Outsourcing Accounting Services: Between the Pursuit of Efficiency and Tax Revenue Losses: Evidence from SMEs in the Democratic Republic of the Congo

Abstract

This study examines the outsourcing of accounting services in small and medi sized enterprises (SMEs) in the Democratic Republic of Congo, focusing on the pursuit of efficiency and its fiscal implications. It draws on agency theory, transaction cost theory, resource based theory, and signaling theory to analyze the determinants of this practice as well as its effects on the quality of financial information. The research adopts a mixed approach combining quantitative and qualitative analysis. Data were collected from a literature review, interviews, and a field survey conducted with a sample of twenty SMEs located in the city of Kinshasa. The results show that 75% of the surveyed companies outsource their accounting services, mainly with the aim of reducing costs. This practice is more frequent among companies owned by expatriate proprietors. The study also highlights that outsourcing does not systematically involve the use of certified accounting firms, which limits the reliability of the accounting information produced. The shortcomings observed in bookkeeping, tax declarations, and the quality of financial statements are likely to affect financial transparency and contribute to fiscal revenue losses for the State. The study concludes that outsourcing constitutes a potential lever of performance when it is framed by accounting standards, control mechanisms, and compliance with tax obligations.

JEL Classification : M41, M42, L25, H25, D23

Paper type : Empirical Research