Should your business send its IT function to a shared services centre in Mumbai, or operate a call centre in Glasgow? Releasing the company from the burdens of IT or other transactional processes has tended to be the limit of conversation.

But finance and accounting offshoring is finally about to step out of the shadow of more popular forms of outsourcing strategy.

A survey by Everest Research Institute has highlighted the offshoring of finance and accounting services as the biggest growth market for the global outsourcing industry.

Stephen Dunn, Everest managing principal for Europe, said customers were finally catching up with the benefits of offshoring F&A. ‘IT outsourcing around the time of Y2K was executed well,’ explained Dunn.

‘Companies then commoditised call centres, but F&A has always been viewed as the lifeblood of the company.’

Dunn said that business process outsourcing in general had taken a ‘tremendous leap forward’ in terms of being viewed as a value proposition by businesses.

F&A’s predicted offshoring growth is part of a wider trend in business process outsourcing. Everest found that the global BPO marketplace, worth $12bn-13bn (£6.9bn-£7.4bn) in 2004, will grow to $33bn-$36bn by 2007.

The largest third-party outsourcers, such as IBM Global Services, Accenture and EDS have all increased their employee capacity offshore over the past three years to cope with demand. Long-standing offshorer providers, such as Infosys and Wipro, have followed suit.

The report found accounts payable processing could be slashed from three or four days to 24 hours using offshorers to provide the service, while labour costs were reduced – freeing up local finance staff to provide more value-added services.

‘Accountants doing transaction work have been freed up into more valuable work,’ said Dunn.

Dunn said that these providers often ran IT offshore facilities for clients, which has led them to consider adding the F&A function layer as an extra service.

The report suggested that Eastern European offshore locations could prove popular for F&A outsourcing, due to a better cultural fit than more established setups in India and Asia.