cpatrendlines.com/2008/05/19/4-new-rules-for-the-tech-s -
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Published on: 5/1/2008
Last Visited: 9/13/2008
For that, we went to John Higgins (pictured), CPA, CITP.John is a strategic advisor to CPA firms through his company, CPA Crossings LLC in Rochester, Minn.He is also a past chairman of the Michigan Association of CPAs and a member of the AICPA Business & Industry Hall of Fame.
After talking with Higgins, we can boil it down to four rules and four trends.
Four Tech Rules
Rule 1: Match technology budgets to your long-term strategy.Identify, analyze and prioritize the technology initiatives that are required to achieve the firm's strategic goals and then assess the state of the firm's current technology.Finally, perform a Gap Analysis to determine where the firm currently stands, relative to where it wants to go and the technology required to get there.Importantly, Higgins adds, "A technology plan should also include a timeline and a budget."
Rule 2: Think digital first.And Higgins doesn't use the term "paperless.""Rather than referring to a paperless system, I prefer to use the term ‘digital practice model.'" This means that a firm creates digital files and keeps these files digital."Some firms define themselves as paperless because they scan their clients' tax returns into PDF files," Higgins notes."Yet, there may still be stacks of paper in their offices."
The efficiencies of a digital office are numerous, including having access to information immediately, accessing information by multiple people simultaneously and automating routine tasks."A firm may experience an increase in efficiency between 15% and 30% using a digital practice model," Higgins says.
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"This person," says Higgins, "should have experience in managing people since they will have a team of people reporting to them and they must understand the business of accounting in order to be successful."
Rule 4: Get the most from what you have."Firms need to utilize their current technology investments," says Higgins.Many do not know about all of the capabilities of the hardware and software that they already have.With a good technology plan, firms can spend funds on only what they need and then get the most of out what they have."I've met with a lot of firms that have purchased various software programs over the years that are not integrated into their processes on a coordinated basis," Higgins says.
Four Tech Trends to Watch
That said, the tech landscape changes rapidly.Higgins is keeping an eye on four emerging trends that every CPA firm should also be watching.
Trend 1: Scanning.Most every CPA office now has a document scanner for creating digital copies of physical documents for electronic filing.But the technology is getting smarter.For example, Higgins, says, "you can scan a W-2 and the technology will recognize the W-2 and place the income amount automatically into the person's tax return."However, he remains less than completely comfortable with the reliability of the technology as it stands today."But we're headed in the right direction."
Trend 2: Web conferencing.With gas prices at or above $4 per gallon, there are tremendous advantages to being able to meet remotely with clients, whether it's across town or across the country."Everyone can view documents simultaneously online," Higgins says.
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Web-based applications, also called software-as-a-service (SaaS), offer several big advantages to software-on-a-CD, including the shortening of implementation time, the elimination of high start-up costs, as well as providing a high level of security that firms cannot replicate internally, according to Higgins.
HOW TECH-SAVVY IS YOUR FIRM?
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