It’s no secret that Australia is experiencing a significant shortage of skilled accountants and finance professionals. In fact, for many Australian businesses, outsourcing accounting and finance offshore is not a choice, but the only viable way forward to keep pace with operational demands within a financially sustainable budget. With the advent of cloud accounting and remote working, accessing skilled offshore accounting and finance talent is more accessible than ever. However, choosing the best country to outsource accounting, bookkeeping and finance can be a challenge.
Traditionally, countries like India and the Philippines were popular and well-established outsourcing destinations. However, emerging alternatives such as Sri Lanka are becoming increasingly attractive thanks to a talent pool of skilled accountants, compatible cultural values and competitive costs.
Which bring us to the key question – which country is the best for outsourcing your finance and accounting functions?
Well, there’s no definitive ‘best country’ because one size doesn’t fit all.
There are many factors to consider if you want to make your finance and accounting outsourcing experience one that meets your business’s operational demands without compromising quality:
- Operational and Workforce costs: Cost efficiency is one of the most popular reasons to outsource any operations offshore. Regions like South and Southeast Asia have been known to offer significantly lower wages costs in comparison to hiring locally within Australia. However, it is essential to balance this affordability with quality of work and communication skills.
- Access to Skilled Accounting Talent: A critical deciding factor is the talent pool available in each country. Does it produce qualified accounting professionals with the skills and certifications to meet your requirements? Australian businesses, for instance, may require offshore accountants that have been trained in Australian bookkeeping, tax laws and accounting standards.
- Time Zone: Depending on your work, you may prefer a team of offshore accounting professionals that either works according to Australian working hours, or one that enables you to extend office hours.
- Ease of Communication: Countries boasting high English proficiency are preferable for easier communication with offshore accountants, with nothing being misunderstood or lost in context. For this reason, it is smart to identify offshore accountants based in countries that have similar cultural values and whose business practices tend to follow your own.
- Infrastructure and Economic Stability: Stable internet and power are the bare minimum for long-term outsourcing success. It is also important to note that local transport and infrastructure can help offshore accountants travel to and from home and maximise their productivity.
Considering these key factors, India and the Philippines are undoubtedly the first names that come to mind in terms of offshore operations, but countries such as Sri Lanka and Vietnam are rapidly becoming more established and compelling alternatives.
India:
India’s biggest strengths are the reputation and infrastructure that has neem built over many decades as an outsourcing hub for a range of industries, in particular IT. And being the world’s most populous country, India boasts a vast pool of talented professionals in all industries, including accounting.
Strengths
- Longstanding hub for outsourcing solutions, with well-established infrastructure.
- Vast population increases the accounting talent pool available to the outsourcing sector.
- Due to the mature outsourcing talent pool offshore accountants are used to dealing with foreign clients and working to global standards as expected by Australian businesses.
Challenges
- Large country with below standard transportation infrastructure makes it challenging to choose the right location within India to source offshore accountants.
- Time zone differences may limit real-time collaboration with Australian teams.
- High demand for top talent and competition among outsourcing providers and has resulted in significant cost increases in recent years.
- Possibility of incompatible cultural setting and language barriers to working alongside Australian accountants in Australian businesses.
India is a solid choice for large organisations with complex financial operations requiring advanced technical skills and expertise in international accounting standards.
Sri Lanka:
While India and the Philippines remain the go-to countries for large-scale outsourcing, Sri Lanka is fast-emerging as a boutique hub for accounting and finance outsourcing.
This is largely driven by the country’s strong accounting education system favouring CA, ACCA and CIMA certifications. This, paired with excellent English proficiency and an easy going and trustworthy culture amongst the finance community.
Strengths
- Highly skilled accountants with training in international standards and capable of being trained in Australian bookkeeping, tax and accounting requirements.
- Small country with offshore accounting talent concentrated in Colombo and surrounds.
- Competitive cost structure that compares favourably to India and the Philippines.
