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Building an Offshore Accounting Team – Are You Ready for These 13 Key Steps?

by | Jun 4, 2024 | Outsourcing

Offshoring accounting services may sound daunting, but consider the journey of Vista Investments, an Australian investment management firm poised for expansion. 

Co-founder Ava Jackson recalls their initial concerns: “Will new staff uphold our values remotely? Can we trust their diligence and data security?” 

These fears quickly dissipated during their discovery process in India. Upon visiting, they were struck by the sophistication of operations— from strong security measures to cutting-edge technology, surpassing their local standards. 

This revelation underscores a vital point: Offshore accounting, particularly from the U.S. to India, is viable and can be a linchpin for secure, efficient growth. If you’re a nimble startup or a well-established enterprise, offshoring can catapult your company’s expansion and streamline operations. 

Here, we’ll unveil key steps to building a reliable offshore accounting team so your business thrives globally.

1. Chart Your Course

Starting your offshore journey begins with charting your course. It’s important to ask yourself what you aim to achieve by offshoring. Defining your business needs and objectives early helps align your strategy with overall business goals.

For instance, consider an accounting firm planning to offshore part of its operations to manage seasonal fluctuations more effectively. 

By offshoring routine tasks such as tax preparation or payroll processing, the firm reduces operational costs and allows its domestic team to focus on higher-value activities like client advisory services and strategic financial planning. 

2. Define Your Location

Choosing the right location is critical in setting up your offshore team. This decision should balance cost, talent availability, political stability, and economic conditions. 

For example, India offers a significant advantage in accounting and IT services due to its large pool of skilled professionals and cost-effectiveness. Ask yourself if the location supports your operational requirements and provides a stable environment for business. 

Evaluating these aspects ensures that your chosen destination optimally supports your offshoring goals.

3. Choose Your Champion

Selecting the right offshoring model is crucial, particularly when considering a powerhouse like India—a prime destination for U.S. companies looking to offshore. India’s appeal lies in its cost-effectiveness and its pool of highly skilled professionals specializing in financial and real estate accounting. 

For U.S. businesses, this translates into access to top-tier talent and advanced technologies at a fraction of domestic costs. Consider India’s proven track record when deciding whether to partner with a local provider. A local partner in India allows U.S. companies to maintain stringent control over operations. They ensure compliance with both local and international standards. 

Alternatively, partnering with an established Indian firm can provide immediate access to specialized skills and local market knowledge, which is crucial for seamless integration and scalability. 

4. Set the Bar

After selecting your offshoring location and model, it’s essential to establish clear goals and expectations. This involves defining success for your offshore team, such as achieving specific cost reductions, improving turnaround times, or enhancing the quality of financial reporting. 

By setting precise, measurable objectives, you provide your team with clear direction and establish benchmarks for performance evaluation. 

Consider how these goals will integrate with your broader business strategies and what metrics you will use to measure success. 

5. Scout the Right People

The success of an offshore operation heavily depends on the quality of the team you assemble. 

When offshoring accounting services, prioritize finding personnel with the right mix of skills and expertise. This includes proficiency in U.S. accounting standards, familiarity with international financial regulations, and communicating effectively in English. Domain experience and industry knowledge do come in handy for building fast-track teams.

Recruiting the right team also means considering cultural fit and the ability to adapt to your company’s work culture and ethics. What qualities and qualifications are most critical for your team, and how will you ensure these are prioritized in the recruitment process? These are some basic questions you need to ask yourself at this stage. 

6. Task Tailoring

Clearly defining the tasks and responsibilities assigned to your offshore team is vital for operational efficiency and accountability. 

This step involves mapping out each process that will be handled by your offshore team, from routine bookkeeping to complex regulatory compliance tasks. Specify which tasks require deep expertise, such as tax strategy and financial analysis, versus those that are more procedural, like data entry or transaction coding. 

Creating detailed job descriptions and workflow diagrams can help align the offshore team’s efforts with your company’s standards and expectations. Additionally, this clarity helps set up effective training and onboarding programs to ensure every team member understands their role and how it contributes to the company’s objectives.

Documenting these rules helps prevent misunderstandings and ensures that your team operates in a way that aligns with your company’s values and legal requirements. 

