The practice of outsourcing accounting services to offshore teams is on the rise. The accounting profession faces a talent shortage fueled at both ends: the graduate pipeline of new recruits is dwindling even as experienced CPAs begin to retire. Today businesses are turning to outsourced offshore teams to lower costs while meeting their accounting needs. 

In addition to solving the talent shortage, offshore accounting teams let businesses encounter a deep pool of talent not previously accessible. Organizations are able to adapt to changing workloads and take advantage of the overnight capacity of offshore teams to deliver fast results. The result is an expanded operational flexibility that also lowers costs. It’s an efficient solution, but it’s not hazard-free.

Offshore Teams Are an Efficient Solution, But Not a Perfect Solution

There are potential risks associated with offshore accounting services. Offshore teams might not be fully versed in recent amendments to U.S. tax and audit compliance standards. A dearth of direct supervision might lead to missed opportunities for improvement, or worse, errors that require time-consuming fixes down the line. 

Continuity is another critical issue for tax and audit firms. When firms and offshore teams work in different jurisdictions and time zones, small gaps in communication can have outsized consequences, especially when tax and audit compliance is at stake. 

The key to successfully using offshore accounting services is to provide precision U.S.-based oversight. A strategic blend of on- and offshore talent results in reduced costs, seamless compliance and streamlined workflow. 

Offshore Accounting With Onshore Insight: How Fractionals Managers Optimize Collaboration

Having a U.S.-based manager oversee offshore accounting teams is the best way to ensure all deadlines and compliance needs are met. Trained in U.S. standards, with immediate access to U.S. tax and audit resources, an onshore manager is strategically positioned to steer the work of an offshore team.

Given the CPA shortage, that manager does not need to be a full-time, in-house position. A fractional senior accounting manager is an innovative—and cost-effective—solution. 

If your business is looking to blend onshore expertise with offshore throughput, a fractional senior accounting manager is an excellent complement to harness the full potential of an offshore accounting team. Despite having an additional part-time hire, an onshore senior manager can improve profitability, productivity and client experience in key ways:

  • Workflow efficiency: With global oversight, a factional manager optimizes efficiency by assigning tasks to the best-suited location or team member, eliminating wasteful redundancies to save in both time and costs.
  • Continuity: Supervision of the entire project lets the fractional manager oversee all the details, ensuring consistency from site to site and team to team.
  • Quality assurance: The fractional manager’s wide view not only prevents costly errors but also provides confidence that all compliance requirements are met.
  • Tax strategy: Their breadth of understanding can uncover tax efficiencies or tax opportunities, leading to substantially more value for your clients.
  • Advisory capacity: Having a fractional financial manager in place to oversee offshore teams also frees up domestic accounting leadership to ask questions, make recommendations and offer client advisory services that will ultimately grow the business. 
  • Specialized expertise: Rather than a full-time role, the fractional manager offers niche expertise in compliance, technologies, controls, etc. that would be cost prohibitive on a full-time basis.
  • Lower recruitment costs: Compared to continually recruiting for niche domestic accounting roles, a fractional model is more affordable access to expertise.

Best Practices for Effective Onshore-Offshore Workflow

As with offshore accounting teams, fractional financial managers lower overhead while giving businesses access to specialized expertise. These financial experts are chosen to fulfill specific needs, from ensuring compliance to establishing continuity of purpose and process. They’re also effective at managing offshore accounting teams. 

Committed to the business but not embedded, fractional financial managers optimize collaboration between onshore and offshore teams by:

  • Defining objectives: Setting benchmarks, standards and timelines for deliverables to keep all team members on track.
  • Tracking performance: Implementing quantifiable targets around output volume, task cycle times or quality scores to measure and improve team efficiency.
  • Standardizing and implementing tools: Spearheading integration of essential accounting and automation tools, documenting SOPs and ensuring teams use the same tools across the board.
  • Cross-training teams: Identifying skill gaps and building a shared understanding of critical tasks to safeguard performance, even in unusual situations.
  • Creating redundancy plans: Establishing criteria to ensure a smooth transition after peak work periods. Based on team members’ strengths, the manager tiers and delegates different functions optimally.
  • Risk-based sampling: Selecting batches to review assures operational quality. 
  • Analyzing outputs: Analyzing performance, bottlenecks, etc. and surfacing process improvements for the future.
  • Facilitating collaboration norms: Putting in place communication rhythms or status update cadences that connect onshore oversight with offshore production seamlessly.

Tax and audit firms aim to be as cost-effective as possible. Offshore accounting teams lower overhead and free up both resources and bandwidth for client advisory service initiatives. But with compliance at stake, offshore teams need to be de-risked. The answer is a U.S.-based manager to ensure compliance standards are met.

Paro gives you access to U.S. financial experts with senior-level experience. 

Accounting managers with five to 15 years of experience aren’t easy to find, but our on-demand staff augmentation services make the right match for managing offshore teams and increase your capacity. Schedule a consultation to learn more about our staff augmentation services.