CPA Practice Advisor

OCT 2018

Today's Technology for Tomorrow's Firm.

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Page 7 of 47

8 OCTOBER 2018 ■ This month's focus is on cloud accounting - what you need to know within your own firm as well as information that will be helpful to you in guiding your clients. In addition to information about best practices to make your practice more profitable, this issue includes a special cloud section starting on page 22, featuring the most notable comapnies offering cloud solutions to accountants. FEATURE THE CLOUD: Streamlining Workflow and Automation By Chandra Bhansali, Ph.D. The advent of PCs made performing computations tremendously fast and easy. But a major limitation of the desktop was that it lacked capabilities for streamlining the primary processes involved in accounting and payroll. That limitation made offering bookkeeping and payroll services very cumbersome and inefficient. That’s why most accountants today refrain from offering these services. The cloud has finally changed that. It enables accountants to streamline the workflow involved in these services. That’s why tens of thousands of accountants who did not previously offer payroll services are now offering highly profitable payroll services. Client accounting services (CAS), which involve transaction processing and bookkeeping, has become a fast-growing practice area, precisely because of the level of automation and workflow capabilities made possible by the cloud and other technologies. With a desktop system, bill payment and bookkeeping for a substantial number of clients is a daunting task. Getting invoices and source material, entering data, and printing and mailing checks are labor-intensive tasks. There is no easy way to have the client approve payments. Offering outsourced CFO services is virtually impossible, or its scope is very limited. But with the right cloud solutions, accountants can overcome all these problems and make offering CAS easier and much more profitable. As an example of how accountants might leverage the cloud’s capabilities, clients can just scan or take a snapshot of invoices to be paid using an app. Those images go into a document storage system, where an optical character recognition (OCR) system picks up the images of those invoices. OCR is not perfect yet, but advanced cloud systems can parse important data like vendor name, invoice amount, etc. with increased accuracy. Invoices where the system is 100% confident about accuracy would be automatically entered into the accounting system. Remaining invoices can be routed for manual confirmation. This process can reduce data entry time by 60 to 70 percent, industry-wide. Once invoices have been entered, they can be sent to a business manager to decide which invoices should be paid fully, partly, or later. Once staff gets client approval, they can pay hundreds of invoices for a number of clients with a few mouse clicks using digital checks. Continued on page 15

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