Creating a digital environment: a paperless office is a more efficient way to provide enhanced client service.

• Author: Simms, Dan

All CPA firms have one thing in common. Outside of personnel, the firms most important asset is its clients. How clients are served depends on how we as professionals interact with them on a daily basis. The quality of this interaction is further driven by how information and data are obtained, manipulated, accessed, shared, and stored. Data in digital format is the safest, most efficient means of data handling.

Over the past few years, innovative firms of all sizes have proven that it is possible to implement a completely digital (paperless) environment that can exist and function effectively. The goal for all CPA firms should be to manage data in a more efficient manner within a digital environment. To develop such an environment, firms have different technology issues they need to resolve.

Technology is advancing at a rapid pace, and CPA firms must stay current in order to remain competitive. The AICPA has determined staying current to be so important that it has developed the AICPA Competency Model, which addresses the technology skills that will be expected of CPAs in the future.

Most people, however, are comfortable doing what they know how to do, adhering to a philosophy of If it's not broken, don't fix it! Although the process and systems, may not be fundamentally broken, by not reviewing them, a firm probably is not maximizing its profits. In general, people are frightened by change and are afraid to lose what they know. To move forward, however, they must manage this fear, and the only way to manage fear is through education. Learning new skills takes time, patience, and an open mind. We should always be trying to determine if there is a better way to do business. Working in a digital environment is a better way to do business.

There are also other reasons for CPA firms to implement a digital environment. A firm may need to use these arguments to persuade its leadership that implementing a digital environment is necessary in today's market.

Gaining competitive advantage

One sure fire way to gain a competitive advantage is to promote technology change, process reengineering, and education. The current trend in the market is for more fixed fee engagements. Firms that can operate more efficiently will see higher profits. Firms that have implemented digital environments are seeing increased profits and increased efficiency. In the second year of implementation, on average, engagement hours should be reduced by about 25% for accounting engagements and 50% for tax engagements. These reductions should be all the incentive necessary for a firm to make the leap.

Meeting Client Expectations

CPAs are the most trusted advisor to their clients. Clients expect them to keep up to date on the latest technology trends and advancements. A CPA firm is a business just like its clients. Improvements and implementation of advanced technology within a CPA firm can also help its clients.

I hate to hear CPA firm partners say I don't need to improve the technology at my...