Posted on 04/16/2003 5:04:31 PM PDT by John Lenin
WASHINGTON: Millions of Americans sweated it out on Tuesday, struggling to meet the deadline - April 15 - for filing their annual tax returns as accountants and post offices stayed open late to accommodate the laggards. Many will be hoping the Indians have lived up to their reputation for sound number-crunching.
In keeping with the great outsourcing trend that has swept across American businesses, thousands of US tax returns are now being processed in India, a development that has led to quite a stir in the accounting community. Numbers are hard to pin down, but according to Kishore Mirchandani, president of Outsource Partners International, the firm that claims to have triggered the development, more than 10,000 returns went to India for scrutiny this year.
The accounting firm Ernst and Young alone is believed to have forwarded 7500 American tax returns to its subsidiary in India after transferring a tax partner familiar with US tax laws there. Scores of other smaller accounting firms have also sent returns numbering hundreds to India after a pilot study last year showed encouraging results.
"The business is still in its infancy, but we are looking at over 100,000 returns going to India this coming year," says Mirchandani, whose firm has a 300-person operation in Bangalore and is looking to expand because of the growing demand. Several traditional American firms are also lining up to send returns to India, after pilot projects showed significant reductions in costs and turn-around times.
"More and more firms are jumping on the bandwagon after seeing the results. They seem very satisfied with the quality, not to speak of the speed and cost factors," says Bill Carlino, Editor-in-Chief of the journal Accounting Today, which has tracked the trend over the past year.
Expectedly, not everyone is thrilled with the outsourcing of what some regard as sensitive financial information. In the latest issue, the magazine Practical Accountant ran a column by a New York accounting professor questioning the trend on grounds of security and job loss to Americans.
"If you were to stop by any downtown skyscraper where Ernst & Young has an office, I guarantee that you could not just walk to the elevators and go up to the company's offices. You would be stopped by at least one security officer before you got anywhere near the elevator bank," wrote Prof Lloyd Caroll, head of the accounting department at Manhattan Borough Community College. "Yet the company does not appear to be troubled by the notion of putting taxpayer security in peril by sending returns out of the United States."
"The very notion of transmitting confidential tax data - from Social Security and employer identification numbers to financial information - to any foreign country, even Canada, borders on the reprehensible at best, and is treasonous at worst," Caroll fumed.
But accounting firms say security is a non-issue. What they are moving to India are only images and the original data remains with the US firm. The software used by the firms is also web-enabled and is accessed by the Indian subsidiary through a server in US.
Firms also reported a 50 to 60 per cent cost reduction, besides improved scrutiny because they are able to hire better qualified people. In the US, simple returns are often viewed by junior staff who are not CPAs.
Although the pilot studies of last year involved sending simple low end returns, some firms such as Toronto's Horwath Ornstein are now said to be sending high-end returns. In turn, firms are also posting Indian-American CPAs qualified in US tax laws to India
to oversee the work.
"The accounting profession in India itself has improved a great deal and quality should not be a problem," says Ram Ganesan, a Maryland-based CPA, who practices in the United States but sees outsourcing as an encouraging trend.
Have at it. There's probably a market niche for people willing to pay trebble for the pleasure of knowing that locals alone are parochially hired.
Lilly; I quarantee the accounting firms are still charging the client the full stroke, even though he is getting it done for pennies on the dollar. I am sure there are Americans in this country that would be qualified to do this job.. Regards
NYC; A great idea friend. But I believe if you tried it, you would be run out of town. Regards
A Legislative History of H-1B and Other Immigrant Work Visas
1990
The passage of the 1990 Immigration Act is often considered the day H-1B was born. Under the 1990 Act Visas for employment-based immigrants rose to 140,000 from the 58,000 cap established in 1976. The 1990 Act set an annual cap of 65,000 nonimmigrants entering the U.S. under H-1B visas. H-1B workers were given a 3 year visa with a possible extension for a total of six years. It specified that H-1B workers must hold at least a bachelor’s degree or its equivalent in their specialty field. The Act also required employers to pay H-1B workers the prevailing wage. In addition, the 1990 Act created three other new visa categories for skilled temporary workers--the H-1A visa for nurses and O and P visas for prominent scientists, educators, artists, athletes and entertainers. [4] A cap of 25,000 visas per year was placed on the annual number of newly created "P visas" available for foreign workers in the entertainment industry. [14]
How long before we start seeing Indian stand-up comics and linebackers?
Scientists and educators do provide value-added services (in spite of the fact most of them are liberals) and they are displacing American employees.
I lost my cushy job in the dot-com implosion and I am not blaming anybody but myself for knowing there was a bubble about to burst and NOT lining up a job in another industry.
Now I'm getting by with contract work here, contract work there, etc., have an overarching "thing" I do, but it doesn't pay me well and I can't talk about it...erm...anyway, point is:
I don't blame anybody. I've been laughed at by liberals who found out I donated to the Bush campaign when I was "flush" (at one of my workplaces). They told me they bet I wanted the money back, chuckle. I told THEM I'd donate blood to give again if I have to.
And there are jobs out there. If you're looking. And willing to work a little harder than just pushing pens around.
Maybe the "Indians with pregnant wifes" are just willing to take certain jobs you don't want to sully your hands with. Because if you're having employment problems, I will gladly send you a 50+ list of companies hiring in your area. They're data entry type postions, at best, but I'm currently doing pretty much that alongside a lot of other very smart people who've fallen on tough times. Plenty of college degrees to go around.
When I don't work, it's because I'm being lazy, not because someone is stealing my job. But that's just me.
And if we want to get industry going, cut taxes. Better yet, cut CAP GAINS taxes.
This process if not reversed, might lead to the Argentinization of America. Maybe Perot and Buchanan were right.
As far as non-union contractors even bidding on jobs, it is very difficult considering the use of so-called project labor agreements in some areas. So I guess I'm saying that unions are protective of their own and also exclusionary to types of people they don't favor.
Read CODE NAME KINDRED SPIRIT, by Notra Trulock, ISBN 1-893554-51-1. It will really make your blood boil.
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