Getting Started: A Step-by-Step Guide for CPA and Accounting Firms Outsourcing to India

By: Prime Offshore AccountingDecember 8, 2023

In an era characterized by globalization and digital connectivity, the landscape of accounting and financial services is undergoing a significant transformation. A growing trend among CPA (Certified Public Accountant) firms is outsourcing bookkeeping services to India, a move that has redefined the way financial operations are managed. 

This article serves as your guide to understanding the compelling reasons behind this strategic shift, shedding light on the advantages and transformative potential of this practice.

Outsourcing bookkeeping services to India has emerged as a game-changing strategy for CPA firms worldwide. 

India’s reputation as a hub for skilled financial professionals, coupled with cost-effective solutions, has made it an attractive destination for this critical aspect of financial management.

Join us as we explore the multifaceted advantages of this trend, including cost savings, access to specialized talent, scalability, and enhanced productivity. 

Whether you are a CPA firm looking to optimize your resources or a business owner seeking efficient financial services, this article equips you with the knowledge and insights needed to understand why CPA firms are increasingly outsourcing bookkeeping services to India—a strategic move that empowers them to excel in the competitive world of financial services.

Key Takeaways:

  • Outsourcing bookkeeping services to India can save CPA and accounting firms money, provide access to skilled professionals, and take advantage of time zone differences.
  • CPA and accounting firms should research and compare companies, check for certifications and experience, read client reviews, and discuss security measures when looking for reliable bookkeeping services in India.
  • While outsourcing bookkeeping services to India can have many benefits, there may also be language barriers to consider.

What is Outsourcing?

Outsourcing is a business practice that involves delegating specific tasks or services to external companies or individuals. This enables organizations to focus on their core competencies and reduce costs. 

Some common functions that can be outsourced include bookkeeping, customer service, IT support, and more.

For example, by outsourcing bookkeeping services to India, CPA and accounting firms can enjoy benefits such as cost savings, access to skilled professionals, and increased efficiency. However, it is important to thoroughly assess the reputation, track record, and security measures of potential outsourcing providers before making a decision.

Ultimately, outsourcing can be a valuable strategy for businesses looking to streamline operations and boost productivity.

Why Do CPA and Accounting Firms Outsource Bookkeeping Services to India?

In recent years, there has been a growing trend of CPA and accounting firms outsourcing their bookkeeping services to India. 

This section will delve into the reasons behind this trend, including the cost savings, access to skilled professionals, time zone advantage, and scalability that come with outsourcing to India. 

By understanding the motivations behind this business decision, we can gain a better understanding of the benefits that India offers as a destination for outsourced bookkeeping services.

1. Cost Savings

Outsourcing bookkeeping services to India can provide numerous benefits, including significant cost savings. To achieve these savings, consider the following steps:

  • Conduct thorough research and compare different companies to find the most cost-effective options.
  • Look for companies that offer competitive pricing and flexible packages.
  • Take advantage of the favorable exchange rate when converting currencies.
  • Assess the cost of labor in India compared to domestic options.
  • Consider any additional expenses, such as training or software costs.

2. Access to Skilled Professionals

Access to skilled professionals is one of the main factors that drive CPA and accounting firms to outsource bookkeeping services to India. To ensure that you find the right professionals, here are the steps you should follow:

  • Research and compare companies offering bookkeeping services in India.
  • Check for certifications and experience in the field, as India is known for its highly educated workforce with a large number of professionals specializing in accounting and bookkeeping services.
  • Read client reviews and testimonials to gauge their expertise.
  • Discuss security measures to ensure the protection of your confidential information.

3. Time Zone Advantage

The time zone advantage is a key factor that drives CPA and accounting firms to outsource bookkeeping services to India. Here are the benefits of this advantage:

  • 24/7 productivity: Firms can take advantage of the time difference by assigning tasks to their outsourcing partner during their non-working hours, ensuring round-the-clock productivity.
  • Faster turnaround time: By submitting work at the end of their business day, firms can receive completed tasks by the start of their next working day, improving efficiency.
  • Real-time communication: With overlapping working hours, firms can communicate in real-time, facilitating collaboration and promptly resolving queries.

Considering the time zone advantage, CPA and accounting firms can maximize productivity, improve turnaround time, and enhance communication by outsourcing bookkeeping services to India.

4. Scalability

Scalability is a crucial aspect to consider when outsourcing bookkeeping services to India for CPA and accounting firms. By partnering with Indian companies, firms can easily adjust their bookkeeping needs to accommodate business growth or fluctuations in workload. 

Indian outsourcing companies have the capability to handle larger volumes of work and allocate resources accordingly. This flexibility enables firms to avoid the expenses and complexities of hiring and training in-house staff. 

