The Philippines: A Practical Choice for Outsourcing Accounting Services
The article discusses why the Philippines is a practical choice for Outsourcing Accounting Services.
Benefits of Outsourcing your Accounting Services to the Philippines
The Philippines is a practical choice to outsource business services.
A primary reason is that the Philippines remains attractive to investors with its budget-friendly hiring costs and associated minimum wage. The country’s labor cost is the lowest compared to its ASEAN counterparts.
Another reason investors outsource is the fact that the Philippines ranked 9th in the leading countries in offshore business services worldwide in 2021 with an index score of 5.96. The index score was based on the following criteria: Financial attractiveness assessment, People skills and availability assessment, Business environment assessment, and Digital resonance assessment.
Aside from low costs, there are several reasons that make outsourcing a specific function to the Philippines, in this case, the Accounting function, a practical choice for investors. Read more:
Accounting is an established and recognized industry in the Philippines.
Accounting as a profession was formally recognized in the Philippines on March 17, 1923 through Republic Act (RA) 3105, also creating and authorizing the Board of Accountancy to issue certificates. However, public Accounting practices go way back to the 1700s.
The Accounting education track in the Philippines is the same as the U.S.
This makes outsourcing to the Philippines a great option when outsourcing offshore. To be an Accounting professional in the Philippines, undergraduates follow a similar education track like that of the U.S.. Undergraduates are required to complete a Bachelor of Science degree in Accountancy (BSA) degree, higher or equivalent or a Bachelor’s Degree In Accounting, higher or equivalent, and graduates must pass the Certified Public Accountant Licensure Exam (CPALE).
The Philippines is regarded as a highly literate and proficient English-speaking country.
One reason investors choose the Philippines when outsourcing is that the Philippines is regarded as a highly literate and proficient English-speaking country.
The Philippines is regarded as a highly literate and proficient English-speaking country. The country places second in Asia for Asian countries with the highest English proficiency: Singapore, the Philippines, Malaysia & more [2021]. The country’s rank (18th), among the top 20, is better than in 2020 where the country ranked 27th out of 99 countries/regions analysed in the Index.
In the Philippines, Accounting courses are taught in the English language.
Accounting courses are taught in the English language. When Accounting graduates are hired in the BPO industry, aside from being able to work comfortably with numbers, have the proficiency of the English language. This is especially important in understanding, analysis and of tasks, updates and reports and interpreting them in terms that can be understood by clients with specializations other than Accounting.
The Philippine Institute of Certified Professional Accountants (PICPA) helps further the development of professional, ethical and educational standards of Accountancy.
All Certified Public Accountants in the Philippines are mandated to join the Philippine Institute of Certified Accountants or PICPA, which is the national professional accountancy body of the Philippines. PICPA is the accredited professional organization (APO) of CPAs by the Professional Regulation Commission (PRC). The organization was founded in November 1929 and currently has 196,000+ CPAs and 26,000+ active members.
Among the PICPA’s objectives are to further the development of professional, ethical and educational standards of Accountancy.
In accordance with the “Continuing Professional Development (CPD) Act of 2016”, PICPA is responsible in conducting seminars and disseminating information on the Code of Ethics and consequences of non-compliance with professional standards and continuing professional education.
Philippine Accounting practices are based on International Financial Reporting Standards (IFRS) and International Accounting Standards (IAS).
The Philippine Financial Reporting Standards (PFRS)/Philippine Accounting Standards (PAS) are the new set of Generally Accepted Accounting Principles (GAAP) issued by the Accounting Standards Council (ASC) to govern the preparation of financial statements. These standards are patterned after the revised International Financial Reporting Standards (IFRS) and International Accounting Standards (IAS) issued by the International Accounting Standards Board (IASB).
Conclusion
The Philippines is a top business process outsourcing destination for investors who want to outsource specific functions such as Accounting, offshore. There are many benefits to outsourcing Accounting services to the Philippines.
- In the Philippines, you can outsource Accounting at a much lower cost than hiring inhouse.
- Accounting is an established and recognized industry in the Philippines.
- The Accounting education track in the Philippines is the same as the U.S.
- The Philippines is regarded as a highly literate and proficient English-speaking country.
- In the Philippines, Accounting courses are taught in the English language.
- The Philippine Institute of Certified Professional Accountants (PICPA) helps further the development of professional, ethical and educational standards of Accountancy.
- Philippine accounting practices are based on International Financial Reporting Standards (IFRS) and International Accounting Standards (IAS).
