What You Need To Know About Tax Preparation Outsourcing
Posted by Team QXAS
on 19 February, 2020
As a CPA, if someone asked you which the most difficult period in business is, you would definitely say tax preparation times. In fact, most businesses which have grown beyond the scope of a start-up like to outsource their tax preparation work and consequently CPAs become overloaded by the tome the last quarter of the financial year is reached.
The obvious solution would be to add on a few more employees to the accounting staff but it would also prove to be costly. So what is the alternative; tax preparation outsourcing!
Today there are many such vendors who are efficient, qualified professionals and most importantly they work diligently to ensure compliances with the date of submission and all other statutory requirements as entailed.
But there is more to tax preparation and submission than just hiring a few vendors and dumping the financial data of different companies on these vendors. Thus before finalizing on the vendor, you as the CPA or the Certified Public Accountant should consider certain key points like:
- Keeping the priorities straight: Business accounting involves a lot of functions and hence it is not practical to outsource all of them. You need to set your priorities straight and understand for sure which accounting services you actually need to outsource. Else you would end up spending more on outsourcing than you will actually be getting from the company whose accounts you are handling.
- Knowing the scope and requirement: Outsourcing of accounts and tax preparation services can only prove to be a success if you, as the CPA, know the scope of the work you want to outsource and the specific requirements that you have with regards to the same. This will help you to put forth your requirements, discuss the same with them and then signing on the dotted line.
- Choosing quality over price: There are several vendors claim to offer more services for a lesser price. But as a CPA you are the best judge to understand if they are really offering value. It should also be kept in mind that a good firm would never short-sell themselves and thus when choosing an outsourcing agent, priority should be given to quality at optimum budget.
- Ensuring security: When you outsource, you give third party access to confidential company data entrusted in your care. Thus you need to be extra careful in your choice of the outsourcing firm. Check and cross-check their references and any reviews they put up on the internet. It is also important to check their prevalent data security norms and request them to implement any which you might feel is necessary to maintain the data security of your clients.
- Communication is the key: A vendor or an agent who communicates well and asks subject related questions will definitely turn out to be dependable and honest in his commitment. Thus this aspect should also be taken into consideration before making the final choice of an outsourcing agent.
It is a fact that outsourcing is the need of the hour. And the biggest advantage to outsourcing accounts and tax preparation services is that the costs are invariably lower. Yes, that is sure to bring a sense of relief to a financial expert!