Why Hiring an Offshore Accountant is the Best Decision You’ll Make for Your Business

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Accounting is one of the defining professions of the modern world. As Warren Buffet famously said, “accounting is the language of business.” Ever since the earliest iterations of accounting in Ancient Mesopotamia and Rome to the invention of modern double-entry bookkeeping in 1494 by Luca Pacioli, accounting has been the backbone of commerce and business.

Accounting’s complex rules, byzantine regulations and infinite variation make it a difficult field to approach for a novice. Instead, we leave our accounting needs in the hands of trained and certified accountants who spend years studying all the intricacies of accounting before becoming full-time accountants. 

In recent years however, the accounting profession has fallen out of favor for entrants into college and the field is facing and the US is facing a severe and prolonged accounting shortage. In fact, the US is short of 340,000 accountants today despite median wages jumping by over 25% in the last 10 years from $63,550 in 2012 to $79,880 in 2023

Unfortunately the shortage in accounting talent in the US is only going to get worse with the Bureau of Labor Statistics forecasting a 4% annualized growth rate in the demand for accountants in the US from 2022 – 2032. This will create as many as 126,500 new accounting roles that need to be filled annually. To make matters worse, the number of students graduating with a Bachelor’s or Master’s degree in accounting has dropped from about 80,000 in 2016 to 65,000.

With fewer college students studying accounting every year and growing demand for accountants creating more and more unfilled roles every year, American businesses are trapped between a rock and hard place. 

However, a growing number of American businesses have a secret weapon they are using to plug this gap – offshore accountants. Whether you are a startup or small business struggling to hire an accountant or an established company looking to make the most of your budget, tapping into global talent is a gamechanger for your business. Here are some key advantages of hiring offshore accountants.

Top Advantages of Hiring Offshore Accountants

  • Cost Savings: Offshore accountants are 50-70% cheaper than onshore equivalents helping make the most of your hiring budget
  • Hire Top Talent: Going offshore allows you to get a realistic shot at hiring top 1% accounting talent and offers a much easier path to retaining them than hiring onshore
  • Increase Your Output: With the cost savings that come with hiring offshore accountants you can afford to hire 2-3 offshore accountants for the same cost of an onshore equivalent. More hands on deck helps increase your output and makes sure no balls get dropped. 
  • Scale Your Accounting Team: More than half of the world’s accountants are based outside the United States. Tapping into the global pool of accountants makes it much easier to scale your accounting and finance department as your business grows. 
  • Supercharged by AI: AI is changing the nature of the accounting profession and making it a more strategic and analytical profession. Offshore accountants are rapidly learning and adopting AI tools and in our experience AI is helping close the gap between offshore and onshore talent across most jobs. 

Cost Savings with an Offshore Accounting Team

When it comes to managing your company’s finances, the costs can quickly add up especially as your business scales and your finances become more complex. More importantly, cutting corners on your accounting process to save a few dollars is a recipe for getting in trouble with the IRS and other regulators. All together that means that accounting expenses can be a significant burden on your bottom line and continue to grow as your business scales. 

However, hiring offshore accountants can really help you make the most out of your accounting budget as a business. Offshore accountants can be anywhere from 50-70% cheaper than onshore equivalents in the US. These savings allow you to hire 2 or 3 offshore accountants for the price of one onshore equivalent or reinvest those savings in other aspects of your business such as buying new software, tools or increasing your marketing. 

More importantly than simply cost savings are the retention advantages inherent in hiring offshore accountants. Because of the severe shortage in accountants in the US today and inflation in wages, most accounting firms and companies are struggling to retain their talent. Accountants based in the US today are actively and aggressively being headhunted by other firms and being offered meaningful pay bumps to join new companies.

Source ICPAS

In contrast, the market for offshore accountants is less competitive than in the US and working for an American company often pays substantially better than working for a local company internationally. Hiring offshore talent to fill roles such as staff accountants, FP&A analysts, AP clerks and more is often a better approach than hiring them onshore because of the comparative ease of retaining them. 

Accessing Top Talent: How You Can Find Top 1% Accountants Offshore

There are at least 3 million accountants globally today of which about half are based in the US. In fact, the International Federation of Accountants (IFAC) alone claims a membership of over 2.8 million globally. 

Accounting is truly a global profession as this chart of IFAC global participating counties shows. There is a rich pool of global accountants for American businesses to tap into to meet their accounting needs. In fact, unlike in the US where accounting as a profession is falling in popularity, around the world accounting is seen as one of the best professions to get into. 

IFAC Global Member Countries
Source: IFAC

In addition to that, unlike some other professions accounting is particularly well suited to being done by a global team working remotely. The focus on numbers and the rules-based nature of accounting make it easy for offshore accountants to quickly add value and increase output. For many other professions working in an office together and regularly having facetime with your team are important enablers for getting high quality work done. 

The Big 4 Public Accounting firms have for decades now invested in building offshore offices and teams around the world. Their global offices have helped build the accounting profession globally and created a new generation of talent today that you can pick from. In fact, many offshore accountants spend their first few years in Big 4 sharpening their skills before seeking to leave for a role with more impact and responsibility (and better hours). 

A well-trained offshore accountant can deliver high-quality work from anywhere on earth. So why not take advantage of the cost savings of hiring offshore accountants?