Challenges
- A smaller workforce and overall talent pool compared to India or the Philippines.
- Still building global recognition as a premier outsourcing destination.
- Government and political party changes can give rise to disruptions.
Sri Lanka is the choice for Australian businesses and accounting firms that want quality output and cultural alignment. The country offers well-trained offshore accounting talent, delivering cost-effective solutions without compromising quality.
The Philippines:
Like India, The Philippines has enjoyed much success in the outsourcing industry due to strong English proficiency amongst the general population, alignment with Western business practices, and a large pool of qualified finance professionals.
Strengths
- Widely recognised as having the best English proficiency in Asia, which simplifies communication.
- Skilled professionals familiar with Australian business practices and accounting standards, making it ideal for Australian businesses and accounting firms.
- A strong customer-service orientation and culture based around service to others makes offshore accountants in the Philippines well suited to client-facing finance roles.
- The time zone is well suited for Australian businesses who wish to maximise collaboration time with local teams and operations.
Challenges
- Higher salary expectations compared to countries like India, Vietnam and Sri Lanka.
- Excessive competition for top offshore accounting talent with numerous outsourcing and BPO companies servicing Australian businesses competing for the same talent.
- Prone to natural disasters, which can occasionally disrupt operations.
The Philippines is great for companies that require client-facing teams with excellent communication skills but are willing to accept higher staff turnover and competition for top finance and accounting talent.
Vietnam:
Vietnam is still relatively new to the finance and accounting outsourcing landscape due to their relatively weak English language skills and limited talent pool with knowledge of Australian-specific bookkeeping, tax and accounting requirements. This is offset by their extremely competitive workforce costs.
Strengths
- Extremely competitive labour costs.
- A nascent outsourcing industry with potential for expansion.
- The time zone is well suited for Australian businesses who wish to maximise collaboration time with local teams and operations.
Challenges
- Limited understanding of Australian specific tax and accounting practices.
- Relatively weak English communication skills, which may pose hurdles in client interactions.
Vietnam is a viable option for businesses with basic accounting needs at minimal costs, however, more established destinations may better align with complex accounting needs. With growing government support for outsourcing, Vietnam may have more to offer in the years to come.
Note: With all the countries mentioned above, working with institutions based in commercial capitals is key with regard to infrastructure and access to skilled talent.
Offshore Accounting Tailored to Australian Business Needs
Choosing the right country is just one piece of the puzzle. To get the best outcome from outsourcing finance and accounting, it’s crucial to have a reliable on-the-ground partner overseeing operations, conducting regular training on Australian-specific accounting and tax, and bridging communication gaps. That’s where partnering with a trusted outsourcing partner makes all the difference.
- Choosing the right outsourcing partner is as important as selecting the best country to outsource finance. It is critical to identify a reliable partner that can provide: Extensive knowledge in Australian tax laws, accounting standards and software systems.
- Accountants well-versed in Australian business culture and dynamics.
- Regular performance reviews and revisiting QA processes, ensuring top-tier quality throughout your offshore outsourcing experience.
- Stringent data security protocols and compliance with Australian privacy regulations.
- A proven track record of client retention and testimonials.
Outsourcing accounting offshore provides a practical way for businesses to cut costs, access skilled talent, and scale operations without sacrificing quality. While India and the Philippines are well-established destinations, emerging markets like Sri Lanka present an equally robust, cost-efficient alternative for Australian companies.
If you’re considering offshore accounting and want tailored solutions that prioritise Australian-trained accountants, then, S&B Private can help you integrate skilled offshore professionals into your team seamlessly and prevent the key pitfalls with traditional outsourcing.
Learn how outsourcing can transform your finance function or accounting firm. Book a discovery call with S&B Private today to build a top-tier offshore accounting and finance team with oversight, training and support from local Australian accounting practice owners. Build capacity, reduce costs, and future proof your operations today.