Concerns that the outsourcing of finance and accounting functions impedes the ability to control key processes related to compliance and governance appear to have abated, according to a survey commissioned by Accenture.
Among 203 executives surveyed by the Economist Intelligence Unit, nearly 60 percent now believe that the outsourcing of finance functions enhances the ability to adhere with compliance regulations such as Sarbanes-Oxley. And more than half believe that outsourcing alleviates the burden of staying on top of frequent changes to tax codes and accounting rules, while also providing an increased level of information transparency, visibility of controls and clarity of accountability.
Almost 60 percent of respondents agree that outsourcing increases the rigor of business processes, because they are better documented, according to Accenture.
"Executives increasingly believe that outsourcing can happily co-exist with today's greater emphasis on governance," said Stewart Clements, president of Accenture Finance Solutions. "We believe that this significant shift in attitude stems from results achieved by companies that have already outsourced their finance functions."
Executives whose companies outsource finance functions are far more upbeat than those whose companies don't. Just 48 percent of respondents with no experience agreed that outsourcing finance processes can actually deliver control benefits, compared with 73 percent of experienced outsourcers.
However, concern over information flow remains high. Nearly two-thirds of respondents reported being concerned about the quality of financial reporting provided to the management team by the outsourcing service provider. About 60 percent expressed concern about the service provider's knowledge of the company's unique requirements and controls to prevent fraud. Compliance with tax laws and accounting standards matter to about half of respondents, and accounts transparency for the benefit of auditors concern 36 percent of participants, according to the report.
While 46 percent of respondents believe that legislation like Sarbanes-Oxley and related regulatory activism have had limited or no impact on the company's outsourcing of finance functions, 39 percent think that such legislation and activism reduces the likelihood of companies outsourcing finance functions.
Eighty-one percent of respondents think that budgeting and forecasting should be kept in-house, while more than two-thirds prefer not to outsource treasury and cash management, information management and analysis, and financial risk reporting.
