helps them build a competitive edge and improve overall business performance, which contributes to sustained growth and higher profitability.

3. Basically, it means that outsourced bookkeeping services firms in India allow businesses to perform their primary tasks more efficiently and meet the target effectively.

4. Saves Cost

1. Recruiting a full-time permanent staff requires lots of money; on the other hand, appointing outsourced accounting and bookkeeping services saves lots of money. If a company employs an in-house accounting team, then they are a liability for the company. Because the company has to pay for their perks, training, monthly salaries, and the cost of running the department, even when services are not being utilized by them.

2. But when you outsource a firm or an individual for similar tasks, then the company has to pay only for those specific services that are being utilized. This reduces the departmental maintenance cost and other service costs. These saved funds help the administration to invest in the core part of the business to increase profitability.

5. Easy Access to Real-Time Financial Reports

1. Outsourced bookkeeping services firms in India offer one of the best benefits is easy availability of any financial reports of your company. At any point in time, you can have access to detailed accounting reports that highlight the actual financial performance of the business.

2. The maintenance of reports includes cash flow data, balance sheets, and profit and loss statements. As the business grows, this data also adds on, and it becomes challenging for the company to handle large data sets. But bookkeepers keep this data well organized and accurate, so it becomes easy for the management team to understand and analyze it.

3. Having well-organized data helps you in making smart choices for the growth and development of the company. The deeper you understand your company’s financial status, the better strategy you can make for the future.

Top Features of Professional Bookkeeping Service Providers in India –

Selecting reliable bookkeeping firms is one of the most important things, as they are responsible for providing accurate, compliant financial records. This highlights the clear overview of the company’s financial health.

Following are some of the top features that ensure they are the best professional outsourced bookkeeping services firms in India:

Read more: What is Bookkeeping?

1. Industrial Expertise and Experience

1. While starting the procedure of hiring an outsourced bookkeeping services firm in India, the first thing that should be considered is their industry experience and expertise. A reliable bookkeeping service provider has a solid understanding of accounting principles such as compliance rules, tax requirements, and financial complexities, and has years of experience working in that specific industry.

2. Thus, a bookkeeping service provider having industrial expertise and experience has high-quality standards for handling unique challenges while offering tailored solutions.

2. Accuracy and Focus on Details

Outsourced bookkeeping services firms in India have accuracy in maintaining financial records and keen observation of details. Because even a small mistake or avoidance can result in severe financial losses, such as a penalty on tax compliance issues, failure of trust of stakeholders, and poor business decisions.

3. Cloud-Based Solutions and Bookkeeping Automation

1. Outsourced bookkeeping services firms in India utilize cloud-based solutions such as QuickBooks, Xero, and Zoho Books, as they allow them real-time data entry and quick access to financial reports anytime and anywhere.

2. Additionally, bookkeeping automation reduces manual errors, speeds up task-performing capability, and saves time. This helps bookkeeping firms to have seamless interaction between them and their clients.

4. Offers a Wide Range of Services

A trusted outsourced bookkeeping services firm in India offers a wide range of services to fulfill the client’s demands. Various services include managing accounts receivable and payable, payroll processing, bank reconciliations, and financial reporting. They are experts in handling every aspect of clients’ financial operations.

5. Punctual and Meets Deadlines

Reliable outsourced bookkeeping services firms in India always adhere to deadlines and ensure that records are updated on time. As the financial reports are the mirror image of business financial health, that supports making informed decisions. It is one of the crucial factors that can affect everything from budgeting to tax payments and can also result in negligence of opportunities.

6. Secure and Safe

Strong outsourced bookkeeping services firms in India follow standard data protection protocols to safeguard clients’ financial data. Because any misuse of any type of data results in legal complications, financial losses, and public image issues. Therefore, they are capable enough to secure the highly sensitive factor, which is financial information.

7. Cost-Effective

Last but not least, reliable and right outsourced bookkeeping services firms in India are cost-effective. Because only the one who offers both quality and budget-friendly services always aligns with the company’s business needs and affordability.

Read more: What is Cost Accounting?

