Risks and Control in Accounting Outsourcing: Cases in Malaysia

Book Chapter
Aini Aman, Ruhanita Maelah, Sofiah Auzair, Rozita Amiruddin, Noradiva Hamzah (2009), Risks and Control in Accounting Outsourcing: Cases in Malaysia in Aliah Hanim Mohd. Salleh, Ahmad Azmi Mohd. Ariffin, June M. L. Poon and Aini Aman (Eds)  Services Management and Marketing: Studies in Malaysia, Chapter 13, 227-241, 9789834480035, GSB-UKM, Kuala Lumpur.



Abstract: Chapter 13 Risks and Control in Accounting Outsourcing The main objective of this chapter is to examine the issues of risks and control of client and vendor engaging in accounting outsourcing using two case studies of firms located in Malaysia. Malaysia is the world’s third most attractive shared sources and outsourcing (SSO) location and offers low cost of labor and taxes with good infrastructure. Using two firms in Malaysia, the study provides further evidence on risks and control in accounting outsourcing faced by the client and vendor. Findings show that firms face different types of risks inherent in the accounting outsourcing task such as that of relational risks and performance risks. Both clients and vendors rely on formal control, mainly contracts and SLAs in managing those risks. Theoretically, this chapter provides further evidence of risks in accounting outsourcing and the reliance on contract and SLAs in managing risks. Practically, this chapter provides further understanding on risks in accounting outsourcing work.