White Paper: Firms Harnessing the Power of Cloud Accounting
Newly published cloud accounting white paper …
… from the AICPA and derived from recent research conducted by Silicon Valley tech consultant, author and managing director of consulting firm TCG Advisors, Geoffrey Moore, describes the impact that cloud accounting is having on client accounting services for companies of all sizes.*
Moore interviewed dozens of accounting leaders and technologists and discovered that work involving client accounting outsource – has rapidly become a cloud-accelerated field of growth for accounting firms. His findings are assembled into a new AICPA research report, titled “Accounting Services: Harness the Power of the Cloud.”
Moore lays out three mega-shifts that are fueling innovation in the CPA and financial professions: transitioning from paper to digital, Internet-based solutions; practices moving from a physical to a more virtual presence; and from being a “generalist” practice to specialization in particular industry niches.
“Our fundamental premise is that, in the past, major barriers to productivity made (client) accounting services a low-margin activity that was unattractive to pursue,” Moore wrote. “In today’s online digital era, we believe these barriers can be removed, and the practice can be re-engineered into cloud accounting, a high growth, high profitability line of business.”
Moore also outlined a 3-step entry for evolving a cloud accounting services practice:
1) Move to the cloud
2) Adopt systems of engagement
3) Adapt business intelligence to manage data powerfully and present information simply for clients.
How fast should firms be moving through those stages? Moore said it’s a judgment call.
Visionary firms seek fast growth and are already tech-savvy – they’re likely to be all-in for change, he said. Pragmatists are generally satisfied with firm operations, but want to shore up under-performing areas – going to a paperless office might represent a good medium risk, medium reward step for them. Conservative firms are happy with the status quo and reasonably sure of customer loyalty. They might subcontract client accounting work to a more tech-friendly firm, and buy in to innovation later in the adoption cycle to save costs.
“The key to capitalizing on this new set of opportunities is to free up professional time to devote to such analytics, to use that time to determine the key performance indicators for your client’s business, and to work with the business intelligence software to develop simple dashboards that make performance factors readily visible,” said Moore. He added that it is up to firms to be their own judge on how fast they should be moving through the technology adoption stages.