Private equity firms in the UK often juggle a complex web of portfolio companies, each with its own accounting system, reporting cycle, and compliance demands. As a Finance Director or CFO at a PE firm, you may find yourself spending valuable time reconciling disparate reports and chasing down financial data from each business. It’s no wonder that private equity outsourcing in the UK is gaining traction as a strategic solution. In fact, roughly 70% of PE firms in Europe are actively outsourcing some finance functions. The appeal is clear: using a single outsourced finance partner across all portfolio entities can create consistency, efficiency, and transparency in financial reporting. This article explores how one provider for many entities delivers tangible advantages – from uniform reporting to faster closes – and why UK private equity firms are increasingly leveraging this model.
Consistency in Reporting Across the Portfolio
One of the biggest benefits of entrusting multiple entities to a single finance outsourcing provider is the consistency of reporting it brings. Instead of each portfolio company producing financial statements in different formats with varying key performance indicators (KPIs), an outsourced partner can implement standardised reporting templates and KPI frameworks across all holdings. This consistency means that every entity’s reports speak the same financial language, which greatly simplifies consolidation and comparison. Investors and stakeholders get one set of cohesive reports, making it easier to roll up results and deliver clear, apples-to-apples performance updates.
Consistency is about governance and accuracy. With one provider, you have uniform accounting policies and a consistent chart of accounts for all portfolio companies. This avoids discrepancies that might otherwise arise if each business applied accounting standards differently. As a result, private equity firms can standardise financial reporting and ensure compliance across all their portfolio companies. A reputable outsourced accounting service will employ best practices and robust methodologies to ensure accuracy and consistency in financial reporting across the board. In short, a single outsourcing partner creates “more consistent reporting and compliance across your portfolio”, instilling confidence that each entity’s numbers are reliable and aligned.
Faster Month-End and Quarter-End Turnarounds
Coordinating financial closes and reports across multiple entities can be a scheduling nightmare for PE firms. Different in-house teams may close their books at different speeds, causing delays in producing consolidated results. By contrast, when one external team handles month-end accounting for all entities, the process becomes a well-orchestrated, single cycle. An experienced outsource provider will run a coordinated month-end close for every portfolio company on the same timetable, so that the entire portfolio’s financials are ready together. This unified approach yields faster turnarounds for monthly and quarterly reporting. As Citrin Cooperman notes, a comprehensive outsourcing strategy can even lead to “accelerated month-end closes”.
With synchronised closing processes, PE firms benefit from quicker access to consolidated data for decision-making and investor reporting. There’s less waiting on stragglers or cleaning up inconsistent entries. One provider’s team is accountable for delivering all reports on time, every time. Indeed, outsourcing partners often provide each portfolio company with timely month-end financials and custom reports, even stepping in as de facto finance teams for businesses that lack in-house staff. This means fewer bottlenecks and a single, predictable reporting calendar for the whole portfolio. In practical terms, when quarter-end comes, an outsourced finance partner can get all entity books closed and aggregated in a single, coordinated effort – a boon for private equity CFOs who need to turn around fund-level reports swiftly.
Cost Efficiency and Economies of Scale
Another compelling angle is cost efficiency. Running separate finance teams at each portfolio company is not only cumbersome – it’s expensive. There are duplicate costs in hiring controllers, accountants, software licenses, audits, and so on. By contrast, outsourcing the finance function for multiple entities to one provider creates economies of scale. Providers often offer favourable rates when servicing multiple companies under one engagement, because they can leverage the same systems and staff across those entities. In other words, the more portfolio companies you bundle with one finance partner, the lower the average cost per company. This consolidated approach can significantly reduce overhead in each business and stabilise ongoing finance costs for the PE firm.
Using an outsourced partner also eliminates the need to build full in-house finance teams at each new acquisition. Portfolio companies – especially newly acquired or growing ones – often lack resources to hire senior finance talent. Outsourcing gives immediate access to experienced CFOs, controllers, and specialists without the time and cost of recruiting and retaining full-time staff. This not only saves on salaries and training, but also ensures you pay for exactly the level of service needed, when it’s needed. The cost model is typically flexible and scalable (more on that shortly), which helps avoid the inefficiencies of under-utilised hires. As one firm’s experience shows, being the preferred financial provider for an entire fund allows the outsource partner to drive “efficiencies through standardised processes, consistent reporting formats, and shared best practices across the portfolio…benefiting from economies of scale”. In sum, one provider, many entities = a leaner cost structure for finance operations across all your investments.
Centralized Risk Management and Compliance Control
In the world of private equity, financial compliance and risk management are paramount. Different portfolio companies might face different regulatory requirements – but a single misstep (a missed filing, an accounting error, a control failure) in any one entity can tarnish the firm’s reputation and even lead to penalties. Engaging one outsourced finance partner to oversee all entities brings centralized controls and oversight to mitigate these risks. An external provider’s team will implement strong internal controls uniformly, conduct regular checks, and ensure nothing falls through the cracks across the portfolio. This greatly reduces the risk of errors or missed filings, since the process is supervised by one accountable team rather than a patchwork of siloed in-house accountants.
