2021 Strategic Technology Outlook for Accounting Firms
Transcript of 2021 Strategic Technology Outlook for Accounting Firms
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2021 Strategic Technology Outlook for Accounting Firms
Presented by Roman H. Kepczyk, CPA.CITP, CGMA
Director of Firm Technology Strategy, Right Networks
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Roman H. Kepczyk, CPA.CITPDirector of Firm Technology Strategy- Right Networks
Top 100 Most Influential People in Accounting
(15 Years)
Most Recommended Consultants(15 Years)
Lean Six Sigma Black Belt
Top Thought Leader 2011-2020
CPAFMA Public Accounting Firm Manager and Advisory Board Member
Strategic IT/Production Partner to more than 425 CPA Firms (24 Years)
IT/Administrative Partner for Regional CPA Firm (10 Years)
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Agenda 100% accounting focused
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AboutRight Networks
2021 WINNERS: Right Networks
*ASP / Hosted Solution Providers .*Outsourced Technology Solutions
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Agenda Strategic Technology Outlook
“New” Normal Post COVID
Express IT Update
Remote Work/Collaboration
Process Transformation: LEAN
CAAS Tech Stack Supports Advisory Focus
Changing IT Team Roles
Security Prioritization
Disrupter Awareness
…Provide Resources/Benchmarks
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"New" Normal Post COVID
When will we be “Post” COVID? …already there! …this fall? ...2022?
Firm view on re-opening
Resurgence in hot spots
Emergence of vaccine-resistant variants
*AAA Interactive COVID Restrictions (May 11, 2021-June 2, 2021)
https://cpafma.org/articles/guide-re-opening-cpa-firm-released
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"New" Normal Post COVID
When will we be “Post” COVID?
Significant changes driven during COVID: Forced innovation/adaptation
Remote access technology ramped up
Rapid adoption of digital solutions
Acceptance of virtual collaboration
Remote work increased productivity for many
Surge in traditional compliance services
“New” Normal: depends on going BACK or going FORWARD
Technology transformation accelerating towards “Next” Normals
…winners will be those that can identify, adapt, and drive their firms forward!
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Express IT Update
Migration from On-premise to Cloud: 38% Host the majority of their own servers and
applications within their own firm office(s)(40% in 2018, 77% in 2016)
4% Host the majority of their own servers and applications at an external colocation and do their own maintenance (4% in 2018, 6% in 2016)
7% Utilize an external accounting vendor to host the majority of applications at their vendors facility. (4% in 2018)
51% Utilize an external integrator* to host the majority of firm applications at their facility and do all maintenance (51% in 2018, 18% in 2016)
(*71 of 90 responses: Right Networks)
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Express IT Update
Migration from On-Premise to Cloud
Workstation Refresh
PC vs. Macintosh
iMAC 24” with 4.5K Display
Apple M1 Chip onboard 16Gb RAM
512GB storage: $1,899
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Express IT Update
Migration from On-Premise to Cloud
Workstation Refresh
PC vs. Macintosh
Specifications (Processor, RAM, SSD, USB-C)
i7 (58%), i9 (9%) Intel Processor
16Gb RAM (8Gb+ for Cloud*/Audit)
Solid State Drives on ALL workstations
USB-C
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Express IT Update
Migration from On-Premise to Cloud
Workstation Refresh
PC vs. Macintosh
Specifications (Processor, RAM, SSD, USB-C)
Desktops vs. Laptops
Disaster Recovery
Managed Remote Workstation
Consulting/Remote Work Mobility
(2020 CPAFMA DDF Survey)
63% 15.6” with built in number pad
21% 17” with built in number pad
13% 14”+ without number pad
2% <14” (Ultrabooks/Microsoft Surface)
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Express IT Update
Migration from On-Premise to Cloud
Workstation Refresh
PC vs. Macintosh
Specifications (Processor, RAM, SSD, USB-C)
Desktops vs. Laptops vs. Hybrids
Optimized Displays
53% Triple
27% Dual Oversize (>20”)
13% Dual Standard (<=20’)
5% Quadruple
2% Single Mega-size
(30”or greater!)
