Though paper may be a security blanket for some firms, digital documents present compelling opportunities and challenges. The accounting profession has been one of the last to adopt digital content management systems, and clients are starting to voice opinions about how firms can improve service offerings and security.
Consumer electronics are driving demands for business technology. In the past, advancements in business technology resulted in a great deal of new technology in the home.
Today, search capabilities, portals, social networking and videos are exposing your clients to new ways of utilizing technology. Is your firm a leader, late adopter or resister when it comes to technology?
Clients are increasingly exposed to technology and workflow systems that exceed what many firms have available. Consider that your clients are already accessing all of their banking, investment, insurance, and mortgage information online through self-service sites. They expect the same convenience from their accounting firm. This can free up a lot of time for your employees and eliminate paper statements and reports. Yet many accountants still fight electronic filing of tax returns and write or print all checks.
While this is not the real issue, it demonstrates that many firms still view technology as overhead rather than a strategic asset.
Why the demand?
Clients will soon demand portals for several reasons, and firms must lead in this technology or get left behind. Most clients have multiple advisors—particularly if you include the medical profession—but few have a secure web portal to store and access important documents. Portal capabilities are becoming increasingly available, and it’s only a matter of time before clients embrace them. You must understand that those who administer a client’s portal will invariably become that client’s primary advisor.
Why should accounting firms offer portals?
Consider the difficulties of obtaining client information and presenting the finished product. Tax return preparation is a good place to start, but don’t be limited to just that.
Aggregation plays a big role in obtaining client data, and tax portals improve the delivery and experience for clients. Business portals for write-up, payroll processing, compilations, reviews, and audits all have relevance. Leading firms are rapidly learning that clients love these services.
The other benefit is that portals force firms to rework legacy processes involving paper that are no longer efficient in a digital world. Let me provide some specific examples.
Aggregation of client data (financial institutions, employers, K-1s, and etc.)
Prepared by clients work papers
Electronic organizers where data transfers automatically to tax software
Checklists and project plan, including budget, scheduling, and timeline. Progress billings
Scanning of documents with zone recognition
Confirmations and representation letters
One-way work flow (eliminate loops in the process) and track projects
Trial balance and/or financial statements
Electronic filing (Federal and State)
Publishing tax returns and source documents to a secure portal – eliminate paper copies.
Unfortunately, many firms use email for some of these tasks. Privacy and security laws prevent this in many states. Portals provide a secure environment for the storage of documents.
They also can offer aggregation services and integrate with various applications such as tax return preparation or financial reporting.
Follow these steps:
- Assign an internal task force of no more than five people. (Firm management, tax, audit and IT should all be represented.)
- Define objectives, the economic model and explore solutions.
- Identify a project manager (preferably not IT); establish a timeline, budget, train and implement.
- Launch a pilot with selected clients.
- Make adjustments, execute marketing plan and roll out to entire client base.
Your reaction may still be, "Why change? Our firm is already profitable.” First, consider the efficient use of your team members. Technology is an accelerator and allows you to leverage people. Second, note that many clients are starting to pressure firms regarding their systems, workflow and efficiencies.
As with any new technology implementation, documenting and enforcing policies and procedures are critical—as is training. Early adopters will reduce costs, leverage personnel and improve client service.