Outsourcing income tax returns : convenient and/or controversial

Chaplin, Sally (2013) Outsourcing income tax returns : convenient and/or controversial. Journal of Australian Taxation, 15(2), pp. 279-312.

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Abstract

This paper investigates the outsourcing of income tax return preparation by Australian accounting firms. It identifies the extent to which firms are currently outsourcing accounting services or considering outsourcing accounting services, with a focus on personal and business income tax return preparation. The motivations and barriers for outsourcing by Australian accounting firms are also considered in this paper. Privacy, security of client data, and the competence of the outsourcing provider's staff have been identified as risks associated with outsourcing. An expectation relating to confidentiality of client data is also examined in this paper. Statistical analysis of data collected from a random sample of Australian accounting firms using a survey questionnaire provided the empirical data for the paper. The results indicate that the majority of Australian accounting firms are either currently outsourcing or considering outsourcing accounting services, and firms are outsourcing taxation preparation both onshore and offshore. The results also indicate that firms expect the volume of outsourced work to increase in the future. In contrast to the literature identifying labour arbitrage as the primary driver for organisations choosing to outsource, this study found that the main factors considered by accounting firms in the decision to outsource were to expedite delivery of services to clients and to enable the firm to focus on core competencies. Data from this study also supports the literature which ndicates that not all tax practitioners are adhering to codes of conduct in relation to client confidentiality.

Research identifying the extent to which accounting services are outsourced is limited, therefore significant contributions to the academic literature and the accounting profession are provided by this ndicates that not all tax practitioners are adhering to codes of conduct in relation to client confidentiality.

Research identifying the extent to which accounting services are outsourced is limited, therefore significant contributions to the academic literature and the accounting profession are provided by this study.

Impact and interest:

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ID Code: 72110
Item Type: Journal Article
Refereed: Yes
Keywords: Income tax return, Outsourcing
ISSN: 1440-0405
Subjects: Australian and New Zealand Standard Research Classification > LAW AND LEGAL STUDIES (180000) > LAW (180100) > Taxation Law (180125)
Divisions: Current > QUT Faculties and Divisions > QUT Business School
Current > Schools > School of Accountancy
Copyright Owner: Copyright 2013 Monash University
Deposited On: 26 May 2014 22:45
Last Modified: 27 May 2014 21:46

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