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Express IT Update
Migration from On-Premise to Cloud
Workstation Refresh
PC vs. Macintosh
Specifications (Processor, RAM, SSD, USB-C)
Desktops vs. Laptops vs. Hybrids
Optimized Displays
53% Triple
27% Dual Oversize (>20”)
13% Dual Standard (<=20’)
5% Quadruple
2% Single Mega-size …UBER GINOURMOUS!
(30”or greater! MS PowerToys)
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Express IT Update
Migration from On-Premise to Cloud
Workstation Refresh PC vs. Macintosh
Specifications (Processor, RAM, SSD, USB-C)
Desktops vs. Laptops vs. Hybrids
Optimized Displays
53% Triple
27% Dual Oversize (>20”)
13% Dual Standard (<=20’)
5% Quadruple
2% Single Mega-size (30” or greater!)
Mobile Displays?
ASUS Zen/MB169 B+ $169
HP/Lenovo/GeChic
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Express IT Update
Migration from On-Premise to Cloud
Workstation Refresh
PC vs. Macintosh
Specifications (Processor, RAM, SSD, USB-C)
Desktops vs. Laptops vs. Hybrids
Optimized Displays
53% Triple
27% Dual Oversize (>20”)
13% Dual Standard (<=20’)
5% Quadruple
2% Single Mega-size (30” or greater!)
Mobile Displays
Future???
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Express IT Update
Migration from On-Premise to Cloud
Workstation Refresh
PC vs. Macintosh
Specifications (Processor, RAM, SSD, USB-C)
Desktops vs. Laptops vs. Hybrids
Optimized Displays
Microsoft Windows
97% Windows 10
2% Windows 7
0% Apple iOS
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Express IT Update
Migration from On-Premise to Cloud
Workstation Refresh
PC vs. Macintosh
Specifications (Processor, RAM, SSD, USB-C)
Desktops vs. Laptops vs. Hybrids
Optimized Displays
Microsoft Windows/Office (2020 CPAFMA IT Survey)
77% Office 365 (now Microsoft 365)
4% Office 2019
15% Office 2016
4% Office 2013/2010/2007
2019
Microsoft 365:
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Express IT Update
Migration from On-Premise to Cloud
Workstation Refresh
PC vs. Macintosh
Specifications (Processor, RAM, SSD, USB-C)
Desktops vs. Laptops vs. Hybrids
Optimized Displays
Microsoft Windows/Office/Adobe? (2020 CPAFMA IT Survey)
51% Adobe 12/DC
20% Adobe 11 (exp. 10/20/2017)
8% Adobe 10
21% Other (older Adobe, Doc-It, FoxIT)
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Express IT Update
Migration from On-Premise to Cloud
Workstation Refresh
Scanning Technology
Scanners vs. Duplicators
Educate Clients on Portal/Secure Email Solutions
% of Tax Scanning done Centrally, Distributed or Individually:
-88% Firms Utilized Centralized Scanning (2018: 84%; 2016: 75%)
-57% Used Distributed/Shared Scanners (2018: 79%)
-51% firms used some Individual Scanners (2018: 55%)
*CPAFMA 2020 DDF Survey
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Express IT Update
Migration from On-Premise to Cloud
Workstation Refresh
Scanning Technology Scanners vs. Duplicators
Educate Clients on Portal/Secure Email Solutions
79% Tax File Organization Scan (2019: 76% +3%)
69% Utilize OCR into Return (2019: 56% +13%)
Tax File Scan and Import Tools
CCH FxScan/AutoFlow
Thomson Source Document Scanning
SurePrep 1040 Scan and Populate
Drake Gruntworx/Populate *CPAFMA 2021 DDF Survey
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Remote Work/Collaboration
Ubiquitous Internet (95%+!)
