Why staying on top of technology and out of the box thinking is crucial for accountants and their clients.

From the Intuit’s Runner Up (top 15 globally) of the Firm of the Future, Tatiana Tsoir,CPA,MBA of Linza Advisors

Having been in bookkeeping and then accounting since 2005, I’ve worked with various software packages like QuickBooks, PeachTree, NetSuite, Mint, Microsoft Money and Quicken, and that doesn’t include any tax packages. I’ve seen many applications significantly improved and made exceptional, while others are no longer used and are out of business. It’s true that technology changes so quickly that many of use cannot keep up; and over the years I’ve come across numerous clients and accountants, who refuse to adapt to the technological innovations.

A few years ago I went to talk to a potential bookkeeping client, David, a referral from my tax guru. Even though I personally do very little bookkeeping nowadays, I’m often involved in the set up, problem solving, “clean up” of a business’ books, mostly due to my experience and bookkeeping efficiency, coupled with strong accounting knowledge & experience. David was looking for a bookkeeper to come by 2-3 times a week and update books, reconcile accounts, pay bills. I was too expensive, and, frankly, overqualified for what he needed. David shared that his prior CPA used to manage his books and records monthly, but day to day transaction posting David managed himself with QuickBooks Online (QBO). Then his new CPA switched him to Quickbooks Desktop, which David hated (after using QBO for 3 years).

I wasn’t at all surprised. Many hard-core, years -in- business CPAs aren’t up to date with technology, and don’t like change that comes with it. It’s not uncommon for anyone to dislike change, however, it is no longer acceptable. As a disclaimer, I must say that, yes, there were times when I also disliked QBO, way back when it was a pain to work with. But that was 10 years ago, almost and things have changed since then.

What are clients looking for now?

Today younger clients want a CPA who is more than just a once-a-year Tax Guy/Girl. I have numerous millennial clients, who are moving their start ups forward, getting funding, needing cash management. Did you know, that according to Forbes, #2 reason for start up failure is running out of cash (#1 is no market for the product)* ? As odd as it may seem, start ups learned to address the “funding” issue well, but not the “management” issue. So besides tax compliance, today’s businesses want business management help, which is where a CPA comes in and makes a positive change.

Truth be told, many “tax guys/gals” take on so much work, that actually helping a business manage cash flow and find ways to educate the owners to become top-notch CEO’s doesn’t get a regular spot on a CPA’s calendar - many of us are so busy servicing the current clientele in hopes of maintaining our lifestyles, that this “minutiae” often gets pushed back as unimportant. And that’s a trap!

Over the past few years I’ve been getting more and more clients for Controller/CFO management (thanks to my MBA for additional management, marketing and organizational psych training), and many have then switched to me from their prior CPA’s or EA’s for tax work as well. Yup! I offer them a comprehensive approach AND I am not afraid of utilizing technological innovations, every day. At a certain point these start ups may need a full time CFO/Controller, with which I help them, but many still keep me around as a sounding board.

So what’s the secret sauce?

First of, for whom? For the clients that would be finding an accountant who is a proactive problem solver and is not in denial of technology. It’s very true that often times we know more and have better tools for your business; but it does seldom happen that you can “Google” better. Google is a very powerful tool, and younger generation starts their search for ANYTHING these days with a search engine. This approach does come with a caveat: don’t confuse Google with an accounting degree & a CPA license. The biggest danger, I think, with taxes especially, is not knowing what you don’t know. Being able to find an “answer” online gives you a false sense of confidence, which can later result in finding the wrong people (bookkeepers/accountants/attorneys), wasting resources on unnecessary services, a triggered tax audit, business inefficiencies and a possible failure.

If you are a business owner, I recommend doing some basic thinking: know what you want - it’s mission critical; figure out what it is you are selling (product, service, vision), and maybe even come up with a mission statement for your business. The next step is very important: think about what you plan to do with your business in 5-10-15 years. What is your exit strategy? Is it building the business up and selling it? Is it building it and operating it “forever”? Your business & tax strategy, legal structure and business plan, AND vision will differ, depending on the path you choose. After that you can consult a CPA to make sure your vision aligns with your legal and tax structure, and define the next steps.

For the accountants, being in technological denial is not an acceptable practice, especially if you are just entering the profession or building up your accounting business. I worked with someone about 12 years ago (a marketing guy with little accounting knowledge at the time), who, a decade earlier, got into accounting and bookkeeping by adopting a problem solving approach and by embracing technology. He was a trainee/junior bookkeeper at the time at a firm and his boss has quit unexpectedly. Next thing you know, he went to the CEO and offered to do her job for half the money. And he did! Over the years he educated himself in accounting extensively, took on all challenges thrown his way and, when I met him, was successfully billing small business clients at $75-100 per hour for high-end bookkeeping services. Not bad for a guy with a B.A. in Marketing, I say. How many people with accounting degrees actually do that?

Where is the future for accountants?

On September 12, 2018 Intuit announced it’s Top-15 2018 Global Firm of the Future nominees, of whom it also selected Top 5 (1 per each country/region). My firm, Linza Advisors, was a Runner Up this year, and was featured at the press release by MarketWatch & Business Wire **. When Was applying for this contest, I was asked to describe a situation, where I used technology to make a small business client’s company more successful. For about 4 years now I’ve been working with one terrific CEO of a retail business, Michael. For years, Michael has used a monster-excel sheet (with over 70 tabs!) to analyze fluctuations in cash, project out a season or a year, budget and as means of control over the company’s expenses. The excel was great, it worked for a number of years, but Michael’s business has outgrown it, unfortunately, plus this tool did not provide a readily available comparison of budget vs. actual and had other, more technical, limitations.

Meeting this CEO changed my business life. Instead of rushing through it (as I was used to), I saw an opportunity to be a problem solver and I did it. QBO (QuickBooks Online) had a Budgeting tool, which addressed some of the needs (Revenue and expense side), but not others (liability payments and projections). With a few tweaks to this Budgeting feature, I was able to utilize this tool to build a comprehensive cash flow projection model, which we use to this day.

After a month-end close, I run reports and we look at the Budget vs. Actual comparison, which we analyze for inconsistencies and overspending, as well as reasons for those. At some point, Michael discovered, thanks to this tool, that his common carrier changed the way shipping rates were calculated and Mike was spending double or triple the dollars on shipping costs! Furthermore, we avoid missed formulas and extra column issues with everything being calculated automatically.

There are numerous tools out there, which can help accountants save clients’ money and time, maximize their efficiency and help ensure their success. All it takes is a dash of a desire to be a part of the clients’ teams, while embracing technological innovations. Technology is an integral part of our professional and personal lives and it’s up to us to make the best of it.

*  https://www.forbes.com/sites/niallmccarthy/2017/11/03/the-top-reasons-startups-fail-infographic/#1013dc2b4b0d

**. https://www.businesswire.com/news/home/20180912005690/en/