University of Oulu

Juntunen, J., Lepistö, S. and Juntunen, M. (2022), "Latent classes of accounting outsourcing firms", Journal of Global Operations and Strategic Sourcing, Vol. 15 No. 1, pp. 115-141.

Latent classes of accounting outsourcing firms

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Author: Juntunen, Jouni1; Lepistö, Sinikka2; Juntunen, Mari1
Organizations: 1Department of Marketing, Management and International Business, Oulu Business School, University of Oulu, Oulu, Finland
2Turku School of Economics, Pori Unit, University of Turku, Turku, Finland
Format: article
Version: accepted version
Access: open
Online Access: PDF Full Text (PDF, 0.6 MB)
Persistent link:
Language: English
Published: Emerald, 2022
Publish Date: 2021-11-12


Purpose: Outsourcing of accounting increasingly attracts research interest, but research concerning the impact of the benefits of outsourcing on firm capabilities and performance across firms remains limited. This paper aims to reveal the unobservable latent classes of firms that outsource their accounting functions by testing a research model concerning the topic.

Design/methodology/approach: The authors build on accounting outsourcing research and adapt a research model from the literature on business services outsourcing. The authors analyze the data from 261 small and medium-sized enterprises in Europe using finite mixture structural equation modeling (FMSEM) and additional methods.

Findings: The authors reveal three latent classes with different research models. Thriving outsourcers (N = 103) have a positive attitude toward accounting outsourcing and associate competitive capabilities with mediating the relationship from outsourcing benefits to firm performance. Annoyed outsourcers (N = 143) are dissatisfied with their accounting service provider and only associate outsourcing benefits with competitive capabilities. Convenient outsourcers (N = 15) feel comfortable with their current accounting service provider and associate outsourcing benefits with neither capabilities nor with firm performance.

Research limitations/implications: The study initiates the discussion about the unobservable heterogeneity among accounting outsourcers. The study introduces the use of the FMSEM method in accounting outsourcing research.

Practical implications: The study offers novel insights concerning accounting outsourcers and proposes original explanations for their outsourcing decisions that would help both the outsourcers and accounting service providers.

Originality/value: The study might be the first to categorize accounting outsourcers using FMSEM.

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Series: Journal of global operations and strategic sourcing
ISSN: 2398-5364
ISSN-E: 2398-5372
ISSN-L: 2398-5364
Volume: 15
Issue: 1
Pages: 115 - 141
DOI: 10.1108/JGOSS-02-2021-0019
Type of Publication: A1 Journal article – refereed
Field of Science: 512 Business and management
Copyright information: © 2021, Emerald Publishing Limited. The final authenticated version is available online at