Redundant Firm Internet
Different Backbone Providers
Dual Broadband Router with Automatic Failover
Renegotiate 18-24 months-$$$
CPAFMA 2020: 46 firms experienced significant downtime due to:• 21 Internet Outage• 20 Cloud Host Outage• 12 Hardware Failure• 2 Ransomware/Malware• 1 Power Outage
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Remote Work/Collaboration
Ubiquitous Internet (95%+!)
Redundant Firm Internet
Difficulty with Client WiFi/VPN
Increased security concerns
Caution on “Public/Client” WiFi
Utilize Virtual Private Network: (i.e. Cisco AnyConnect, NordVPN, IPVanish, ExpressVPN)
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Remote Work/Collaboration
Ubiquitous Internet (95%+!)
Redundant Firm Internet
Difficulty with Client WiFi/VPN
Digital Cellular Options
Smartphone Hotspot
Mobile Hotspot
Recent Renegotiation
Small Office Backup
V1-$399-30 users-5G!
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Remote Work/Collaboration
Ubiquitous Internet (95%+!)
Redundant Firm Internet
Difficulty with Client WiFi/VPN
Digital Cellular Options
Transition to 5G
4G=30Mbps HD Streaming
5G=60-1,000Mbps GB Streaming
Will handle VPN/Security
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Remote Work/Collaboration
Ubiquitous Internet (95%+!)
Redundant Firm Internet
Difficulty with Client WiFi/VPN
Digital Cellular Options
Transition to 5G
Collaborative Future
Skype/Zoom to Microsoft Teams
Slack/SocialCast to Microsoft Yammer
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Remote Work/Collaboration
Ubiquitous Internet (95%+!)
Redundant Firm Internet
Difficulty with Client WiFi/VPN
Digital Cellular Options
Transition to 5G
Collaborative Future
Skype/Zoom to Microsoft Teams
Slack/SocialCast to Microsoft YammerBlue Yeti Microphone
Logitech 1080p Camera
Adjustable DesktopClamp Stand
Light Box
MeetingOwl
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Lean Accounting Process Solutions
LEAN SIX SIGMA Overview
Targets Improvement of WORKFLOW
Structured Process (DMAIC)
Consulting Skills/Tools that Accountants can utilize
Visual Flowcharting with focus on end client
Individual/Group Accumulation (Facilitation Skills)
How to measure anything (KPIs*)
*KPIs-Key Performance Indicators
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Lean Accounting Process Solutions
LEAN SIX SIGMA Overview
Internal: KPIs* Direct Efficiency
Total Days in Firm
Profit Margin
Return Completed Without Rework
Audit PBC Complete Before Going Onsite
Digital Delivery (Return, Engagement Letter, Invoice)
Continuous vs. Discreet
Lean Tax Process Opportunities
*KPIs-Key Performance Indicators
Continuous (Measure):-8 Days in Production-4 Days in Scanning-$750 Margin-43% Profit-$187 Realized Rate
Discreet (Y/N):YES-Digital DeliveryNO-Sent Back Twice for Rework
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Lean Accounting Process Solutions
LEAN Tax Process Opportunities Contact Management Tax Projections Engagement Letter Due Date Tracking Organizer Production Data Accumulation Digital Workflow Scanning Technology Organize/Bookmark Tax Data Import Annotation Preparation/Workstation Research/Forms Review/Collaboration Return Processing/Delivery eSignature/extension
Goal? …capture data at its root source with quality control,
in a format that is accessible securely by everyone that needs
it, in a digital format regardless of their location!
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Lean Accounting Process Solutions
Contact Management: Solution
Identify Contact Databases/Locations
Practice Management
Outlook
Tax Program
Workflow/Due Date Tool
Engagement Binders
Engagement Letters
Marketing Lists
…hopefully not a Rolodex!
Digital Change of Address Form/Email Address
Centrally Updated by Trained Administrative Personnel
CPA CRM=Good List Management
Ask Firm Personnel: Where do they look for client contactInformation?
