Many growing businesses reach a point where the owner is still keeping the books. The choice is between hiring someone in-house or handing the work to an accounting firm.
What outsourced accounting is
A business hires an outside firm to handle some or all of its accounting and finance functions: bookkeeping, payroll, accounts payable and receivable, management accounts, tax, financial reports and debtor follow-up. In the industry it is called finance and accounting outsourcing, a subset of business process outsourcing.
Why it matters
Accounting needs little creativity, but budgeting, data analysis and compliance can make or break a business, especially a young one. Errors in tax payments or cash tracking can do serious damage. The options are an internal accountant or bookkeeper, or a firm.
In-house: pros
- Easier collaboration on strategic projects
- Faster adoption of company culture
- Fewer miscommunications
- Staff can work extra hours when needed
- Full control over skills and fit
In-house: cons
- The real cost is higher than the salary: benefits, bonuses, taxes, equipment, software, training and management time
- A poor fit for small businesses with limited workload
- A gap when the person leaves, since replacing and training takes far longer than a notice period
Outsourcing: pros
- Usually lower cost, since you pay for what you use
- Saves management time
- Scale support up and down with busy and quiet periods
- Access to a team with different skills
- Coverage when someone is absent
Outsourcing: cons
- Outside staff may miss day-to-day communications
- Language and cultural differences can cause misunderstandings
- Dependence on a single individual is a risk. Choosing an established firm rather than a lone contractor reduces it.
How to decide
1. Is the process core to your business? Outsource non-core work so your team focuses on what earns revenue. 2. Do you have time to hire, train and manage staff? If no one has the time, outsourcing removes the burden. 3. What are the full costs? Compare the complete cost of an employee with the fee for the service, not just wages.
For many UAE SMEs, the answer is a firm that handles bookkeeping, VAT and corporate tax filings, with the owner reviewing monthly reports.
See our accounting and bookkeeping service, how to find the right accountant and the importance of bookkeeping.
Key takeaways
- Compare the full cost of an employee with a service fee.
- Outsource non-core work; keep strategic decisions in-house.
- Choose an established firm to avoid single-person dependence.
Frequently asked questions
Is outsourcing cheaper?
Often, because you pay only for the work you need, but compare the full cost of an employee.
Is my data safe?
Ask any firm how it protects your data and who has access.
Talk to a chartered accountant
Questions about your own situation? Reach us directly and we will reply with clear next steps.
This article is general information and not advice for your specific circumstances. Rules and thresholds change, so confirm the current position before you act.
