Global Accounting Outsourcing to Surpass $47 Billion by 2008
The worldwide finance and accounting (FA) outsourcing market will reach $47.6 billion in 2008, growing at a 5-year CAGR of 9.6%, a new IDC study reveals. Spending on outsourcing of the transaction management function is expected to grow the fastest, at 9.8%, over the next five years. From a regional perspective, the study determined that the U.S. will remain by far the largest FA business process outsourcing (BPO) market, while EMEA will be the fastest growing region in terms of FA BPO spending in the short to mid-term.
"The finance and accounting BPO opportunity is one of the largest and fastest growing BPO segments. As the opportunity matures, corporate buyers will increasingly be looking at FA vendors to provide an expanding range of services, collaborate on building full-scope back-office solutions, and solve strategic business challenges," said Anna Danilenko, program manager, Consulting and FA BPO Services.
Additional key findings of this study include:
- While cost cutting remains the primary reason for outsourcing FA, the need to solve strategic business issues is increasingly driving FA BPO spending globally.
- Transaction management services represents the largest opportunity within the FA BPO space while accounts payable remains the most widely outsourced FA function.
- Processing services, business advisory services to senior finance executives, and services opportunities around financial compliance are expected to serve as the most effective leads into FA BPO arrangements.
- Mergers and acquisitions among FA BPO vendors will continue to accelerate as providers aim at gaining market share, expanding into key regions and acquiring specialized business process and consulting expertise.
IDC's new study, US Finance and Accounting Outsourcing Market Forecast and Analysis, 2003-2008, (IDC #31107), presents the worldwide and U.S. FA BPO market forecast and analysis by major regions and distinct FA sub-processes, such as transaction management, finance, general accounting, treasury and risk management, and tax management, that comprise the FA function. In addition the study provides an analysis of major market drivers and inhibitors, insights on key buyer trends, overview of major competitive dynamics and essential guidance for FA BPO services vendors.
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