We all know that Business Process Outsourcing or BPO is now an accepted practice in many businesses these days. Even micro entrepreneurs have turned to BPO companies with the intention of acquiring quality service without having to spend too much time, money and effort on acquiring it.
BPO services range anywhere from booking flights, to web development, to information technology enabled services or ITES, etc. Some popular examples of ITES include medical transcriptions, back-office accounting, company financing, some aspects of telecommunications, insurance (i.e. insurance claims and inquiries,) credit card processing, and many more.
Accounting / Financing Outsourcing
BPO companies offering accounting processing provide valuable service to many of their patrons. It should be noted that in some instances financing and accounting services among BPO companies almost always work as one. Accounting / Financial experts from these aforementioned companies provide their clients with accurate and timely financial information; not to mention analysis critical to strategic decision-making functions. Of course, the main objective of the BPO companies is to provide exactly the services its clients ask for, including possible work in one or two transacting areas such as accounts payable processing, account reconciliation and analysis, billing and collections, cash application, financial and operational reporting, fixed asset accounting, general accounting, project accounting and vendor management.
Although these aforementioned services are generally the crux of what BPO companies provide, they are not limited to these. Some companies have more specialized needs and the BPO company that can best adapt itself to its customer is by far, the leaders outsourcing in the race.
A good example of specialized needs is the introduction of accounting and financial assistance in schools and universities. Educational institutions from different countries are now seeking BPO companies to handle the bulk of their financing and accounting workloads. Outsourcing processes can cover electronic processing of alternative funds certification, disbursements or refunds, lender follow up, loan follow up, loan certification, and title grants, to name a few.
Short term contracts among BPO companies and clients cover wide areas of finance and accounting; and these short term contracts seem to be more popular among clients than long term ones. Some of the contractual short term services include: account balancing, account reconciliation, audit support, financial analysis, financial reporting, policy and procedural documentation, process assessment, process re-engineering, Sarbanes Oxley compliance, transaction processing efficiency review, etc.
Part of accounting work of course, entails a great deal of book keeping; and some of the most primary areas of book keeping include: accounting data entry, accounts receivables, accounts payables, auditing, bank reconciliation, preparation of ledgers, and the preparation of financial statements.
On A More Detailed Note
On a more detailed note, some clients may prefer to know what exactly will they be getting when they hire BPO companies to do their accounting and financial workloads. It should be noted that discretion and privacy are two of the greatest elements offered by successful BPO companies, beyond that, accuracy and timeline follows a close second.
Here is a more detailed look as to the general idea (but certainly not limited to this alone) that covers accounting and financing outsourcing services.
With accounts receivable, services may include: bank advice clearance, client billing, client settlement, correcting encoding errors, and suspense clearance. With accounts payable, services may include: bank payment entries, bookkeeping, cash allocation, cash application, cash payment entries, credit balance refunds, credit card accounting entries, journal entries, payment research, statutory dues, and third party settlement. With accounts reconciliation, services may include: assets and liabilities, bank, branch accounting, general ledger and third party settlement.
With reporting and analysis, services may include: financial statement analysis and statutory reporting. With payroll processing, services may include: Form 940 federal unemployment tax return, Form 941 federal tax return, general ledger posting report, next day processing, quarterly local tax return, quarterly state unemployment tax return, W-2 Forms for all employees, W-2 state withholding recap, W-3 federal withholding recap, and year end local tax reconciliation.