No aspiring accountant in the UK wants to train hard and spend thousands of pounds only to perform manual data entry tasks at work. Yet, small-scale accounting firms in the UK with limited resources are full of such unsatisfied employees. Daily bookkeeping, payroll management, and other such repetitive functions bore them. That’s why larger firms that offer more nuanced work and advanced challenges are able to easily lure these professionals from the smaller firms.
It’s no secret that the small-scale accounting firms in the UK have a serious employee retention problem. Given that the country’s accounting industry is set to experience major technological shifts in the coming years as the administration’s Making Tax Digital (MTD) program comes into effect, now is not the ideal time to be facing employee retention problems.
The Employee Retention Problem for Small-Scale Accounting Firms in the UK
The employee retention issue for small-scale accounting firms in the UK isn’t just down to how many employees leave smaller firms for bigger firms every year. All small business owners are set to experience quantum shifts in how they control their finances. These business owners need to learn how to prepare for the latest digital tax laws. So, the demand among clients for knowledgeable financial advisors who can help them steer through these colossal legislative changes is quite high.
Unfortunately, accountants in many small-scale accounting firms in the UK are still spending too much of their time on basic admin and bookkeeping tasks.
In a recent survey involving over a hundred accountants working with small businesses, it was revealed that –
- Only 2% of the accountants spend their time providing advice to clients on tax affairs or other financial issues.
- 20% of the accountants said they spend most of their time processing basic expenses or correcting basic financial errors.
Should small-scale accounting firms in the UK compel their in-house accounting teams to focus excessively on repetitive tasks like bookkeeping instead of asking them to offer deep insights to their clients? Absolutely not! The pandemic, Brexit, and the Making Tax Digital (MTD) agenda have all come at once for accounting firms in the UK. In such a chaotic period, tasks like processing expenses, reconciling bank transactions, chasing missing information, etc., should not be an accountant’s priority.
However, if small-scale accounting firms in the UK do not accomplish these basic tasks, they can be deemed incompetent by their clients. Thankfully, there’s a solution that allows accounting firms in the UK to do both – address basic day-to-day responsibilities (payroll management, creating financial reports, etc.) and make more time to provide consultancy services. The name of that solution is outsourcing.
Why Outsourcing Makes Perfect Sense
Numerous large-scale accountancy firms in the UK already outsource accounting in India and exploit the lucrative talent pool of Indian accountants. These firms share accounting responsibilities between in-house staff members and their offshore teams. That’s why they’re better prepared to tackle the wave of administrative and legal changes that are set to hit the UK. By outsourcing certain core accounting responsibilities to their Indian partners, these firms are able to give their in-house British accountancy teams more engaging consultancy-related jobs.
Now advanced technologies like cloud-based accounting make it possible for even small-scale firms to create partnerships with talented Indian accountants. Here are a few reasons why all accounting firms in the UK need to create similar partnerships and prepare for the upcoming legislative changes –
- Cost-Effective – No Indian accountant, irrespective of how highly-qualified he or she may be, will ever demand higher salaries than accountants from the UK. Even an entry-level data entry professional from the UK earns more than a Chartered Accountant from India. Now’s the perfect time for small-scale accounting firms in the UK to exploit this currency disparity between the two countries. By outsourcing certain accounting responsibilities to Indian professionals, small-scale accountancy firms in the UK can reallocate their annual budgets and focus more on upcoming legislative changes such as Brexit or the MTD program.
- Automation – The best accounting experts from India use the same automation-based tools that larger accounting firms in the UK use. Be it the latest cloud-based accounting tools like QuickBooks Online or XERO or super-secure private networks that always keep the firms’ financial data safe – the best accounting teams from India have to use highly-efficient virtual accounting tools to stay in business. Using these tools, they’re able to meet all the requirements of their partners in the UK. With real-time access to data, both the in-house team in the UK and the offshore team in India are able to complete important projects on time.
- Employee Satisfaction – Outsourcing to India won’t deter or demotivate in-house employees. Instead, the assistance they receive from their Indian partners will help them focus on higher-quality work. Hence, the amount of satisfaction they receive from their day-to-day responsibilities will also improve.
Outsourcing certain accounting responsibilities to Indian experts is the best and the most cost-effective solution for accounting firms in the UK who aren’t fully prepared for the challenges that are set to come their way!