Firms Should Consider Outsourcing in 2027

This feature explores the options and advantages of out-sourcing for accounting and tax firms.

As accounting firms gear up for tax season, and a new business year in general, there is plenty to consider proactively improving to serve more clients, reduce bottlenecks, and ensure customer satisfaction. One clear solution that remains is outsourcing.

Though it may not be a new option, various outsourced service providers specialize in specific business functions that could be a difference maker for your firm. Moreover, by offloading tasks to these providers, you can effectively free up in-house staff, enabling them to deliver a better client experience. It can also potentially remove the need to spend on and learn any new systems.

There is no denying the accounting profession remains in a talent shortage and although undergraduate enrollment improved last year, the overall picture remains weak. As a result, a recent survey found that 94% of firms reported recruitment as their biggest challenge to expansion.

For small firms, recruitment is even tougher because they lack the resources to hire and retain the talent big firms are scouting for. As a result, most accounting firms spend more time scouting for the right talent than focusing on customer acquisition, retention, and strategy.

Outsourcing Options

Outsourcing is still a viable option to help provide firms with the required expertise without having to recruit professionals in-house. They can offload specific functions, such as bookkeeping, reporting, or reconciliations, to an external provider while keeping core functions in-house.

They can also opt for different service providers for other functions. For instance, they can outsource the entire IT infrastructure to a cloud hosting provider or data security to a managed security service provider (MSSP). These providers offer expert support, relieving you of the pain of in-house hiring. Other functions firms can outsource include payroll, tax compliance, and marketing.

Cost Savings

Operational costs have also become a growing concern for accounting firms. In a survey, 70% of accountants admitted to rising operational costs in Q3 of 2026. This has been happening for a while for several reasons, including global tensions, inflation, and monetary policy. Moreover, due to the shortage of accounting professionals, firms are compelled to raise entry-level salaries by $10,000 year over year.

Another major operational cost that firms tend to ignore is the IT department. New and improved AI-powered tools are the need of the hour. However, these require advanced hardware to function. The result is an endless cycle of power bills, hardware procurement, and location upgrades. Moreover, firms must deploy an in-house IT team available 24/7 to manage the infrastructure.

Outsourcing can help you save on high operational costs. Although it incurs the charges levied by the provider, it can cut both CAPEX and OPEX in the long run. Outsourcing companies generally offer flexible services, allowing firms to pay hourly, monthly, or per project.

For example, a firm processing 100 monthly bookkeeping engagements could outsource standardized reconciliation and reporting tasks while retaining client relationship management, exception handling, and final financial reviews internally.

Another example is managed IT services, where the provider offers IT infrastructure while handling maintenance, setup, upgrades, and troubleshooting. You pay only for the resources you use, ensuring higher ROI and a lower total cost of ownership.

Growing through Outsourcing

Every accounting firm wants some form of sustainable growth, but only some are ready for the challenges it brings. When firms take on more projects than they can handle, they must either hire new accounting professionals or offer suboptimal services.

Hiring more employees means more office space, higher operational costs, and expansion of other departments, such as HR and IT. Moreover, firms sometimes need additional staff only for a specific period, such as tax season. Expanding the workforce or purchasing more workstations during that time is not a wise financial decision.

Outsourcing helps accounting firms build a scalable operational model. When you need additional help, you can outsource some business functions to a third-party provider. Instead of expanding the workforce on your company’s payroll, you can take the help of an outsourcing company for a defined period. This helps you save on employee benefits and salaries while enabling you to take on more clients during tax season.

Whether it is HR, finance, core accounting, advisory, or IT, a firm might have experienced professionals in every department to run efficiently. However, some situations require specialized skills your in-house team lacks. Hiring a dedicated professional only for specific cases or events is not economically viable.

In such cases, outsourcing tasks that require specialized skills is the right decision. For instance, a firm might have an in-house marketing team but require someone from outside with expertise in paid partnerships.

Another example is when you require a third-party managed security provider with expertise in risk management, compliance, and audits. You can onboard these service providers for a specific period without the hassle of talent acquisition, payroll, and management.

Outsourcing Can Help With the Impact of CAS 

Then of course is the rise of CAS practices. According to the CAS Benchmark Survey, CAS (Client Advisory Services) practices reported a 17% growth while the average reportable annual CAS revenue rose by 61%. Modern businesses want more from their accountants than just bookkeeping.

They look to firms for financial guidance, strategic planning, market analysis, and budgeting. So, for firms that want to thrive in a competitive market, offering Client Advisory Services isn’t optional. The problem is that the limited workforce handling day-to-day bookkeeping does not have the bandwidth to delve into CAS.

A partner who spends much of the week reviewing bookkeeping entries, managing reconciliations, and coordinating routine accounting deliverables has limited time to advise clients on business expansion, profitability, or financial planning.

By outsourcing certain tasks, CPAs can become full-time advisors to the clients. It not only helps accountants grow into new roles but also enhances the firm’s profitability.

Managing Risk through Outsourcing

Finally, there’s the issue of cyber threats. AI-based attacks such as phishing, impersonation, and social engineering, are the new norm. For accounting firms, this is alarming because even a minor data breach can mean significant financial losses.

However, aside from a few firms, most lack the expertise, technology, and infrastructure to identify, mitigate, or monitor these advanced threat actors. The result is irreversible reputational damage that most firms fail to survive.

There are service providers in the market that provide comprehensive security solutions for accounting firms. By outsourcing your firm’s data security, you don’t have to worry about your in-house security posture. These providers offer end-to-end security, even for remote employees.

Conclusions

In the end, it is my view that outsourcing different business functions not only saves costs and streamlines internal workflows but also gives accounting firms an edge over competitors. You can accommodate more clients during tax season without having to turn clients away because of a workforce shortage.

Moreover, you get access to rare talent and specialized services, helping you surpass client expectations. However, this is all possible if you choose the right outsourcing partner. Therefore, when outsourcing a specific function, you must include the relevant stakeholder from that department to understand the challenges and make the right decision.

Disclosures: 

This feature is contributed content, published as a service to our readers for informational and educational purposes. It is the opinion of the author and does not necessarily reflect the opinion of either Insightful Accountant, it's Publisher, or Editor(s). Further, it's publication should not be considered as an endorsement of either the conclusions offered or any services or products referenced within the feature (or linked thereto). This is an editorial feature, not paid advertising; neither the author, or any other party, has provided any form of remuneration to Insightful Accountant to secure this feature's publication.