Increased Efficiency: How Offshore Accountants Can Supercharge Your Productivity

Efficiency is critically important in managing an accounting department or accounting firm. The more organized and efficient your daily accounting operation, the easier it is to close your books at the end of the month or quarter and prepare financial statements. However, most accounting departments are always playing catch-up and running on a treadmill of never ending transactions and reconciliation work. 

Adding 2-3 offshore accountants for the price of one onshore equivalent can really augment your daily efficiency and productivity. Simply having more staff accountants or senior accountants on your team will help process transactions faster, audit the books more efficiently and produce the month-end statements faster. Moreover, because you can hire offshore accountants for a fraction of the cost of onshore accountants as a company you can afford to divide your team by specialities. You can hire dedicated bookkeepers, cost accountants, FP&A analysts and more with the cost savings that hiring offshore accountants offer. Having specialized team members responsible for specific parts of the accounting workflow will significantly increase the overall productivity of your accounting department.

Types of Accounting

Besides simply hiring more accountants, offshore talent also offers the benefit of having your accounting department working 16 or 24 hours a day. Imagine a world where as soon as the workday ends in the US your offshore accounting team can kick into gear overnight and categorize all the day’s transactions, update your accounting software stack and produce a short write-up of the day’s events for your onshore senior accountant or CFO to review and sign off on. Especially for businesses with a high-volume of daily transactions, this kind of approach can unlock enormous efficiencies for your finance department. 

Scalability: Seamlessly Scale Your Accounting Team with Offshore Talent

Hiring onshore accountants in the United States is already an uphill battle, especially if you’re not one of the Big 4 Firms or a large corporate business. If you’re a midsized, regional accounting firm, a startup or an SMB it’s harder than ever to hire great onshore accountants and it is only getting worse. 

Trying to hire onshore accounting talent in the United States today is like fighting gravity. The rate of new graduates in accounting is dropping and the retirement rate of accountants is accelerating all while the demand for accounting talent is predicted to grow at 4% a year up to 2032. 

As your business starts to scale and you look to add more accounting talent to your team the only real solution today is hiring offshore accountants. Today there are 672,000 Certified Public Accountants in the United States, which is just 0.2% of the US population! In contrast there the Institute of Chartered Accountants in England and Wales (ICAEW) claims to represent over 1.8 million CPAs globally while the Institute of Chartered Accountants of India (ICAI) claims to represent 265,000 members. That means that the pool of US accounting talent is something like 20-30% of the global talent pool. 

Global Accounting Organizations Total Membership IFAC ICAEW AICPA

Bar a huge resurgence in interest in studying accounting in the US, the next decade is going to see more and more American companies tapping into offshore talent to staff their accounting departments and fill the growing demand for accounting talent. 

Managing GAAP vs IFRS

The accounting world is divided between two competing camps. On one side we have the Generally Accepted Accounting Principles (GAAP) which is the standard in the US and on the other we have International Financial Reporting Standards (IFRS) which is the standard in most of the rest of the world. While we won’t bore you with the differences in the two approaches (and we’re sure you know them already), this is often a challenge with hiring offshore accountants. In accounting the details matter and the different approaches between GAAP and IFRS can produce different outputs when it is time to close your books. 

For offshore accountants that are looking to work in the US, the need to understand both Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS) has become a critical skill. The good news is many US companies with a global presence already manage both GAAP and IFRS as part of their reporting requirements. While American corporations will report their holding company numbers in the US in GAAP, most of their international subsidiaries will report their numbers in IFRS. Many of these companies already have processes in place to manage the transition between the two. 

The transition from GAAP to IFRS can be challenging, but with a little time and effort most accountants can effectively learn the differences between the two. The good news is accountants globally are increasingly learning and being trained in GAAP thanks to the global reach of US multinational companies who operate in multiple countries. 

How AI Can Supercharge Your Offshore Accountants

AI is changing the nature of work across every single profession and accounting is no exception. Just like the dawn of Microsoft Excel and accounting software tools like Quikbooks and Xero transformed the role of accountants, AI promises to do the same to the accounting and finance professions broadly. 

The good news is that AI will help increase the productivity of accountants by automating a lot of the manual, repetitive tasks like data entry, invoice processing, and reconciliations and allow accountants to focus on higher value tasks like how to categorize more bespoke transactions, questions of tax efficiency and more. Accountants will then be able to spend less of their time doing manual work and more of their time evaluating their books to check for errors, strategizing and optimizing their reporting. 

And for those who worry about job security, AI promises to transform an accountant’s day-to-day into a more strategic and enjoyable job. A recent article in Accountancy Age had this to say:

While AI will automate routine tasks, that doesn’t mean the accountant’s role is becoming obsolete. Instead, it’s evolving towards more strategic, analytical, and advisory functions. Accountants who embrace AI and learn to leverage its capabilities can become even more valuable, offering a wider range of insights and services beyond just crunching numbers. The human touch is still irreplaceable – skills like judgment, ethics, and communication are things AI can’t do. 

Conclusion: Take Your Finances to the Next Level with an Offshore Accountant

Offshore accountants are going to play an even more prominent role in the American business world over the next decade. Declining numbers of accounting graduates, the increasing rate of retirement of American accountants and the growing demand for accountants in the US are only going to increase demand for offshore accountants. 

The good news is that offshore accountants offer several benefits to American businesses including cost savings, the ability to attract and retain top global talent and the efficiency and scalability gains they bring. Embracing offshore accountants can give your business a competitive edge today. 

We believe the marriage of onshore accountants, offshore accountants and AI will unlock huge productivity gains over the next decade for businesses everywhere.  

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