Furthermore, consider integrating local regulations (for example, India) with your internal policies to effectively address legal and cultural differences. An example to think about is how you will handle data privacy, particularly with the stringent requirements of both U.S. and Indian laws. What protocols will you establish for compliance, and how will you communicate these to your team?

7. Secure the Safe

Security, particularly data security, is a critical concern when offshoring sensitive accounting functions. 

Begin by asking: What measures will you implement to protect confidential data? How will you comply with data protection regulations for both the U.S. and other countries? How will you monitor and enforce these security protocols remotely? Addressing these questions helps craft a commendable security strategy that safeguards your data against breaches and ensures compliance with international standards. 

For instance, encrypting data transmissions, conducting regular security audits, and requiring stringent access controls can be effective safeguards. 

8. Measure the Milestones

Tracking your offshore team’s progress and performance is essential to meet your outsourcing objectives. 

This can be achieved by setting up key performance indicators (KPIs) related to efficiency, accuracy, and timeliness. Regularly measuring these milestones will help you to see where adjustments may be needed and aid in reinforcing successful practices. 

For instance, if your financial reporting tasks are being managed offshore, you might track metrics such as the error rate in financial statements and the time to close monthly books. Review these measures frequently to assess whether your team meets the expected standards, and consider regular feedback sessions to discuss these outcomes.

9. Identify Functions for Remote Management

Determining which functions can be effectively managed remotely is pivotal in optimizing the performance of your offshore team. This involves analyzing your business processes to identify which tasks can be handled without compromising quality or security. 

Generally, transactional and repetitive tasks such as payroll processing, accounts receivable, and general ledger maintenance are well-suited for remote management. However, more strategic functions, such as financial planning and analysis, might also be offshored, provided you have the right talent and communication tools.

10. Partner Profiling

This “Partner Profiling” step should include evaluating the potential partners’ track records, expertise in your industry, scalability, and alignment with your business ethics. It’s also important to assess their technological capabilities and their security measures, especially if they will handle sensitive financial information. 

Conducting site visits, reviewing client testimonials, and verifying their compliance with international standards can provide deeper insights into their operational effectiveness.

11. Communication is Key

Effective communication is the cornerstone of any successful offshore operation. 

At this stage, consider crucial questions: How will you ensure clear and consistent communication across different time zones? What tools and technologies will you use to facilitate daily interactions? How can you build a culture of openness and trust remotely? By answering these questions, you establish a framework for seamless information exchange. 

Good communication channels bridge the geographical and cultural gaps and boost team morale and productivity. For example, implementing regular video calls, using collaborative project management software, and establishing clear protocols for updates and reports can significantly enhance understanding and efficiency. 

12. Monitor and Mentor

Monitoring performance and providing ongoing mentoring are essential to maintaining the quality and improving the efficiency of your offshore team. 

At this stage, consider how you will track and evaluate the performance of your offshore operations. What metrics and benchmarks will you use? How will you provide feedback and coaching to boost improvement? 

Integrating continuous monitoring with regular mentoring sessions helps identify areas for improvement while promoting professional development among team members. 

For example, setting up monthly review meetings to discuss performance metrics, celebrate successes, and address any issues can motivate the team while ensuring they remain aligned with your business goals. This approach enhances operational efficiency and helps build a loyal, skilled workforce committed to your company’s success.

How Does EXO Edge Lead the Pack in Offshore Accounting?

As we’ve explored throughout this blog, setting up an effective offshore team hinges on strategic planning, diligent partner selection, good communication, and stringent security measures. Among numerous global players, EXO Edge is a standout real estate accounting and service provider with unparalleled expertise and dedication in these domain areas.

EXO Edge has a client base that includes leading property management companies. 10 of the top 20 property management firms are our clients. Our clients collectively manage properties of over 2.3 million units across the United States. 

We have excelled in providing domain experience to our clients in finance and accounting, IT-managed services, recruitment, legal/ contract management, and business support services. What sets us apart is our commitment to building the right team, delivering results, maintaining accountability, and providing sustained quality and client satisfaction. 

EXO Edge embodies best practices to scale operations rapidly while significantly impacting efficiency for its clients. Their approach to client relationships and operational excellence offers a blueprint for successful offshoring.