Friday, June 13, 2008 [ sunstar.com.ph ]
WHILE growth of the business process outsourcing (BPO) industry in the Philippines is mainly due to the Filipinos’ proficiency in English, we should not overlook the fact that—as BPO services become more diversified—the country has the additional advantage of having the largest number of accountants, compared to other countries in Asia.
In the 62nd Annual Convention of the Philippine Institute of Certified Public Accountants (Picpa) last month, Ester R. Punongbayan of Punongbayan & Araullo outlined the Philippines’ competitive advantages in BPO services. She said that aside from lower operations costs and the Filipinos’ proficiency in English, our people are more familiar with American culture and slang.
Filipinos are also renowned for their flexibility in working with multiple accounting standards.
Picpa recognizes the importance of BPO to the country’s economy. The BPO industry, which is now considered the sunrise industry of the Philippines, has provided our economy steady and solid growth in the last five years.
In her presentation during the Picpa convention, Punongbayan discussed the business of outsourcing, which involves the transmission of processes—along with the associated operational activities and responsibilities—to a third party with a guaranteed equal service level.
Although it has outsourced certain functions to a third party, a company retains a firm grip over the activities of the service
provider (the outsourcing company) to ensure mutual long-term success.
BPO is positively related to the search for more efficient organizational designs that designed to reduce cost, improve productivity and encourage innovative capabilities within an organization or company.
There are different types of outsourcing. These are information technology and BPO. BPO includes call center, human resource, finance, logistics and accounting, knowledge process outsourcing, legal, medical transcription, software development and animation, and architectural design.
Finance and accounting outsourcing covers the following tasks: bookkeeping or book maintenance, accounts receivable collection, accounts payable administration, payroll processing, asset management, expense and revenue reporting, financial reporting, management report preparation, financial analysis, tax reporting, auditing, management consulting, inventory control, and purchasing.
It also covers other finance-related services, such as financial leasing, credit card administration and stock brokering.
Outsourcing services can be classified into two. There’s what is referred to as back office out-sourcing, which includes internal business functions, such as billing or purchasing. And then there’s front office outsourcing, which includes customer-related services like marketing or technical support.—Ricardo Y. Danlag Jr., CPA; Accountancy Department, University of Southern Philippines Foundation
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