Crucially, an outsourcing partner also helps ensure consistent application of accounting standards like IFRS or UK GAAP for all holdings. In the UK, some mid-market companies might otherwise use local UK GAAP (FRS 102) while others use IFRS – but a private equity sponsor may prefer consistent IFRS-based reporting for the group. A knowledgeable provider will see that each entity’s statements adhere to the appropriate standards and policies. Adhering to common financial reporting standards (whether GAAP or IFRS) across businesses ensures consistency and comparability. This not only avoids technical accounting discrepancies but also instils confidence that all entities are meeting their legal and regulatory obligations. As Quatrro’s Paul Lennick observes, partnering with an outsourced accounting service is an effective way for PE firms to standardise reporting, manage risk, and ensure compliance across all portfolio companies. The provider stays abreast of changing regulations and filing deadlines, keeping each company compliant with everything from IFRS/UK GAAP rules to tax submissions and statutory filings. With one vigilant team watching over compliance, private equity managers can rest easier knowing there’s a consistent, proactive approach to risk management throughout their investments.
Scalable Support for Growth and Transitions
Private equity portfolios are anything but static – new acquisitions are made, some businesses are sold, and companies grow or restructure. Using one outsourcing provider offers a highly scalable support system that can flex with these changes. Need to onboard a newly acquired company quickly? An established finance outsourcing partner can swoop in and get the newcomer’s books integrated and “audit-ready” within weeks, standardising its chart of accounts and procedures in line with the rest of the portfolio. In fact, outsourcing is often key in roll-up strategies: when a PE firm acquired 12 fragmented companies, they turned to an external advisor (in this case RSM) to standardise all those businesses on one ERP and accounting platform, eliminating inefficiencies from each using different systems. The result was seamless integration across entities, improved financial oversight, and a smoother path to scale. This example underscores how an outsourcer provides the bench strength and know-how to handle rapid expansion.
Similarly, if a portfolio company is being exited, the outsource provider can adjust resources accordingly (or assist with the finance side of the sale and post-close transition) without the PE firm worrying about laying off an internal team. The flexibility of having on-demand financial expertise cannot be overstated. Outsourcing partners bring “immediate access to skilled talent and efficient processes”, which can be dialled up during high-growth phases or dialled down when an entity’s needs contract. This scalability also extends to specialised expertise: if a certain issue arises (say, implementing a new revenue recognition standard or handling complex treasury management), the provider can deploy the right experts as needed across your companies, rather than each business hiring niche consultants. In essence, one provider functions like a plug-and-play finance department that scales with your investment activity. As RSM describes, outsourcing allows PE firms to position their portfolio companies as “scalable, high-performing entities” by filling skills gaps quickly and maintaining continuity through transitions.
Conclusion: A Strategic Advantage for UK Private Equity
For UK-based private equity firms, outsourcing the finance function for portfolio companies is proving to be a strategic advantage and not just a back-office fix. It brings unified reporting, faster financial closes, cost savings, tightened compliance, and the agility to support growth – all of which ultimately contribute to higher portfolio valuations and smoother operations. Instead of each portfolio business reinventing the wheel with its own finance team, a single trusted partner can provide “standardised processes, consistent reporting formats…and shared best practices across the portfolio” while tailoring to each company’s needs. The decision-makers at PE firms – from CFOs to operating partners – are increasingly leveraging these quicker teams and broader skillsets that an outsourcer provides, rather than building out separate finance teams in every investment.
Malander is one such partner delivering these benefits to private equity clients in the UK. With extensive experience in comprehensive finance outsourcing, Malander has been consistently providing high-quality, scalable finance support for multiple-entity portfolios. We have a track record of ensuring accurate, transparent financial reporting aligned with IFRS and UK GAAP, robust controls to prevent compliance slip-ups, and efficient month-end cycles that keep all stakeholders informed. Our outsourced finance solutions offer the consistency, speed, and cost-effectiveness that PE firms need to focus on what truly matters – driving growth and value across their investments. By choosing a provider like Malander as the one-stop finance function for your portfolio, you gain a seamless extension of your team that is committed to your success. It’s one provider, many entities, and a world of difference in achieving finance excellence across your private equity portfolio.
Sources: The benefits and statistics discussed above are supported by industry insights and case examples, including reports on European PE outsourcing adoption, expert commentary on standardising reporting and compliance via outsourcing, and real-world cases of improved efficiency and consistency with a unified finance provider, among others. These illustrate that the outsourcing advantage for private equity is not just theoretical – it’s being realised by firms that embrace the model in the UK and beyond.