Internet: Revolutionizing How CPAs Do Business
By Ken Garen
MAY 2007 - The
Internet has forever changed how CPAs do business, in ways more
far-reaching than the horseless carriage’s impact on our culture,
or the telephone and fax machine’s impact on how we communicate.
In the mid-1990s, few people had even heard of the Internet. Now
the fax machine, revolutionary in the mid-1980s, is becoming obsolete
as the Internet becomes the technology of choice for transmitting
documents and information cheaply, quickly, and efficiently.
a Small World
has changed how CPAs and accounting firms do everything, from
communicating with clients to hiring and retaining employees.
Its ability to connect people instantly has freed both client
and accountant from the limitations of both time and space. Exchanging
information across the globe has become as simple as if both parties
were sitting across the table from each other.
the need for physical proximity also frees firms from the requirement
of hiring employees locally. Staff can live and work anywhere
while remaining immediately connected to their jobs via the Internet.
Communicating with clients, managers, or coworkers means sending
e-mail, making a telephone call via voice-over-Internet protocol
(VOIP), or sending an instant or video message.
to conduct business globally includes methods for staying connected
using a virtual meeting space. Online meeting software, like gotomeeting.com
and webex.com, allows participants to share voice, video, and
data instantly. This software allows everyone via an Internet
connection to participate in an online “live” meeting.
These services even enable presentations and demonstrations on
virtual whiteboards. Get-togethers with customers and employee
training sessions can now be efficient and far less expensive
if employees and clients do not have to travel. Plus, the services
eliminate unproductive travel time, with its unforeseen delays
and occurrences. Though some may argue that being able to work
and connect anywhere at any time has resulted in the offshoring
of jobs and the depersonalization of human interaction, others
make a case for efficient, cost-effective use of resources.
a Fast, Paperless World
world may have seemed impossible a few years ago, but the Internet
has made this a reality. Paper no longer must be printed, photocopied,
and delivered via messenger service, postal service, or overnight
air courier. Financial statements and reports can be delivered
electronically in an instant. Now, information is delivered via
the web and the recipient has it within seconds at no additional
cost. The long-term effect on the U.S. Postal Service and services
such as FedEx and UPS is already significant.
longer have to wait for disks, or a package containing hard-copy
documents that require rekeying, to arrive in the mail. By storing
and retrieving documents electronically, many firms have eliminated
much of their paper use and file-space needs. The cost savings
are tremendous when firms go paperless and no longer have to print,
file, purchase supplies, or store information.
agencies, never known for being on the cutting edge of technology,
have embraced the Internet. Increasingly, tax authorities permit—or
even require—filing returns and paying taxes online. This
is another reason why businesses will want accountants and specialty
service providers, such as payroll providers, to handle many transactions
for them. Eventually, the kinks will be worked out of the system
so that a potential employee’s eligibility to work can be
verified electronically, significantly streamlining this burdensome
an Efficient World
can be a wonderful tool for capturing information from clients
via file transfers. An estimated 20% to 30% of firms use this
method, which eliminates the need to rekey information. This tool
has radically changed the way businesses work. Downloading spreadsheet
data or importing information into a firm’s software suite
means tasks that used to take hours now get completed in minutes.
has also increased efficiency by giving accountants the ability
to manage a client’s computers and software, and retrieve
information from them, remotely. With the appropriate permissions
and software such as LogMeIn.com or PCanywhere.com, an accountant
can take control of a client’s computer from afar and do
everything that someone located in the office could, except physically
load discs. The CPA can virtually “visit” the client
at any time without the need for the client to be physically present.
In the future,
the electronic interchange of information will be entirely paperless
and automated. Imagine the full cycle of professional services
being completely electronic. Clients seeking services will send
an electronic request for proposal (RFP), review the responses
online, cut an electronic purchase order and have services delivered,
and then send an online electronic payment that is recorded by
both parties. Productivity will soar as firms transition to paperless
technologies and automatic processes.
influence of the Internet has transformed how all professionals
attract new business and retain current clients. The web has altered
the way people search out information and resources, how they
make decisions to purchase products and services, and how they
pay for them.
website can attract new business via search engines and give existing
customers new methods for interacting with a firm, including the
actual payment of invoices. There has already been a significant
shift from paper-based payment by businesses and individuals to
electronic payments. This has changed the way back offices work,
too; even though electronic fund transfers still need to record
what the payment is for, many systems fail to include a notification
field, a regrettable oversight that complicates online transactions
for the payee.
offering a new way to search out information about an accounting
firm, the Internet has given CPAs ways to learn more about their
own profession. Not only can accountants proactively find local
and distant continuing-education courses to attend in person,
but the ability to earn continuing-education credits online is
rapidly becoming available, a great convenience for accountants
important thing that the Internet has done to change how CPAs
do business is its irrevocable transformation of expectations.
There’s no need to wait days for information; everyone now
expects immediate results. Customers, accountants, and employees
have realized that “fluff time” is gone. A CPA can’t
promise to do something today and send it in tomorrow’s
mail. With immediate delivery via the Internet, accountants must
manage client expectations in different ways.
expect clients to be able to submit their data electronically.
Many accounting firms have been contemplating how to price their
services to encourage electronic communication and discourage
paperwork. This will continue to reform the way accountants approach
current and future business methods and client relationships.
Businesses that rely on paper are simply not as profitable as
those that take advantage of electronic media.
have increasingly high expectations for staff. The professional
toolkit required by employers now reaches beyond the ability to
simply crunch numbers. Employees must be skillful at extracting
data and researching information. Candidates with these competencies
command better compensation, and seek out firms that fully engage
their Internet-based capabilities.
its benefits, the Internet access is still not fully embraced
by all accounting firms. But much like the green eyeshade and
the quill pen, these firms will soon become relics of a nostalgic
past. The Internet, with its revolutionary innovations, has already
made its mark.
Garen is the founder and president of Universal Business
Computing Company (www.UBCC.com),
a software development firm of high-end accounting and payroll