How to Hire an Offshore Accountant (and What to Expect)

Should you hire an offshore accountant? For many growing companies, making the decision to outsource comes with numerous considerations, from questioning whether the outsourced accountant will actually save your company money to considering time zone changes and scalability potential.

However, analysis paralysis shouldn’t keep your team from unlocking the power of hiring an offshore accountant. Countless companies see little to no drawbacks and instead realize 24/7 operational coverage, access to specialized global talent, new growth opportunities, and thousands saved in costs.

In this article, we’ll dive into how to hire an offshore accountant, including the key roles and responsibilities of offshore accountants, the pros and cons of offshore talent, and a step-by-step guide to hiring your first offshore accountant.

Before we begin, here are five reasons why offshore accounting has been a key solution for companies:

1. Quick turnaround time

2. Scalability potential 

3. Cost savings

4. Access to global talent

5. Fewer business disruptions

Dive deeper into the top reasons companies engage an outsourcing provider.

Key Functions of an Offshore Accountant

Offshore accountants complete everything an in-house team can, from data entry and payroll processing to financial report preparation and forecasting. One of the main differences is that these professionals work remotely, often overseas. The roles and responsibilities an offshore accountant takes on in your organization depend on your needs. For example, some offshore accountants will handle every aspect of your accounting, while others may work alongside existing team members to complete high-level accounting tasks. Here are some of the key functions of an offshore accountant:

The accounting tasks an offshore accountant completes often overlap with traditional bookkeeping roles. Accounting tasks require a specialized set of skills, which are often outside of the realm of a traditional bookkeeper. Many accountants have the capabilities to perform basic bookkeeping roles alongside their specialized services, like tax return preparation or financial forecasting, making them a great addition to your growing team.

The Pros and Cons of Hiring an Offshore Accountant

When you hire an offshore accountant, you can unlock countless benefits. Let’s explore some of the advantages of onboarding offshore talent in your company.

• Quick Turnaround Time

  Offshore accounting teams, especially accounting firms, have a quick turnaround time on work, helping your business efficiently manage workloads.

• Scalability

  When you hire an offshore accounting firm, you can easily add more team members during busy times, such as around year-end.

• Cost Savings When You Hire Offshore Accounting Support

  Offshoring is cheaper because you aren’t required to withhold payroll taxes, offer benefits, or provide a work environment. This eliminates the significant overhead costs that come with hiring a direct, in-house employee.

• Global Talent Access Through Offshore Accountant Teams

  Looking for remote talent in different countries can open the door to skilled accountants who might not be available locally.

• Fewer Business Disruptions

  When you hire offshore accountants, you have fewer business disruptions. Time zone differences can enable continuous work, resulting in quicker processing and fewer delays.

While these benefits certainly outweigh the disadvantages, let’s cover a few of the top concerns when hiring an offshore accountant and how you can alleviate them:

• Communication Barriers

  Since offshore accountants are often remote professionals from different countries, you may encounter communication barriers. However, using multiple forms of communication, such as text, email, and video calls, can eliminate this challenge.

• Data Security Risks

  Protecting the sensitive information of your company is important. Hiring an offshore accountant means you are potentially exposed to added risks. Reducing data security risks can be done by thoroughly vetting your outsourced accountants, having clear contractual agreements, and using multi-factor authentication.

• Cultural Differences

  Your offshore team may have cultural differences compared to your in-house team. Taking the time to explain these differences to your team members can foster respect and promote a positive work environment.

• Loss of Control

  Giving up control of your accounting function can be difficult. However, it’s important to keep the long-term benefits in mind, such as the ability to unlock new growth goals or streamline your accounting processes.

Both the pros and cons need to be considered when hiring an offshore accountant. While there will be trial and error, many of the cons can be easily overcome with the right due diligence and perseverance.

Step-by-Step Guide to Hire an Offshore Accountant

Now that we’ve covered the basics of offshore accounting, including the pros and cons, let’s go through a step-by-step guide to hire an offshore accountant in your company.

1. Understand Your Needs

   The goal of hiring an offshore accountant is to build a lasting partnership. Oftentimes, business owners aren’t seeking offshore talent for one-off projects. Instead, they are looking to hire offshore as a permanent solution. The first step to successfully hiring an offshore talent is to understand your needs.

