Pros and cons of outsourcing accounting works

Hiring external accountants bring many benefits and efficiency in work for each business, so the need to use accounting services is more and more popular and becomes an effective solution for every business today.

Benefits of hiring external accounting services

Using external accounting services, your business will receive the following benefits:

Use highly qualified and professional accountants: Nowadays, recruiting personnel is extremely difficult, especially for a position that requires high expertise and requires both discipline and ethics in the profession like accounting. Therefore, when using outsourced accounting services, it is obvious that you will be using personnel with high professional qualifications and ability to handle problems professionally and quickly. Moreover, they always update with the latest changes in the industry to assist you in all situations, help maximize the interests of the business and comply with the regulations of the state.

Ensuring efficiency at work, minimizing risks: High professional capacity, professional working attitude from service accountants will help you feel secure about efficiency in work. Moreover, the service accountant is fully responsible for the records and documents. So, you can completely trust and feel secure to do and run your business. All matters related to accounting - tax or legal has an accounting service unit to support.

Save time and costs: When using tax/accounting services, you will save a lot of time in handling work, especially arising problems will be supported quickly, accurately and professionally. The cost of using accounting services is calculated on the volume and efficiency of the job. This cost is always a lot cheaper than you recruit an accountant and invest in equipment to work for them at the company. Therefore, the hiring of external accountants is extremely suitable for small, newly established businesses.

Solve problems quickly and professionally: With high expertise and diversified experiences, outsourced accountants become masters in problem identification and handling to ensure efficiency and quickness for business. With difficult transactions, they also have solutions or consultation with teammates in the profession to provide the best solution for the business in each specific situation.

There are personnel representing enterprises to work with state agencies: It is certain that the problems of explaining and presenting documents of enterprises with state agencies and departments are inevitable. When using external accounting services, you are completely assured of their professional capacity as well as the ability to grasp, solve and explain problems with agencies, to ensure compliance with the law and regulation.

Limitations of hiring external accountants

Not present regularly in the enterprise, therefore, not close to the job as an internal accountant
Only perform accounting and consulting services as predefined scope of work under the contract

However, the above limitations can be mitigated by the following solutions:

Select companies that are reputable and have sufficient resources and personnel to do the job
Discuss frankly with the service providers about the above limitations and suggest them to have suitable solutions.

Which business should hire accounting services

Today, the hiring of external accounting services is the first choice of businesses, especially:

Newly established businesses:

Newly established and start-up businesses do not have many employees, and have no accountants.
Businesses need someone with accounting expertise to perform accounting operations and help you solve problems or difficulties in making initial financial statements and declaration.
Businesses need advice on tax-related decrees or regulations and financial statements that could not be understood at the outset.

Foreign businesses:

Foreign-owned and foreign-invested enterprises are doing business in Vietnam but are not familiar with the Vietnamese regulations.
Foreign businesses are in need of advice on legal documents to open a business in Vietnam.

Businesses are in operation:

Small and medium-sized enterprises, arising costs, few documents, not yet have a full accounting department.
Enterprises are looking to streamline human resources and save costs.
Businesses need professional representatives to work with tax authorities.
Or businesses need to deal with and solve problems related to: Accounting Law, circulars, decrees, accounting standards, taxes ... in order not to be penalized.
Enterprises need advice on paperwork and corporate legal.

What are detailed works of outsourced accounting service?

Outsourced accountants will be like another accountant, they will also perform the full required work of an accountant. Depending on each outsourced accounting service of the business, however, there will be specific jobs.

Outsourced accounting services work is usually divided into periods such as: at the beginning of the year, daily, monthly, quarterly and at the end of the year. At the end of the quarter, the end of the year, the workload is the most. As follows:

The work at the beginning of the year that the accountant needs to perform:

Declare and pay the tax at the beginning of the year: For the license tax is January 31 each year. If the business is newly established, the license tax and declaration form is submitted within 1 month from the date of obtaining the business license. If the company has a change in capital, the deadline for filing a license tax declaration is December 31 in the year that changes.
Corporate income tax return for the 4th quarter of the year preceding the year of the tax return.
Report on the use of invoices in the 4th quarter of the preceding year.
Submit financial statements, CIT finalization, PIT finalization of the preceding year: The deadline is March 31.

Normal daily work:

Recording, collecting and archiving invoices and accounting vouchers.
Collecting and processing all invoices and documents related to the output and input of the business if there is any sale and purchase activities, for tax declaration and accounting at the end of the month.
Check whether the invoice is legal and appropriate or not? If there is any wrong or unreasonable case, it is necessary to immediately handle it according to the provisions of the Circular and relevant documents.
Make clear declaration of receipts and payments, issue sales invoices, release notes ... every day if any.
Record other necessary related records

Monthly work:

Make monthly VAT declaration (if the business registers to declare VAT monthly).
Make monthly PIT declaration (if the enterprise registers to declare VAT monthly and has the PIT payable in the month).
Declaring other taxes (if any)
Make reports on monthly invoice usage (for newly established businesses less than 12 months)
Deadline for filing is the 20th of next month.
Make reports on goods, inventory and monthly revenue of the business.
Calculate the product cost, raw material cost … (if any)

Quarterly work:

Make quarterly reports on the use of Invoices. Prepare quarterly PIT reports (If the business registers to declare quarterly). The deadline for submitting the declaration is the 30th of the first month of the following quarter.
Quarterly report on business results and cash flow.
Reporting goods, inventory ...
Check and track tools and equipment and record expenses, losses for businesses.

Year-end work:

Make tax reports for the last month of the year and tax reports for the 4th quarter.
Prepare annual PIT finalization report for enterprise.
Declare funds, inventory and assets, reconcile liabilities.
Complete accounting books, comparing detailed books and general books.
Preparing annual financial statements including: Balance Sheet, Profit & Loss Statement, Cash flow Statements.
List the relevant accounting records and vouchers and get them signed.
Prepare related declaration such as corporate income tax, personal income tax
Perform the work of accounting, declaring value added tax, corporate income tax, personal income tax for employees ... final declaration at the end of the year according to regulations.
Handling problems that arise.