There's been so much written, so many conferences, so many webinars about cloud accounting in the last couple of years that you'd almost think that there's nothing else important for accountants to think about.

Are You a "Today" Accountant?

To me, the interesting thing is not the technology but the opportunity for firms to radically alter how they engage with clients and the services that they provide. All too often I see firms moving to new technologies but not altering their underlying business model.

For accountants, one of the big transformative changes delivered by cloud computing is the ability to share in real time the accounting ledger with the client. From a compliance processing perspective this is delivering significant efficiency gains. The challenge of moving data between accountants and clients is eliminated. The challenge of keeping accountants and clients accounting data in sync is eliminated. Rekeying of client data into accounts production systems is disappearing. So efficiency of the year end compliance work is being transformed.

But for the firms that want to truly capitalise on cloud computing, we need a change of mindset to move to a "today" accountant.

A "today" accountant is looking to change from once or twice a year updating of client's accounts to daily processing with the ability to provide a client with a snapshot of their business, their superannuation fund, their investments each day. A "today" accountant is looking at the data to find issues in their client's business or investments as they are occurring rather than once or twice a year.

This is a very different way of working. It's about systems and processes. It's about client education. It's about changing the way accountants and clients engage. For the last 20 to 30 years there's been discussion about accountants being the external CFO for their clients. You can't be an external CFO if you only look at the numbers a couple of times a year. Regular engagement is required. Cloud computing is providing the means engage regularly and cost effectively.

To become a "today" accountant you need to make maximum use of the technologies available. Automation of the accounting process is needed. Automatic data feeds are a critical component. Are the feeds reliable? Do they automatically reconcile? Some feeds for example also send the daily balance along with the transactions so that the system can report when the balance has not reconciled. Can feeds from multiple sources be obtained to allow for automatic matching and posting of transactions? In some SMSF Administration Systems for examples feeds from brokers, wrap accounts, ASX and other organisations can be automated to eliminate any need for classification and posting. Most modern accounting systems also now have sophisticated rule based processing using transaction descriptions in bank feeds to enable automatic processing. Have you spent the time to ensure all the possible feeds are set up for your clients and all the possible transaction rules are established? Only by ensuring that these are in place can you provide a cost effective, efficient service.

The next step is to transform your processes. Do you have staff monitoring your client's accounting daily? Some systems will provide a view of all clients on the system highlighting all the entries and issues that may require attention. In just a few minutes each day transactions can be processed so that the client's accounts or investment portfolio is fully updated.

Are you then making this information available to your clients? Can they login to your website or directly onto the accounting platform to review their finances or business performance?

And lastly, are you educating your clients? I suspect many accountants may feel that their client doesn't want a "today" accountant. Many clients may not be all that interested in their business accounting or investment portfolio. Accountants will need to spend time with these clients to help them understand the benefits of up to date accounting. The goal is to move clients to appreciate the benefits and for them to become more engaged. It will only be from this greater engagement by clients that accountants can truly deliver on the promise of being a client's external CFO.

So conduct a pilot. Select a few clients. Get the data feeds and transaction rules established. Monitor daily to ensure the data is up to date. Make the data available to your clients via your client portal and talk to your clients about the benefits, what the data means and how you can help them be more proactive in their business and financial management.

I suspect as the years go by and as Gen Y moves into senior management, we will see this tech savvy group demanding that their accountant is a "today" accountant and will fail to understand why they can't see real time updating of their financial affairs.

So rather than just adopting these new technologies into your traditional business model think about how you can transform your firm so that you can become a "today" accountant.

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David Smith