The cost of admin in outsourced finance teams

Over the past few months, we’ve been in conversation with some of the UK’s leading outsourced finance teams, from top 30 practices to fast-growing regional firms.

We wanted to understand one thing: How much time does the month-end process really take?

The answers were remarkably consistent. Behind every set of management accounts lies a mountain of manual work: chasing clients for missing invoices, sense-checking adjustments and re-reviewing the same figures multiple times.

No one we spoke to considered their firm inefficient. Most have invested heavily in cloud tools and standardised workflows. But across firm size, client type and tech stack, the underlying issue is the same. Too much time spent on admin, not enough on insight.

And when you start to quantify it, the numbers are striking.

Where the time (and margin) goes

Accounting firms today face a paradox: they’re in high demand, yet profitability remains stubbornly flat.

The bottleneck isn’t a lack of clients. It’s the sheer weight of admin, much of it tied to month-end delivery.

Across the firms we've spoken with, a clear pattern has started to emerge. Though our sample was small and each firm’s setup unique, the averages were surprisingly consistent:

• Between 8 and 17 hours are spent each month, per client, on administrative month-end work.

• That equates to £400-£800 in internal cost per client, based on salary and overheads at an average internal rate of £46 per hour.

• On average, 60-75% of a client fee is absorbed before any advisory value is delivered.

This means that a firm managing 100 monthly clients could be spending the equivalent of £0.5-£1 million per year in internal time that can’t be billed, recovered or easily scaled.

Much of this work is “invisible,” buried in chasing, rework and review. So while recovery rates may look healthy on paper but quietly erode underneath.

The math behind the month-end

Recovery rate sits at the core of outsourced accounting and every extra hour spent chasing, checking or reworking quietly erodes it.

Partners across the firms we spoke with estimate that recovery has quietly slipped 5-15% below target, even without adding new clients or complexity. That shortfall compounds quickly:

• A £2M firm operating at 90% recovery loses roughly £200,000 in margin each year, often without realising it.

• At 80% recovery, the gap grows to the equivalent of an entire manager’s salary lost to inefficiency.

When we broke the process down, three consistent bottlenecks accounted for nearly 70% of the total effort required to close each set of books:

Accounting firms today face a paradox: they’re in high demand, yet profitability remains stubbornly flat.

The bottleneck isn’t a lack of clients. It’s the sheer weight of admin, much of it tied to month-end delivery.

Across the firms we've spoken with, a clear pattern has started to emerge. Though our sample was small and each firm’s setup unique, the averages were surprisingly consistent:

• Between 8 and 17 hours are spent each month, per client, on administrative month-end work.

• That equates to £400-£800 in internal cost per client, based on salary and overheads at an average internal rate of £46 per hour.

• On average, 60-75% of a client fee is absorbed before any advisory value is delivered.

This means that a firm managing 100 monthly clients could be spending the equivalent of £0.5-£1 million per year in internal time that can’t be billed, recovered or easily scaled.

Much of this work is “invisible,” buried in chasing, rework and review. So while recovery rates may look healthy on paper but quietly erode underneath.

Even small inefficiencies multiply fast.

100 clients × 10 hours × £46/hour = £46,000 per month, or £552,000 per year, in internal time tied up in admin. A modest 20% improvement in process efficiency could free up £100,000+ in annual recovery, without taking on a single new client.

This isn’t about poor management or bad systems. It’s a byproduct of processes designed for a pre-automation world, when accuracy and context relied on repetition.

It’s also fragile. In many firms, knowledge doesn’t live within the organisation, but within individuals. Client-specific context (how transactions are interpreted, where adjustments sit, what to look for) often exists only in one person’s head. When someone is off sick or on leave, the whole process slows down.

The true cost of admin isn’t just in the hours spent. It’s in the dependency on who spends them. Every unrecovered hour erodes margin, and every unshared piece of context weakens continuity.

Together, these are the economics that make the case for change.

The hidden cost to firms

The time lost to repetitive month-end work isn’t just a cost problem, it’s an operational one. When process dominates practice, the impact spreads; into profitability, people and continuity.

1. The human cost

Behind the numbers are teams who care about getting it right, but who spend too much of their time getting there.

Many describe the same frustrations:

• Re-doing work because data arrives late or changes halfway through.

• Balancing client relationships while chasing for missing information.

• Feeling undervalued when their role becomes mostly administrative.

This repetition doesn’t just drain energy; it drives attrition. When skilled people spend their days on low-value tasks, they look elsewhere for impact. That creates a cycle: more turnover means more review, more review means more admin, and recovery slips further.

2. The client experience cost

When internal processes slow down, clients feel it.

By the time management accounts reach them, several firms admitted the data is already two to three weeks old. That delay turns accounting from proactive to retrospective, from guiding business decisions to documenting what already happened.

The result is a growing gap between what clients expect (real-time insight) and what firms are resourced to deliver (end-of-month reporting).

3. The competitive cost

Combine these factors - recovery erosion, staff fatigue, trapped context, and slower client delivery - and a clear picture emerges: manual month-end is becoming commercially unsustainable.

Automation and AI aren’t just about doing the same work faster. They’re about building resilience, ensuring continuity when people are out, capturing context that stays within the firm and freeing teams to focus on higher-value tasks.

The firms best positioned for the future won’t necessarily be the biggest, they’ll be the ones who make their processes shareable, repeatable and resilient.

From admin to advantage

If those 10–12 hours per client could be reclaimed, the impact would be transformative.

For an outsourced finance team, that could mean:

• Capacity to serve 30–50% more clients without new headcount.

• More time to deepen relationships through analysis and forecasting.

• Improved staff satisfaction and retention.

• Stronger operational continuity when people move or take leave.

This isn’t about replacing accountants with AI, it’s about enabling them to focus on the work that truly adds value.

This report doesn’t claim to represent the whole industry, but it reflects consistent themes from dozens of conversations with UK firms.

The takeaway is simple: the cost of admin isn’t just measured in hours, It’s measured in lost continuity.

Processes need to be faster, yes, but they also need to be more resilient. Because when knowledge lives across the team, not within one person, firms can grow without slowing down.

In a profession built on accuracy and trust, that may prove to be the most valuable efficiency of all