ACCA Strategic Professional · Strategic Business Leader · Finance transformation

Halden Group is outsourcing its payroll and accounts payable to a third-party provider as part of finance transformation. The board expects the provider to take over all risk associated with these processes. Which statement best reflects the correct implication for Halden?

Halden remains accountable for the quality and control of outsourced payroll and payables, so it must manage the provider through contract terms, service level agreements and ongoing monitoring. Outsourcing transfers the work, not board responsibility, and it does not remove data protection or confidentiality risks.

1. AHalden retains accountability for the quality and control of outsourced processes, so it must manage the provider through contracts, SLAs and monitoringCorrect
2. BAll accountability transfers to the provider once the contract is signed, so monitoring is unnecessary
3. CHalden's board is relieved of responsibility for internal control over financial reporting for those processes
4. DOutsourcing removes data protection and confidentiality risks because the provider handles the data