   Are you looking for accounts payable and receivable help? How about assistance with filing tax returns or managing the financial data workload in your company? It can be helpful to ask existing team members where they need help. You might be surprised to find that most of your team members have an excessive workload and are looking for assistance.

2. Determine Skill Requirements Before You Hire an Offshore Accountant

   Based on the needs you listed above, determine the skill requirement for your offshore accountant. Do you just need bookkeeping, or do you need a specialized skill set, like financial reporting? Identifying your skill requirements will help you vet the right talent.

   When evaluating your skill requirements, it’s also important to consider whether you need one offshore accountant or the expertise of an entire accounting firm. For example, if your business has enough accounting tasks for a team, you might consider working with an offshore accounting firm. Not only can this give you flexibility in workload management, but it also avoids the need to continuously onboard new professionals.

3. Choose a Hiring Model

   Next, you want to choose a hiring model. Will you hire offshore accountants directly, or will you work with a service provider? Service providers often have a pool of pre-vetted outsourced accounting professionals. This can be beneficial if you prefer to have an external party to facilitate the vetting process on your behalf.

4. Choose the Right Provider

   The next step in hiring an offshore accountant is to select your provider. This step will be the most time-consuming, as it will require you to go through a detailed vetting process. Even if you choose to work with a service provider, you will need to vet the company and their talent pool. Here is what to look for when vetting your provider:

   • Language

     Language barriers are potentially one of the top disadvantages to outsourcing accounting. Verify what countries your remote team is coming from.

   • Expertise

     When you hire offshore accountants, you want to be sure their expertise matches your business needs. Verify that they have the capabilities to handle and the background knowledge to complete the tasks you need done.

   • Culture

     While cultural barriers can be overcome, it’s important to know what differences your offshore partner may have.

   • Certifications

     Certifications are important. For example, if you need help during tax season, your offshore partner should have the credentials to file income tax returns. Other certifications, like those from your specific accounting software, can also be beneficial.

   • Technology

     Data security can be a concern when outsourcing. Inquire about their tech stack and what data security protocols are in place to protect your information.

   • Service Quality

     You want your offshore accountants to be an extension of your in-house team. This means that the service quality should match or exceed your expectations.

   • Management

     Understanding how your offshore team will be managed is another essential consideration during the vetting process. The right management can lead to a lasting partnership when you hire offshore.

   • Costs

     The costs of hiring offshore accountants should be evaluated during the vetting process. Remember, the more specialized services you choose, the higher the expected cost. For example, financial data entry will cost less compared to financial statement preparation or cash flow management. Evaluate the hourly rate in relation to the benefits you receive.

5. Onboard and Train After You Hire an Offshore Accountant

   After you have all of the details worked out and have selected your provider, it’s time to onboard and train your offshore accountant. Many service providers perform this task on your behalf, which is one of the top advantages of working with them. However, if you choose to hire offshore accountants on your own, the responsibility of onboarding and training will fall on you. Your training protocols should be comprehensive and cover your expectations, including anticipated deadlines.

6. Measure the ROI

   Once your offshore accountant has been integrated, it’s important to measure their effectiveness and your return on investment. To measure the ROI of your offshore team, subtract the cost of outsourcing from the total gains from outsourcing and divide that number by the cost. In many cases, it can be difficult to assign a value to non-financial gains, such as completing reports two days sooner or collecting cash flow five times quicker. This can cause your ROI calculation to be lower than reality. Nevertheless, if you notice that your ROI is low, there are a few different strategies you can implement to optimize performance, including:

   • Revisit Goals – Defining clear goals will be crucial to aligning actions with expectations. 

   • Re-Train – Re-training your offshore team might be what is needed to maximize ROI. 

   • Adopt New Technology – The tech stack in your business matters. Review your current tools to find areas of improvement. For example, maybe you need a new communication platform to eliminate time zone differences. 

   • Ask for Feedback – It can be difficult to know where you can improve without asking the people on the frontlines. Ask your remote team where you can improve.

Now that you have the steps to hire an offshore accountant, explore the broader landscape of outsourcing in our complete guide to outsourced accounting.

Summary

Is it time for your company to hire offshore accountants? Bringing offshore accountants to your team can infuse flexibility, cost savings, and growth opportunities into your business.

At Personiv, we specialize in building dedicated offshore accounting teams that act as a true extension of your own. If you’re ready to explore our flexible outsourcing solutions and see how a custom-built team can transform your financial operations, we’re here to help.