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 How To Ensure Your Financial Information Is Safe When Outsourcing


Outsourcing your financial works to a third-party provider can often produce the same or better results at a fraction of the cost. For modern accounting departments that may face a lack of talent and the need to do more with less, outsourcing business processes allows them to reuse their budgets to focus on value-added activities.


According to a survey conducted by Deloitte, 59% of companies say that reducing costs has been the impetus for outsourcing their operations. Another 57% say it allows them to focus on core business activities - probably why most companies initially explore outsourcing through more transactional processes, like payroll.


Although many companies are reviewing outsourcing their financial tasks, it is normal to have concerns. The main problems are security concerns and data confidentiality. Financial data is susceptible, and many high-profile examples of companies have failed to protect their own information and their customers.


So what takes precedence when considering outsourcing your financial tasks to a third-party platform? Picking the right and trusted partner is definitely your first line of defense against a data breach. Make sure your new provider provides the following protections to ensure data security and integrity throughout the partnership - not only at the beginning. 



How To Ensure Your Financial Information Is Safe When Outsourcing

 

So how exactly do you make sure that when outsourcing certain project of your organization, your company vital information and valuable data is safe and secure: 



1. CyberSecurity Protection Checks


Your goal should also be to find a provider with complementary security processes, competent personnel, and sophisticated technology to protect your information against digital attacks. 


Compare potential outsourcing partners and those using a multi-layered cybersecurity approach, with widespread protection on computers, data, and networks.



You should also ask yourself if your provider is scheduling regular backups. Backups protect the outsourcing company from data loss caused by system malfunctions, accidental deletion, data corruption, and/or theft. If not, you will not have the means to recover damaged, lost, or compromised information.


2. Awareness Policies and Security Training 


Confirm whether the third-party provider needs its employees to take cybersecurity awareness courses. Such training ensures that staff can deal with digital threats effectively and understand the consequences of the business.


Take the time to check your company's social media policies, computer usage, and information security. A laptop is lost every 53 seconds, so you want a frame to protect networks, information, and sensitive devices. Information security policies should list how the company will maintain vital data and information processing facilities.


3. Employee Screening And Access


Depending on your outsourced tasks' sensitivity, you may even be required to ensure that your outsourced staff pass certain background checks. For instance, Focused Technologies Imaging Services was sued to the tune of $3.1 million for outsourcing a fingerprint processing contract to an Indian company that did not meet New York State requirements for pre-employment screening.


You may also want to negotiate access - in the sense that only role-based access should be granted to the provider's employees. No one should have exclusive privileges for sensitive material. Throughout the contract, continuously monitor and verify access rights. Make sure you know your team and continue to communicate frequently to stay in control of your data.


4. Leadership Commitment And Internal Audits


Senior management should provide a full commitment to cybersecurity, providing all necessary resources and support. The security leaders should report directly to their site's heads, which monitors all protocols, cyber threats, and security activities.



Audits also provide information on the effectiveness of current system processes, procedures, and maintenance. The company should perform vulnerability scans to assess weaknesses and regularly implement controls.


5. Management Systems


International management systems, such as ISO 27001, offer guidance for information security, including maintaining the availability, confidentiality, and integrity of sensitive and critical data and processing facilities. ISO 9001: 2015, on the other hand, provides guidance and standards for handling documented standard operating procedures. Make sure your outsourcing provider is aware of these certifications, with unlimited participation plans.



Conclusion


Deciding to outsource low-impact financial operations, such as accounts payable,  receivables, transaction assistance, and more, is a great way to increase corporate accounting efficiency. Validating your outsourcing partner will ensure that your financial information remains secure. By staying alert, choosing the best supplier, and protecting the front-end processes, you will be able to enjoy the benefits of outsourcing without security concerns.

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