Examples of back-office tasks include IT departments that keep the phones and computers running (operations architecture), accounting, and human resources. These tasks are often supported by back-office systems: secure e-commerce software that processes company information (i.e. a database). A back-office system will keep a record of the company’s sales and purchase transactions, and update the inventory as needed. Invoices, receipts, and reports can also be produced by the back-office system.
In banking, the back office includes a heavyweight IT processing system that handle position keeping, clearance, and settlement. In investment firms, the back office includes the administrative functions that support the trading of securities, including recordkeeping, trade confirmation, trade settlement, and regulatory compliance. If used in sales, the back office would include functions that fulfill customers’ orders and would usually include the duties involved in customer-support call centers.
Back offices may be somewhere other than the headquarters of a company. Much of the time they are in areas and countries with cheaper rent and lower labor costs. Back office functions can be outsourced to consultants and contractors in any country.