Connext Global Solutions Offers Excellent Offshore Outsourcing Accounting Solutions
Connext Global Solutions is a remote staffing provider operating in the Philippines that provides offshore accounting and financial services support, standing IT support and Talent management and employee engagement with our cost-effective offshore accounting solutions.
At Connext Global Solutions we allow clients to start with as little as 1 full-time employee and scale as they see fit. Connext actively sources top talent required by the client.
Accounting Roles You Can Outsource
Businesses looking to offshore Accounting functions can tap from a huge talent pool of:
Accounting Associates: Accounting Associates ensure completion of Service and Compliance Tasks such as Accounts Payable Invoice and Accounts Receivable Billings, Bank Reconciliations, monthly and annual GET filing, payroll tax filing, weekly payroll and cash forecast and more.
Junior Accountants: Junior Accountants provide back-office support such as updating lists of requested information and supporting documents, update the Accountant Scorecard and deliverables status, prepare financial statements, reconcile Accounts Receivable & Retainage Receivable and other Balance Sheet Accounts Reconciliation, and more.
Senior Accountants: Senior Accountants oversee the finance department and provide assistance with external and internal audit examinations. They manage and supervise Junior Accountants in creating detailed financial reports and analyzing forecasts.
Controllers: Controllers verify bank reconciliation ties with the General Ledger. Their tasks also include reconciling Accounts Receivable & Retainage Receivable, and other Receivables. They also reconcile Prepaid Accounts, Deposits, Inventory, Fixed Assets, and Investment. Aside from this they also reconcile Accounts Payable & Retainage Payable, and Credit Card Payable, and other assigned related roles.
Bookkeepers: Offshore Accountants can also provide data entry services such as efficient recording of financial transactions, payroll management, invoice and billing management, processing of incoming payments along with the issuing of necessary paperwork, payment posting, and managing and reconciling balance sheets and financial statements.
Expand your outsourcing options in the Philippines. Gain insights from our blog post types of Accounts Payable Outsourcing Services to discover the variety of accounting services you can leverage in the Philippines for your business.
Start building a scalable support team of Finance and Accounting experts. Learn more about Connext Global Solutions today.
Learn how the Philippines, a prime destination for outsourcing accounting services, is also an excellent choice for graphic design outsourcing. Visit our blog for insights on leveraging Filipino expertise for your design needs.
References:
“Accountancy then and now”. https://businessmirror.com.ph/2018/03/18/accountancy-then-and-now/. Business Mirror – Column – Opinion. Published March 18, 2018. Accessed September 30, 2022.
“Leading countries in offshore business services worldwide in 2021”. https://www.statista.com/statistics/329766/leading-countries-in-offshore-business-services-worldwide/. Statista. July 6, 2022. Accessed September 30, 2022.
Amy R. Remo. “PH labor cost among lowest in Asean“. http://business.inquirer.net/209904/ph-labor-cost-among-lowest-in-asean. Philippine Daily Inquirer. April 29, 2016. Accessed September 21, 2022.
“Destination Manila: A Look at What Makes the Philippines a Top Accounting Outsourcing Destination”. https://www.personiv.com/philippines-accounting-outsourcing/. Personiv website. Accessed September 30, 2022.
Priya Sunil. “Asian countries with the highest English proficiency: Singapore, the Philippines, Malaysia & more [2021]”. https://www.humanresourcesonline.net/asian-countries-with-the-highest-english-proficiency-singapore-the-philippines-malaysia-more-2021. Human Resources Online | L&D. Published: 17 May 2022. Accessed September 30, 2022.
Philippine Institute of Certified Public Accountants. https://www.ifac.org/about-ifac/membership/members/philippine-institute-certified-public-accountants. IFAC. Last updated April 2018. Accessed September 30, 2022.
PICPA- About Us. https://picpa.com.ph/about_us/#1635864043515-f41f0fdc-d16a. Philippine Institute of Certified Public Accountants – The National Organization of Certified Public Accountants. Accessed September 30, 2022.
Republic Act No. 10912. Republic of the Philippines Professional Regulation Commission. https://www.prc.gov.ph/sites/default/files/CPD-FAQs-2020.pdf. Accessed 13 September 2022.
Philippine Institute of Certified Public Accountants – About Us. https://picpa.glueup.com/organization/959/about/. PICPA. Accessed September 30, 2022.
Regulations – Guidelines and Other Regulations. https://www.bsp.gov.ph/Pages/Regulations/GuidelinesOnTheEstablishmentOfBanks/Overview.aspx.. BSP. Accessed September 30, 2022.
