A practical checklist for US and UK firms to evaluate offshore accounting partners. It focuses on security certifications, legal safeguards, delivery quality, and transition readiness.
Define scope and risk before outreach
Set the baseline so vendors can quote and deliver against the same target.
Decide
- Processes to offshore: bookkeeping, AP/AR, payroll, tax prep, audit support, management reporting.
- Data sensitivity: client PII, bank data, payroll data, tax IDs.
- Workload pattern: average volumes, month-end, quarter-end, and busy season peaks.
- Success targets: accuracy, turnaround time, first-pass yield, rework limits.
Output to collect
- RACI for each process.
- KPI list with definitions and the reporting cadence.
Verify security certifications and day-to-day controls
Confirm independent assurance and how controls operate in practice.
Ask for proof
- SOC 2 Type II report for the most recent period, with exceptions and remediation notes.
- ISO/IEC 27001 certificate and Statement of Applicability, with surveillance audit dates.
- External penetration test summary and fix evidence from the last 12 months.
Check operational controls
- SSO and MFA, least-privilege access, privileged-activity logs.
- Encryption in transit and at rest, DLP, EDR, SIEM alerting.
- VDI or locked endpoints, time-bound access, geo-fencing.
- Backup and recovery with tested RPO/RTO targets.
Decision rule
Proceed only if certifications are current and exceptions have verified fixes.
Lock down legal and data protection terms
Map legal duties to contracts and workflows for both US and UK/EU data subjects.
Core documents
- NDA and MSA with audit rights, confidentiality, IP ownership, non-solicit, insurance, and liability caps.
- DPA aligned to GDPR/UK GDPR with purpose, retention, deletion timelines, breach notice windows, and subprocessor approval.
- Transfer mechanism for UK/EU data, such as SCCs or the UK IDTA, plus a current subprocessor list.
Artifacts to review
- Data-flow map with storage regions.
- Access provisioning and revocation process.
- Incident response plan with contact pathway and timelines.
Set service levels that measure real outcomes
Tie expectations to metrics that reflect quality and speed.
SLA examples
- P1 incident response within 1 hour.
- 98.5% reconciliation accuracy and under 1% rework.
- 99.9% VDI availability each month.
- Agreed turnaround for tax workpapers and month-end close items.
Governance
- Weekly ops review in the first 8 weeks, then monthly.
- Root-cause analysis and corrective actions for SLA misses.
Run a pilot that mirrors production
Prove capability before scaling.
Pilot design
- Duration: 2 to 4 weeks using your templates, tools, and real cases.
- Sample size large enough to measure accuracy and cycle time.
- Daily huddles and end-of-week reviews against your baseline.
Accept only if
- Targets are met for two consecutive weeks.
- Rework rate stays below the agreed threshold.
- Access and logging behave as documented.
Validate team capability and coverage
Ensure the team can maintain quality during peak periods.
Ask for
- Named engagement manager and reviewer ratios.
- US GAAP, UK GAAP, and IFRS exposure where relevant.
- Busy season coverage hours and holiday calendars.
- QA approach: sampling rate, error taxonomy, corrective action workflow.
- Onboarding plan with owners and dates.
Confirm the technology stack and access model
Protect client data while keeping work efficient.
Verify
- VDI or managed endpoints with MFA and audit trails.
- Approved systems for GL, workpapers, payroll, and file transfer.
- Ticketing and workflow tools with full audit history.
- Change control for templates and checklists.
- Daily backups and monthly restore tests.
Decision rule
No local downloads of client data, and all access is role-based and time-boxed.
Speak to references that match your profile
Seek specifics, not general praise.
Reference call script
- Scope, start date, and ramp speed.
- Accuracy and turnaround after 90 days.
- Incident history and how it was resolved.
- Team stability and turnover.
- What they would change in year one.
Plan transition, knowledge transfer, and rollback
Reduce disruption and keep control.
Transition plan
- Playbook with SOPs, templates, naming rules, and calendars.
- Shadow → reverse-shadow → own sequence with stage gates.
- RACI for approvals and month-end close.
- Exit steps: data return, verified deletion, handback of updated SOPs.
Takeaway
Use this field guide as your Offshore Accounting for US CPA Firms: A 2025 Due-Diligence Checklist. If you want a secure pilot with clear KPIs, audited controls, and a documented transition, Madras Accountancy can start a two-week trial on your tools and scale with quarterly reviews. Ready to scope the pilot?