How Outsourced Bookkeeping Works (Step-by-Step Process) –

1. Onboarding

It is the induction period for both parties before working on any project. In this step, the hiring party clarifies details and expectations with the appointed outsourced bookkeeping services firms in India or an individual. Because even a small hidden truth can break the bridge of progress and result in failure.

2. Outsourced Bookkeeping Firm Conducts a Deep Investigation into Actual Accounting Process and Books

In this step, the outsourced bookkeeping services firms in India study the business’s current accounting processes and its documentation. This ensures that the previous records are aligned with the accounting standards, and hence, they can be smoothly transferred from the in-house accounting team to an outsourced bookkeeping firm.

In this step, they build a strong foundation by conducting the following steps:

1. Figure out the monthly accounting process to outline tasks and responsibilities more precisely for providing a better contribution.

2. Evaluates the account chart and updates it to provide better insight into monthly account statements.

3. Also, ensure that the accounting records comply with the reporting standards.

3. Prepare a Tailored Process Map and Communication Plan

This step helps the outsourced bookkeeping services firms in India prepare a customized process map that will outline what activity will take place, when, and who will perform it in that specific month, so that they will perform their actions on time and will deliver month-end reporting timely.

This process is customized based on the client’s business requirements and the services to be offered.

4. Permission for Accessing Records and Accounting Software

1. After a deep study of ongoing processes and the new process map in place by the outsourced bookkeeping services firms in India, they request permission to get access to the client’s financial records and accounting software.

2. This includes access to current accounting software such as QuickBooks or Xero and tools like PayPal, Shopify, Expensify, etc. As most of these accounting platforms and software allow companies to give read-only access to credentials to third parties and block them from full access.

5. Request Access to Banking Institutions and CRA Accounts

Central record-keeping agency access helps bookkeepers with the historical sales tax filing records. As with most of the banks, applications, and accounting platforms, they give read-only permission to a third party; this means the outsourced bookkeeping services firms in India can only view the client’s account transactions without having the authority to access their funds.

Read more: What is Tax Accounting?

6. Shift to Cloud-Based Accounting Software and Set Up New Tools

1. At this stage, the outsourced bookkeeping team shifts from books to a digital platform, which makes their job much easier. Here, outsourced bookkeeping services firms in India propose that the company should digitize activities such as paper invoices, receipts, and expense tracking that are not online. Also, set up integrations with accounting tools like Dext Prepare, which allows users to take a clip of the company’s invoices and receipts and share it with the outsourced team.

2. With this approach, we help you identify loopholes in your system and support you in implementing new tools to fill up those loopholes.

7. Train Team on New Process and New Tools

This is the last stage of the outsourced bookkeeping services firms in India process, where bookkeepers train those members who are engaged in the new processes and on any new technology that has been implemented.

Core Benefits of Accounting Outsourcing Services in India –

The following are the 5 best benefits of accounting outsourcing services in India:

1. Cost-Effective

Hiring an outsourced accounting solution is much cheaper compared to hiring employees to work in-house. As the hiring party has to pay according to the services being utilized, while keeping their budgets pocket-friendly and needs fulfilled. On the other hand, maintaining a fully fledged, experienced professional team requires various expenses such as payroll, allowances, training, and gadgets and software expenses.

2. Flexible and Scalable

When the company grows, the size of the department also grows. Along with that, accounting payables and receivables also reach a large level. Hiring an expert outsourced accountant or firm is one of the cheapest ways to manage this sudden scale. As the outsourced firm increases the deployment of employees according to the requirements and demands of the company.

3. Reduces Chances of Fraud

Outsourced accounting firms safeguard their reputation with their strong security systems that prevent data theft or security violation issues. Though they have complete access to financial staff, revenue, debt statements, liabilities, and assets, their highly secured system helps them protect clients’ data and prevent fraud.

4. Not Just an Accountant but an Advisor Too

An accountant offers both the benefits of experienced support and the best advisory facility. Their experienced advice potentially changes the company’s cash flow and financial operations. They focus on identifying potential risks and challenges at the very beginning before they become major so that the financial management team can make strategic decisions.

5. Relieves Stress

The year-end is a stressful time for everyone. This is the time when companies close their annual accounts and organize every record and document and organize them.

Another distressing period is audits and taxation, which leave the employees in stressful situations.

