Risks and Control in Accounting outsourcing: Cases in Malaysia

The main objective of this article 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. This study points to the risks issues in accounting outsourcing of client and vendor engaging in accounting outsourcing work. The study provides further evidence on risks and control in accounting outsourcing faced by client and vendor. Findings show that firms are facing different types of risks inherent in the accounting outsourcing task such as that of relational risks and performance risks. Both clients and vendors are relying on formal control mainly contract and Service Level Agreements (SLAs) in managing those risks. Theoretically, this article provides further evidences of risks in accounting outsourcing and the reliance of contract and SLAs in managing risks. Practically, this article provides further understanding on practices of accounting outsourcing work.