Selection, Security and Scalability for every Digital Accounting Practice

From Cloud softwares to Making Tax Digital to advisory services - accounting businesses has evolved faster in its journey to go digital from just a traditional accounting firm. Since pandemic accounting practices are working remotely all around the world supporting their clients on assessing tax liabilities, accounting & limited company compliances and preparing cashflows for applying funding available from various government grants and furlough schemes, Paycheck protection program etc.

One thing that has helped businesses in accounting, bookkeeping and taxation is adapting digital solutions in their business. Accountants talk about #techstack, #digitaltools #virtualcfo etc. but do they actually be a Digital Accounting Practice?

To analyze on this I have narrowed down to three main things as a checklist for any accounting practice to work fast, upgraded and effective digitally. Following are those items:

Selection

Accountants needs to prepare a preference list of cloud softwares they would want to use for their clients. process of selecting software should be detailed down keeping in mind on whether it is useful to majority of your clientele?, do they have add-ons like providing practice management tools, compliance tools, plugins to offer various automation like auto invoicing, fetching expense receipts from vast majority of suppliers through cloud etc. Practices needs to identify whether they need a single cloud software solutions for most of their services or they need multiple cloud solutions in business for their tailored services to clients? obviously these also brings needs to consider the cost to business for subscribing softwares etc.

In my view, the lesser the subscriptions and optimum utilization of your subscribed softwares and its features is a wise choice for long term planning. Being an digital accounting practice you would known by your clients through two main things - your services and your cloud solution to them. so you don't want to be invested in every other software and not be master in any of them to make it effective

Security

Your cloud software should be secured enough to store your client's sensitive information. This means whether you choose between Xero, QuickBooks, Kashflow or TaxCalc, IRIS or TaxFiler you need to ensure how secure your software is?, how much secure is your client data? Just by signing up with one of the cloud software does not make you secure. To understand security think of following things:

1. How secure are their Data centers where your information is stored.

2. Do you have a back-up of your software? - yes you can get back-ups of your cloud storage information as a security. This is vital too in your compliance checks in Data Protection Policy.

3. When you give access of your software within your team and with your supplier and clients - Do you periodically verifies them and upgrades the access?

4. Do you have Two-steps verifications enabled for accessing softwares? Xero just announced MFA for their clients to secure logins.

Scalability

This means how efficient and optimally you use your softwares. Cloud softwares are the best drivers of growth in accounting business. How do you know whether you are scaling your business through cloud? Following are the steps to verify the scalability according to me:

• Automate - No more paperwork. It is not worth to do monthly and quarterly bookkeeping where you process sales, purchases, bank, payroll etc. repeatedly. you need to let the software do the redundant task through integrations and APIs with banks, and suppliers to get your invoices, receipts, banking's in your software. Let software do the repeated mailers to follow-ups. Automation can let you grow with high pace when you Choose and implement the right software for your business.
• Cost Analysis - Try and analyze the cost to your business on tasks that you can rather let the software do it and minimize your time and money behind it. For example - admin work like getting client contact details up-to date, ensuring you have 64-8 for new client signed up, engagement letters and mailers to client to ask for information to start accounts and tax returns.
• Connecting - when you use cloud softwares it lets you focus on advisory services for your clients. If clients needs working capital funding or funding for cap-ex you can use softwares to connect with add-on features or apps that will enable you to get cashflow generation, comparing funds or loan availability, analyzing interest rates and plan repayments.
• Real-time insights - Although this is a commonly used term now among accountants, but how often you get real-time insights? are you able to complete monthly book-keepings on time that will get you information when needed? By following above steps you should be able to get the real-time information on your accounts and use it for your business.

Hope you liked the above checklist which can drive growth to any accounting practices. If you know any more insights to this please share it with me and I could add more on Digital Accountancy.