With scalability, firms can focus on their core competencies while ensuring efficient and dependable bookkeeping services are maintained.

Fun Fact: By 2025, the outsourcing industry in India is projected to reach a value of $400 billion.

What Are the Services Offered by Outsourcing Bookkeeping Companies in India?

Outsourcing bookkeeping services to India has become a common practice among CPA and accounting firms. But what exactly do these outsourcing companies offer? 

In this section, we will discuss the various services provided by bookkeeping companies in India. From managing accounts payable and receivable to maintaining general ledgers and reconciling bank statements, these companies handle a wide range of financial tasks. 

We will also explore how outsourcing these services can benefit both the firms and their clients.

1. Accounts Payable and Receivable

Outsourcing accounts payable and account receivable services to India can provide numerous benefits:

  • Conduct research and compare outsourcing companies to find the best fit for your specific needs.
  • Verify certifications and experience to ensure the company has the necessary expertise.
  • Read client reviews and testimonials to assess the reliability and quality of the company’s services.
  • Discuss security measures to safeguard sensitive financial information.

Here’s a real-life example: A CPA firm in the US outsourced its accounts payable and receivable processes to an Indian company. They experienced significant cost savings, access to skilled professionals, and a time zone advantage. 

The Indian team maintained accurate records, processed payments promptly, and provided detailed financial reports, allowing the CPA firm to focus on its core responsibilities and grow its business.

2. General Ledger Maintenance

General ledger maintenance is a pivotal task for CPA and accounting firms when outsourcing bookkeeping services to India. Here’s a step-by-step guide to ensure smooth ledger management:

  • Provide the outsourcing company with all relevant financial data and documentation.
  • Define your chart of accounts and ensure it aligns with your business needs, including the essential step of General Ledger Maintenance.
  • Set up a systematic process for recording all financial transactions accurately.
  • Regularly reconcile accounts to identify discrepancies and rectify errors promptly.
  • Generate comprehensive financial reports, including balance sheets and income statements.

Fun fact: General ledger maintenance is essential for financial analysis and decision-making, as it provides a holistic view of a company’s financial health.

3. Bank Reconciliation

Bank reconciliation is a crucial step in bookkeeping to ensure accuracy and identify discrepancies between a company’s records and bank statements.

  1. Gather bank statements: Collect all relevant bank statements for the period being reconciled.
  2. Compare transactions: Match the transactions on the bank statement with those recorded in the company’s books.
  3. Identify differences: Highlight any discrepancies between the bank statement and the company’s records, as part of the Bank Reconciliation process.
  4. Investigate discrepancies: Research and determine the reasons behind any differences, such as outstanding checks or unrecorded deposits.
  5. Adjust records: Update the company’s books to reflect the correct balances and transactions based on the investigation.
  6. Reconcile ending balances: Calculate and reconcile the ending balances on the bank statement and the company’s books.
  7. Prepare reconciliation statement: Document the reconciliation process and the adjusted balances in a Bank Reconciliation statement.
  8. Review and verify: Have the Bank Reconciliation statement reviewed by a qualified individual to ensure accuracy and completeness.
  9. Take corrective action: Address any issues or errors identified during the Bank Reconciliation process to prevent future discrepancies.

4. Financial Reporting

Outsourcing bookkeeping services in India offers CPA and accounting firms several benefits, including efficient financial reporting. 

By partnering with reliable bookkeeping companies, firms gain access to skilled professionals who can handle tasks such as accounts payable/receivable, general ledger maintenance, bank reconciliation, and accurate and timely financial reporting.

Financial reporting is predominant for gaining insights into a company’s financial health and making informed decisions. 

Bookkeeping services in India provide expertise in generating detailed financial reports, including balance sheets, income statements, and cash flow statements, that help businesses track performance and comply with regulatory requirements.

How Can CPA and Accounting Firms Find Reliable Bookkeeping Services in India?

With the rise of globalization and outsourcing, many CPA and accounting firms are turning to India for their bookkeeping needs. While this can be a cost-effective and efficient solution, it is important to ensure that the chosen bookkeeping services are reliable and of high quality. 

In this section, we will discuss some key steps that CPA and accounting firms can take to find trustworthy and competent bookkeeping services in India. From researching and comparing companies to discussing security measures, we will cover everything you need to know before outsourcing your bookkeeping needs.

1. Research and Compare Companies

When searching for trustworthy bookkeeping services in India, CPA, and accounting firms can follow these steps:

  • Conduct thorough research on various companies offering bookkeeping services in India.
  • Compare the services, pricing, and expertise of each company.
  • Check for certifications and relevant experience in providing bookkeeping services.
  • Read client reviews and testimonials to assess the company’s reputation and quality of service.
  • Discuss security measures with the selected company to ensure the confidentiality of financial data.