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Lean Accounting Process Solutions
Quality Control Opportunities:
QC at ingress/engagement letters
Optimized scanning process
Complexity stratification (in workflow)
“Mini” review at preparation (stratified checklist)
“Push Forward” return review with collaboration
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Lean Accounting Process Solutions
LEAN Resources/Articles:
Lean Tax Production
Identifying LEAN Waste-MUDA
Lean Audit Production
LEAN Consulting Skills
Right Networks BLOG
RN LEAN Firm Series: LEAN Essentials – June 11
Tax Optimization – June 21
Assurance/Accounting – June 28
Firm Administration – July 6
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CAAS Tech Stack Supports Advisory Focus
Advisory has driven profitable growth
Client ACCOUNTING and ADVISORY Services
Big Firm CAS vs. Small Firm CAS
Outsourced Controllership/Fractional CFO
Business Process Improvement (LEAN)
Business Information Automation…..
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CAAS Tech Stack Supports Advisory Focus
Advisory has driven profitable growth
Client ACCOUNTING and ADVISORY Services
Technology disintermediating traditional services
APIs, Data Transfer, Machine Learning….AI!
Source: ADP accounting profession survey
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CAAS Tech Stack Supports Advisory Focus
Advisory has driven profitable growth
Client ACCOUNTING and ADVISORY Services
Technology disintermediating traditional services
APIs, Data Transfer, Machine Learning
Automation Factories
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CAAS Tech Stack Supports Advisory Focus
Advisory has driven profitable growth
Client ACCOUNTING and ADVISORY Services
Technology disintermediating traditional services
APIs, Data Transfer, Machine Learning
Automation Factories
Big Four Entrants
YOUR Advantage?
…client relationship!
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CAAS Tech Stack Supports Advisory Focus
Advisory has driven profitable growth
Client ACCOUNTING and ADVISORY Services
Technology disintermediating traditional services
CAAS built upon accounting information systems
CAAS Cloud Tech Stack
Core Accounting App:
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CAAS Tech Stack Supports Advisory Focus
Advisory has driven profitable growth
Client ACCOUNTING and ADVISORY Services
Technology disintermediating traditional services
CAAS built upon accounting information systems
Decision support dashboards
Tableau
Domo
Microsoft Power BI
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Changing IT Roles
Internal Technology Management
Sobering Impact since 2008 …COVID repeat???
Tight Training Budgets/Investment-Limited Conference Access
One Shot Experience Outsourced (Exchange, Security, Remote, DR)
More Applications Pushed to Cloud/CAAS Adoption
Reduced Internal Technical/Support Requirements
Traditional Network IT Personnel at Top of Pay Grade
Most Partners Don’t Know How To or Want To Deal with IT Issues
CPAFMA 2020:Cloud Impacts
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Changing IT Roles
Internal Technology Management
IT Opportunities/Department Evolution
Internal Project Management
Ongoing Troubleshooting
New Process Adoption
Standardize Mobile Capabilities
Application Integration (Programming Skills)
Transition to Advisory Role
Cybersecurity Services/Training
Cloud Transition Assistance
Client Data Manipulation (Extraction/Programming,
Dashboards-Microsoft Power BI)
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Security Prioritization
Current Accounting Threats
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Security Prioritization
Current Accounting Threats
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Security Prioritization
Current Accounting Threats: Ransomware as a Service
Municipalities
Medical
Legal
Accounting
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Security Prioritization
Current Accounting Threats IRS Security Summit Response: It’s the law!
IRS Security Six: Anti-virus/Malware Application Firewalls Multi-Factor Authentication Backup Software Drive Encryption Virtual Private Network
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Security Prioritization
Current Accounting Threats IRS Security Summit Response: It’s the law!
IRS Security Six Phishing Training Security Awareness Training Written Plan: “Appropriate to your Circumstances”
Designate an employee to coordinate Security Plan development
Identify and assess risks to client information Evaluate effectiveness of current safeguards and adjust
as necessary Design, implement and monitor a safeguards program Select service providers than can maintain appropriate
safeguards
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Security Prioritization
Current Accounting Threats
Reality: YOU are responsible!
