Small and medium-sized accountancy practices can use offshore centres to tackle staff shortages at home.
Offshoring may seem like yesterday’s news and part of a globalisation narrative that has since lost its sheen. But in recent years, particularly since the covid19 pandemic, offshoring has experienced a fresh wave of popularity as accountancy and audit firms in the developed world experience a recruitment crisis.
Accountancy firms in the UK and elsewhere have turned to offshore centres, or opened their own offices overseas, to help provide the skilled staff they need to service clients in their home jurisdictions.
Vipul Sheth, a UK accountant and former KPMG tax manager, is the founder of AdvanceTrack, an offshore service provider with four locations in India employing around 500 people, mostly focused on providing outsourced services to small and medium-sized UK firms.
"We have never been so busy," he says.
The story of accountancy firms seeking offshore workers was recently writ large when BDO in the US announced it would open centres in India and South Africa – doubling the size of its overseas workforce to 5,000 – mostly because of a fall in the number of graduates at home.
Small firm opportunity
BDO is not alone in this. All the Big Four firms have offshore locations, while a throng of service providers have sprouted to offer smaller firms their opportunity to make use of skilled and willing accountants overseas.
This was once all about the costs – qualified staff in places like India work for comparatively lower wages – saving firms money.
There are efficiency savings too. Offshore staff are more likely to take on easier, more routine tasks, leaving staff at home to focus on value-added services, such as advice and consultancy.
But there are other factors now at play. Accountancy firms may be struggling to maintain their staff numbers and new recruits because of the retirement of baby boomers and a global uptick in demand for accountants. Advances in technology may have convinced some candidates that accountancy and audit are on the cusp of being taken over by machines.
Some of the reasons may also be cultural and born of experience from the pandemic, which prompted many people to question their career and life choices.
Sheth says the growth of other industries, including finance and IT, has drawn young people away from accountancy. So, too, has a perception that accountancy offers a lifestyle that is too demanding and with too many risks, especially at senior levels.
"They don’t want the lifestyle and they don’t necessarily want the partnership," he says.
Scandal may have played a part too. At the end of December 2021, Kevin Ellis, senior partner and chair of PwC, warned that criticism of the profession, following a raft of scandals and tightened regulation, was deterring recruits.
According to Antonis Diolas, head of audit and assurance at ACCA, work-life balance, wellbeing and the time it takes to train may be all playing a role, depending on the jurisdiction.
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