Why 90% of CFOs Are Outsourcing Financial Operations?

The role of Chief Financial Officers (CFOs) has evolved significantly in the fast-paced financial landscape today. From simply managing company finances, these professionals shape strategic growth initiatives. As a result of this transformation, companies have recorded a sharp rise in outsourcing accounting services. Currently, 90% of CFOs rely on outsourced service providers to manage critical financial tasks. Forward-thinking businesses also hire CFO Consulting Services to manage the growing complexity of accounting regulations.

Why CFOs Are Turning to Outsourcing

CFOs face several challenges, ranging from compliance issues to ever-changing regulations and managing complex financial operations across different regions. Outsourcing accounting tasks has emerged as an efficient strategy to handle these challenges. A study reveals that accounts payable is the most extensively outsourced service, at 65%. Accounts receivable and cash applications are two other commonly outsourced services, at 48% and 31%.

The most common positions that need to be filled with outsourced staff include staff accountants, senior accountants, and tax accountants.

The Key Benefits of Outsourcing

Have a look at the common reasons for outsourcing accounting roles to specialized service providers.

1. Instant Access to Talent

In a fast-paced business environment, companies cannot afford to wait and find the right pool of talent. On average, it takes around 44 days for US businesses to hire the right candidate after posting a job. This implies that other staff need to perform this extra work during the phase, which ultimately compromises the productivity of the company. Even after hiring a candidate, the onboarding process takes up a few weeks.

Outsourcing accounting tasks to experts ensures instant access to talent. This keeps the company productive during the phase and puts it on its growth trajectory.

2. Providing the Right Culture

While attracting talent, companies need to provide the right culture to their staff. Prospects for career development and emotional support prove crucial, which many companies fail to provide.

A survey revealed that 17% of employees prefer working for a company with a positive culture, while 16% and 15% of businesses focus on work-life balance and recognition. With outsourced services, new businesses low on resources can fill their talent deficit in case they fail to hire full-time employees.

3. Cost-Efficiency and Scalability

One of the prime reasons why CFOs are outsourcing accounting functions is the cost-effectiveness it brings. Significant overheads are associated with maintaining an inhouse team of accountants. These include salaries, benefits, training, and software costs. On the other hand, CFOs can reduce these expenses while outsourcing, while providing a more flexible pricing model based on the specific needs of the company.

Also, outsourcing services provide the necessary scalability to businesses. As companies grow, their financial requirements keep evolving. With outsourced services, organizations can easily scale up or down, depending on their current needs. This ensures that they pay only for the services required.

Access to Specialized Expertise with Outsourced Accounting Services

Top outsourcing firms adhere to the latest regulations in the industry. Thus, CFOs can take advantage of this expertise and avoid costly mistakes. In the competitive industry, remaining compliant with financial regulations is a priority.

Established teams providing CFO Consulting Services, like the IMC Group, continue to be the first choice for successful businesses. Deploying cloud-based systems and AI-driven analytics, these professionals ensure the accuracy and efficiency of financial operations. In a world where efficiency and cost-saving measures largely drive success, outsourcing accounting functions has emerged as a vital strategy for CFOs.