...and will be financially impacted if your firm is breached!
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Security Prioritization
Current Accounting Threats
Reality: YOU are responsible!
Firm Security: IT Responsibilities
Firewall Configurations
Security Patches
Windows/Server Updates
Antivirus/Malware
Daily Backups (Verified) (Ransomware)
Secure Access to Resources (Passwords)
End User Policies/Threat Awareness (Phishing)
Consistent Deficiencies:
* 2021 Verizon DBIR: Data Breach Investigative Report
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Security Prioritization
Current Accounting Threats
Reality: YOU are responsible!
Firm Security: IT Responsibilities
Security Solutions/Recommendations
Password Wallets
New Password Rules: at least 12 characters, no derivatives: Passphrase
Data Blue 1040 SundayNotHackedOnMyWatch
4Sc0re&7YEARSag0
~PhX!cc01, PhX!cc02, PhX!cc03…
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Security Prioritization
Current Accounting Threats
Reality: YOU are responsible!
Firm Security: IT Responsibilities
Security Solutions/Recommendations
Password Wallets
Multi-Factor Authentication
Software: DUO, Okta
Key Fob/RFID, Biometric
Disable USB:
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Security Prioritization
Current Accounting Threats
Reality: YOU are responsible!
Firm Security: IT Responsibilities
Security Solutions/Recommendations
Password Wallets
Multi-Factor Authentication
Employee Education
Updated IT Policies-Remote work/BYOD/Cell plans
Security Education
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Security Prioritization
Current Accounting Threats
Reality: YOU are responsible!
Firm Security: IT Responsibilities
Security Solutions/Recommendations
Password Wallets
Multi-Factor Authentication
Employee Education
Updated IT Policies
Security Education
Current Treat Awareness/Testing
KnowBe4
PhishMe>Cofense
Wombat Security>Proofpoint
Phishing:*Organized crime responsible for 89% of phishing schemes*70%-90% of attacks “unique” to that company
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Security Prioritization
Current Accounting Threats
Reality: YOU are responsible!
Firm Security: IT Responsibilities
Security Solutions/Recommendations
Password Wallets
Multi-Factor Authentication
Employee Education
Proactive Security Program
Internal IT Staff Training
Third Party Integrators/Security Specialists
Cloud Solution Providers
19 Security Steps to Consider:
https://info.rightnetworks.com/cpa-cybersecurity-checklist-ty
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Disrupter Awareness
Competitive Application Influx
Accounting
Practice Management
Data Extraction-ActiveData
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Disrupter Awareness
Competitive Application Influx
Automated Data Ingestion
Tax Source Data
Audit Extraction Tools
New Audit “Suites”
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Disrupter Awareness
Competitive Application Influx
Automated Data Ingestion
Robotic Process Automation (Evolution)
Rise of the Apps (APIs) (CAAS “Tech Stack”)
Data Transfer Utilities
Machine Learning
Automation Anywhere-UIPath/BluePrism
Human Verification/Oversight
*API: Application Program Interface
Need to
know:
API*
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Disrupter Awareness
Competitive Application Influx
Automated Data Ingestion
Robotic Process Automation
AI/Cognitive Computing
Accounting Adoption
IBM Watson-H&R Block
Mindbridge
Thomson InFlo
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Disrupter Awareness
Competitive Application Influx
Automated Data Ingestion
Robotic Process Automation
AI/Cognitive Computing
Blockchain and the “Future of the Audit”
Distributed Ledgers
Financial Sector Support
Accounting Application Support
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Disrupter Awareness
Competitive Application Influx
Automated Data Ingestion
Big Data Analytics-Predictive
Robotic Process Automation
AI/Cognitive Computing
Blockchain and the “Future of the Audit”
Distributed Ledgers
Financial Sector Support
Accounting Application Support
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THANK YOU!Right Networks helps my clients connect their accounting platform to other applications that will
help them with important functions of their business.
Presented by Roman H. Kepczyk, CPA.CITP, PAFM
Director of Firm Technology Strategy