Magazine article The CPA Journal

The CPA Journal Millennium Series: The Bridge to Success the Internet into the Next Millennium

Magazine article The CPA Journal

The CPA Journal Millennium Series: The Bridge to Success the Internet into the Next Millennium

Article excerpt

In Brief

Construction Costs Won't Be Cheap

CPAs, especially those in public practice, must face the harsh reality that the bridge to success in the next millennium is not made of bricks and motor, but of silicon. Sooner or later, computer technology and the Internet will catch up with practitioners that have avoided facing it. Some have been able to make up for technology inexperience by working harder and employing more people. The current economic boom has concealed the fact that CPAs not utilizing technology have fallen behind, in terms of efficiency and the knowledge they would have gained about technology had they only been using it.

But e-commerce and the transfer of back office functions to the Internet will, through adoption by clients and successful businesses, come to dominate the CPA's world. Those that choose to stay behind may suffer the consequences of being irrelevant.

Technology's impact on the CPA's workflow has, in many ways, been very personal. In the past, the user of the CPA's services very often did not know the extent to which technology was at work increasing efficiency for the CPA. Whether it display of financial information was initially developed on a sevencolumn pad or an electronic spreadsheet was not always discernable to the end user. And, whether a CPA kept her calendar or list of contacts in Outlook or in one of those fancy manual organizers was equally nonapparent. Nor has it been obvious exactly what role technology has played in the preparation of a tax return. Was the tax research done using the old-fashioned paper product or the online electronic version?

More noticeable is the extent of Internet use bv CPAs. If the boss or a client communicates using e-mail, the CPA had better the able to respond by e-mail. But other than that, there are many CPAs that still think of Yahoo as a chocolate-flavored drink.

Of course, there are many CPAs that have taken full advantage of technology and the Internet, moving their firms and businesses into new areas of practice and management and significantly increasing productivity. Often it is one or two sparkplugs in a firm or an organization that transform the way things are done.

For the year 2000 and beyond, however, the successful CPA will no longer he able to bluff her way through a discussion on technology. Use of the Internet, the most imp(ortant innovation since the telephone, cannot be avoided. Effective use will be made by those (TAs with a vision of what the profession can be and the creativity to deliver what the vision foretells.

I have provided a number of examples to help CPAs, understand the potential of technology-there is no better time than now to act. like an architect, I have tried to provide the blueprints, so that more people can envision the ultimate building.

The CPA in Public Practice

It is my belief that a major shift is about to occur in the way accounting firms offer services to their clients. My first example is of the client that calls and asks for a copy of a prior year's tax return or for an employer identification number. lis happens quite frequently and can be somewhat of a nuisance. But to the client, it is an important issue, and the CPA is expected to respond to this simple request immediately. Traditionally, a clerical person retrieves the file, makes a copy, and mails it to the client. Though simple, this process is time consuming and generally not profitable. What would be the high-technology solution? To retrieve a copy in a digital format and e-mail it to the client? Not a bad idea. Many CPAs and CPA firms are in a position to do just that, presumably using some form of secure transmission because of the confidential and personal nature of tax return information.

But this solution can be taken a step further. Why not give the client a password and allow its staff access to copies of tax returns, id numbers, copies of payroll tax returns, and any other information the firm stores digitally? …

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