The industry outlook and growth prospects look positive for finance and accounting outsourcing industry for the year 2012. After an unexpected slowdown in the previous year, the industry segment is all set for a growth rate of 10 to 15 percent for the year 2012. As per Finance & Accounting Outsourcing Annual Report 2012, it is expected that the outsourcing market will witness a growth trajectory of 4 to 4.5 billion USD in terms of annual contract value this year.
The report also confirms that the market was dim for finance and accounting outsourcing sector for the year 2011 with a growth rate touching only 11 percent compared to 18 percent for the year 2010. The annual contract value for the year 2011 was close to $3.8 billion only.
As per the industry experts, finance and accounting outsourcing sector will create demand for both shared services and third-party services. This is interesting as existing penetration of the third party service providers in this sector is only around 10 percent.
The contract extensions were at an all time high during the year 2011 and are expected to continue in the current year too. Contracts worth $7.3 billion have been signed the next three years.
Some of the major companies that have contributed almost 50 % of the overall annual contract value in the finance and accounting outsourcing market include the well reputed multi-national companies like
The highest number of contracts was signed in the previous year by companies such as
Accenture as well as
There has been an increasing market adoption trend across the global market towards Finance and Accounting segment. This trend is visible more in terms of smaller firms. Most of the contracts for Finance and Accounting outsourcing were done by the companies that have revenue of less than $5 billion. Almost 60 percent of the overall contracts signed in the year 2011 were by these smaller firms compared to 40 percent in the year 2010.
The year 2012 is all set to witness greater market adoptions by most of industries including manufacturing, Financial services, professional as well as high tech and telecom services. Finance and accounting outsourcing market segment is poised for a big leap this year especially with the trend of smaller firms going in for services from third party service providers.