Outsource accounting works: should or should not?


Why should businesses hire accounting services and tax services

Currently, many Vietnamese enterprises, especially small and medium enterprises (SMEs) are hiring qualified accounting/tax service firms to record books, prepare financial statements, tax declaration, tax finalization and minimizing accounting risks as well as reducing expenses instead of recruiting and training personnel for the accounting department of company.

The reason is that businesses have seen practical benefits when using accounting services and tax declaration from reputable and professional accounting firms. In fact, this is also the general trend of countries in the world (Japan, China and European countries ... applied from many years ago). Most businesses choose to outsource because they ensure professionalism and achieve economic benefits.

In order to be able to maintain an accounting staff to perform accounting works, businesses have to pay many expenses such as: Direct expenses (Salary, Social insurance, health insurance, benefits such as bonuses…) and training costs, etc. The larger the number of employees, the greater the costs incurred. In addition, there are additional expenses for business management to serve such as: office rent, depreciation, electricity and water costs, ... the cost of management is often many times higher than salary costs of employees.

Thus, just a small calculation, we can see that the cost of maintaining an accounting team in SMEs is quite large and not really optimal for businesses. Meanwhile, if you hire external tax accounting services, businesses only have to pay less than 35% -50% of this cost and feel secure about service quality.

In addition, the quality of accounting services and tax declaration from professional and reputable service providers will be better than an internal accountant of the Company for the reason of she having to do too much in the SME business and may be inexperienced in dealing with tax issues. In fact, in Vietnamese small and medium enterprises, the employed accountant often does not have sufficient experience, does not have a firm grasp of the professional expertise to undertake the entire accounting work. Meanwhile, accounting and financial management tools can only be effective when it is done on a basic accounting foundation and must be done in a complete, timely and accurate manner and obey the law. This can only be done if there is a professional accounting system that is properly implemented and has a standard and strict procedure (Applies to large companies, corporations...).

Thus, many small and medium enterprises, when newly established, immediately consider hiring accounting services from reputable companies to save costs and limit accounting risks and tax costs. Obviously, this is a suitable and smart choice.

Currently, tax/accounting services are increasingly developing in Vietnam and in the future, this is considered a practical and appropriate choice for businesses. Enterprises also no longer have to worry about the hiring of tax/accounting services will leak information, disclose business secrets because the accounting service companies are committed to confidentiality by contract and take responsibility according to the provisions of the service contract. In addition, the accounting service companies that are eligible to practice must comply with professional accounting ethics, are periodically checked and assessed by the Ministry of Finance. Therefore, businesses are guaranteed of maximum benefits and business information.

Obviously, if the cost of outsourcing the job is lower than the cost of maintaining the accounting staff and the quality is still better, there is no reason why the business should not consider outsourcing. This is true for all fields, not just limited to corporate accounting ...