Accounting outsourcing companies are much more efficient and familiar with such situations and have preplanning to mitigate them, like seasoned professionals.

Services offered by Accounting Outsourcing Companies in India –

The services provided by accounting outsourcing companies in India differ, as some offer limited services, while others offer many based on their specialization. Before hiring any outsourced accounting firm, you should investigate the services to ensure your need is fulfilled. Below are some common accounting services provided by the outsourced accounting firms in India.

1. Operational Bookkeeping

Operational bookkeeping is the basic service offered by most of the accounting firms. Accurate bookkeeping has a direct relationship with a business’s success. It includes tracking and tallying all the financial transactions that take place inside an organization. Outsourced accounting firms in India offer operational bookkeeping services and ensure to track real-time financial insights for their clients.

2. Tax Planning and Compliance

1. Tax preparation is the procedure of filing tax returns to indicate that the company complies with the federal, state, and local tax laws. Industries engaged in various businesses have to file a tax return.

2. Collaborating with outsourced accounting firms in India helps them prepare their taxes ahead of time by offering tax planning services. It is often done to make improvements in the tax statement or reduce taxes before a company files a tax return.

3. Payroll Processing

1. Payroll processing involves calculating salaries, deducting taxes, and distributing payments. Outsourced accounting firms also provide payroll services that seem to be straightforward, but when a business employs different professionals who have different specializations, it gets more complex. Some professionals are paid hourly, while others are paid monthly.

2. An outsourced accounting firm manages and ensures that all federal, state, and local taxes are withheld accurately from every employee’s salary and then pays them through their preferred payment method.

4. Business Development and Valuation

1. Businesses frequently require capital for the expansion of their services, which requires investment. The investors, such as private individuals or banks providing loans, demand proof of whether the company is reliable or not.

2. These proofs are presented in the form of valuation reports and audits and are provided by outsourced accounting firms in India. They thoroughly investigate and analyze previous data to find growth patterns and present the report to investors and banks.

5. Advisory Services

1. Advisory services are critical and crucial for accounting firms and is a relatively new profession in this field. When an outsourced accounting firm provides advisory services, it collaborates with that company and supports them in maintaining the book records, tax preparation, and planning.

2. These firms actively participate in clients’ businesses, use business intelligence software, and apply their expertise and experiences in overcoming financial issues and achieving their goals.

Conclusion –

In this article, we have studied how outsourced bookkeeping services firms in India are playing a significant role in managing business finances and compliance requirements. There are various outsourced bookkeeping firms and bookkeepers continue to set their standards high with their experience and expertise, but we, The Algebra Group (TAG), an outsourced accounting and bookkeeping firm, focus on meeting the demand of our clients through innovative and technology-driven solutions and maintain strong communication with them. Together, we empower organizations by working with them and primarily focusing on our clients’ success, making India a prime destination for outsourced accounting and bookkeeping services.

Frequently Asked Question (FAQs) –

1. Define outsourced accounting firms in India.

An outsourced accounting firm in India relates to appointing an external or third-party firm to handle a company’s finance and accounting functions or department. The functions include handling accounts receivable, accounts payable, handling payroll, monthly bank statement review, tax planning and preparation, lawful compliance, financial reporting, and many others.

2. Who should hire outsourced bookkeeping firms in India?

There is no cross-line for any type of industry related to who can hire and who cannot outsourced bookkeeping services firms in India. Every size of business is free to appoint outsourced bookkeeping firms, whether it can be SMEs, startups, or overseas accounting firms.

It offers a broad range of benefits, such as cost savings, access to experienced professionals, etc.

3. Is outsourcing bookkeeping a good choice?

Outsourcing bookkeeping services is a good choice as compared to recruiting an in-house bookkeeping team. When a company outsources booking services, no additional overhead costs are required, and it is the best concept for this type of approach.

4. What are the factors to be considered while selecting a reliable outsourcing partner?

The following are the steps to be followed while selecting a reliable outsourcing partner:

1. Search for industry-specific experience

2. Emphasize on accounting automation

3. Assess their communication practices

4. Review their security protocols

5. Verify they can scale with your business

6. Focus on sustainable value rather than immediate cost