I recently came across an article published by the Mail & Guardian Online, which speaks to the global phenomenon of taking business functions out of the head office and hosting them with third parties, in the public cloud. The article then leads on to the sensitive issue of outsourcing finance and accounting functions, indicating that the global trend is expanding to this sector too.
While most small to medium-sized enterprises (SME’s) will happily outsource their web hosting or call-centre requirements, they are far more circumspect about trusting their financials to a third party, says the Mail & Guardian. This is largely due to the sensitive nature of the information. Ironically though, according to a World Wide Worx survey, 87% of SME’s use online banking services!
Payroll information is another function which can be outsourced. What organisations need to keep in mind however is that they are obliged to protect their employees’ information and data too. It is therefor imperative that companies ensure that their service provider understands the various Acts and has ensured that its solution is compliant, says Dave Philp, operations director at CRS Technologies.
So the challenges currently faced by SME’s in relation to onsite financial, payroll and tax management include:
- Keeping up with software upgrades
- Keeping up with legislative requirements
- Additional administrative staff employed
- Compliance with the electronic system requirements of the South African Revenue Service (Sars)
The benefits of taking a Business Process Outsourcing (BPO) approach include:
- Business continuity
- Business security
- Unlocking of Business efficiencies
- Service level agreements ensuring good standard and quality of service
- Legislative compliance
Source: Mail & Guardian Online
For the full Mail & Guardian article, visit http://www.mg.co.za/article/2010-03-04-accounting-in-the-cloud