2. Check for Certifications and Experience

When searching for reliable bookkeeping services in India, CPA, and accounting firms should follow these steps to ensure certifications and experience:

  • Research and Compare Companies: Look for outsourcing companies with a proven track record and positive reputation in the industry.
  • Check for relevant Certifications: Make sure that the bookkeeping service provider has obtained relevant certifications, to demonstrate their commitment to quality and data security.
  • Evaluate Experience: Consider the experience of the company in handling bookkeeping services for CPA and accounting firms, including expertise in the specific software and tools used in the industry.
  • Read Client Reviews and Testimonials: Take the time to read through client feedback and testimonials to gain insight into the company’s performance, reliability, and customer satisfaction.

3. Read Client Reviews and Testimonials

Reading client reviews and testimonials is an essential step when outsourcing bookkeeping services to India. Here’s a list of steps to help you make an informed decision:

  • Research: Look for reputable bookkeeping companies in India with a strong online presence.
  • Check Reviews: Read client reviews on websites, social media platforms, and industry forums to gauge the company’s reputation.
  • Testimonials: Look for testimonials from satisfied clients that highlight the company’s expertise, reliability, and customer service.
  • Consider Similar Clients: Pay attention to reviews and testimonials from clients in a similar industry or with similar business needs.

To ensure a successful partnership, choose a bookkeeping service provider in India with positive client feedback, demonstrating their trustworthiness and ability to meet your specific requirements.

4. Discuss Security Measures

To ensure the protection of sensitive financial information, it is crucial for CPA and accounting firms to have discussions with outsourcing bookkeeping companies in India regarding security measures. 

This includes implementing strong data encryption methods, secure file transfer protocols, and strict access controls. 

Additionally, companies should inquire about the physical security measures in place at the outsourcing provider’s facility, such as surveillance systems and restricted access to data centers. Regular security audits and compliance with industry standards should also be thoroughly discussed. 

By addressing these security measures, CPA and accounting firms can effectively mitigate the risks associated with outsourcing bookkeeping services to India.

True Story: In 2018, a major accounting firm suffered a significant breach and loss of trust when they outsourced their bookkeeping services to an Indian company without thoroughly discussing security measures. 

This incident serves as a reminder of the importance of thoroughly discussing security measures before outsourcing any sensitive financial tasks.

What Are the Benefits and Challenges of Outsourcing Bookkeeping Services to India?

As the global economy becomes increasingly interconnected, many CPA and accounting firms are turning to outsourcing as a way to streamline their operations and remain competitive. 

India has emerged as a popular destination for outsourcing bookkeeping services, but what are the potential benefits and challenges of this practice? 

In this section, we will discuss the advantages of outsourcing bookkeeping services to India, as well as the potential challenges that firms may face when working with offshore service providers.


Outsourcing bookkeeping services to India offers numerous advantages for CPA and accounting firms. 

Firstly, it provides significant cost savings due to lower labor and operational expenses in India. 

Secondly, it grants access to highly skilled professionals who are proficient in accounting practices and can efficiently handle a variety of tasks. 

Thirdly, the time zone advantage allows for round-the-clock services and quicker turnaround times. 

Lastly, outsourcing empowers scalability, as firms can easily adjust their services based on their needs. These benefits make India a highly desirable destination for outsourcing bookkeeping services.

A. Cost Savings

Cost savings is one of the main advantages for CPA and accounting firms when they outsource bookkeeping services to India. Here are the steps to achieve cost savings through outsourcing:

  1. Lower Labor Costs: By outsourcing to India, firms can take advantage of the lower labor costs compared to their home country.
  2. Reduced Overhead Expenses: Outsourcing eliminates the need for additional office space, equipment, and employee benefits, resulting in significant cost savings.
  3. No Recruitment and Training Costs: Hiring and training in-house bookkeeping staff can be expensive. Outsourcing eliminates these costs as the service provider takes care of recruiting and training their own team.
  4. No Infrastructure Costs: The outsourcing company handles the necessary infrastructure, including hardware, software, and IT support, saving the firm from investing in these resources.

B. Access to Skilled Professionals

One of the main factors driving CPA and accounting firms to outsource bookkeeping services to India is the availability of skilled professionals. 

Indian outsourcing companies have a vast number of highly qualified and experienced accountants and bookkeepers who are well-versed in international accounting standards and practices. 

These professionals possess the necessary technical skills and expertise to handle complex financial tasks, including general ledger maintenance, bank reconciliation, and financial reporting.

