Globalization, stricter regulations (such as Sarbanes-Oxley Act), and the need to adapt to international standards have made financial accounting more complex for American businesses.
There is a growing pressure to adopt the International Financial Reporting Standards (IFRS) in addition to U.S. Generally Accepted Accounting Principles (GAAP). This is challenging due to fundamental differences in the approach between IFRS and GAAP. For instance, GAAP is a rules-based standard, and IFRS is more principle based. Even inventory management and long-term assets are handled differently.
Given the growing complexity of US accounting practices coupled with scarcity of qualified accounting resources, it often makes economic sense to outsource your accounting function or at least, the data intensive repetitive accounting tasks.