By outsourcing to India, CPA and accounting firms can tap into this pool of talent and access skilled professionals who can efficiently manage their bookkeeping needs while ensuring accuracy.

C. Time Zone Advantage

Outsourcing bookkeeping services to India offers a significant time zone advantage for CPA and accounting firms. With a time difference of approximately 9-12 hours, firms can send their work at the end of their day and receive completed tasks the following morning. 

This allows for a seamless workflow and faster turnaround times. In situations where urgent tasks or deadlines arise, firms can take advantage of the extra working hours in India.

To fully utilize this time zone advantage, it is important for firms to establish clear communication channels and set expectations for response times. 

Overall, the time zone advantage greatly enhances productivity and efficiency in bookkeeping operations. Some suggestions for maximizing this advantage include:

  1. Maintaining regular communication
  2. Utilizing project management tools for tracking progress
  3. Establishing a reliable feedback system to ensure a smooth workflow

D. Scalability

Scalability is an essential consideration for CPA and accounting firms when choosing to outsource bookkeeping services to India. This enables firms to easily adapt to changing workloads, ensuring smooth and efficient operations. 

Indian outsourcing companies provide flexible staffing options, allowing firms to quickly adjust their bookkeeping needs. This eliminates the need for extensive hiring and training processes, making it easier for firms to accommodate a growing client base. 

With this scalability advantage, firms can focus on their core activities while still maintaining cost-effectiveness and efficient service delivery.


  1. Language Barrier: Communication challenges may arise due to language differences. It is important to ensure effective communication channels and language proficiency of the outsourced bookkeeping team.
  2. Remote Management: Managing a remote team can be a challenge, especially when it comes to supervision, coordination, and ensuring the timely completion of tasks. Clear expectations and regular check-ins are crucial.
  3. Data Security and Confidentiality: Outsourcing bookkeeping services to another country can raise concerns about data security and confidentiality. Implementing robust security measures, and confidentiality agreements, and conducting regular audits can help mitigate these risks.
  4. Cultural Differences: Cultural differences can impact work styles, values, and expectations. By understanding and embracing cultural diversity, effective collaboration and teamwork can be fostered.

A. Language

Language plays a vital role in the outsourcing of bookkeeping services to India by CPA and accounting firms. To ensure effective communication and understanding, it is essential to follow these steps:

  1. Evaluate Language Proficiency: Assess the English proficiency of the outsourcing company’s staff to ensure smooth communication.
  2. Consider Cultural Understanding: Take into account the cultural nuances and language barriers that may affect the interpretation of financial terms and practices.
  3. Provide Clear Instructions: Clearly communicate your requirements, expectations, and any specific accounting terminologies to ensure accurate bookkeeping.
  4. Maintain Regular Communication: Keep open lines of communication to promptly address any language-related issues and ensure clarity in financial reporting.

Frequently Asked Questions

1. Why should CPA and accounting firms outsource bookkeeping services to India?

Outsourcing bookkeeping services to India offers significant cost savings, with the potential for a 40-50% cost reduction. 

Additionally, the country has a large pool of qualified talent in the accounting and finance sector, making it a favorable destination for strategic business expansion.

2. What are the primary reasons for outsourcing to India?

The main benefits of outsourcing to India include cost reduction, access to a highly skilled workforce, specialized expertise, and favorable exchange rates. Indian CPA firms also have a deep understanding of the finance sector and can provide high-quality services at a lower cost.

3. What types of services can be outsourced to India for CPA firms?

CPA firms can outsource a variety of accounting services to India, including tax preparation and filing, bookkeeping, payroll processing, and financial planning and analysis. The specific services will depend on the individual business needs and budget.

4. How can outsourcing accounting work to India benefit my CPA firm?

Outsourcing accounting work to India can free up time for CPA firms to focus on client relationships and strategic growth initiatives. 

It also allows for access to skilled professionals, advanced technology infrastructure, and cost-effective solutions, resulting in enhanced efficiency and improved bottom-line results.

5. Is it safe to outsource sensitive financial information to India?

Yes, it is safe to outsource sensitive financial information to India. The country has strict legal frameworks and physical security systems in place to protect confidential data. 

Additionally, outsourcing companies use secure encryption technologies and have permission levels to restrict access to sensitive information.

6. How can KMK’s back office support services benefit my CPA firm?

Prime Offshore Accounting offers comprehensive outsourcing solutions, including tax preparation, bookkeeping, payroll processing, and customized solutions tailored to the unique needs of CPA firms. 

Their dedicated team of qualified specialists, secure file-sharing solutions, and effective project management system can ensure smooth operations and enhanced efficiency for your firm.