The CPA Firm Management Association* recently conducted its first comprehensive technology survey tailored specifically to member firms with the goal of identifying the applications, products and processes utilized by peers. The survey was conducted in January 2016, with 140 members participating, 90% of which had between 11 and 149 personnel and almost half being multi-office. Survey results have been broken into the five following technology components: Tax, Audit & Accounting, Administrative, Workstations, and Infrastructure. This first blog entry in the series addresses the findings of the tax related questions.
Kepczyk’s View: It has been a successful tax season for tax vendors as they did not have to make significant changes to their applications or infrastructure. CCH and Thomson continue to be the chosen vendors for most medium and larger firms. The transition to adopting paperless bookmarking and digital workflows continues to improve firm productivity as well as the transition to secure email and portals.
Tax Applications: This survey was combined with the previous SaaS/Cloud survey with the specific intent of identifying which applications are moving to the cloud as there have long been tax, document management portal and research tools available. Below we summarize the tax applications utilized with CPAFMA peer firms.
- Individual/1040 Production: CCH was the dominant tool used by respondents with 81 firms selecting it (including 20 in the cloud). This was followed by 24 firms using Thomson’s UltraTax (of which 8 were in the cloud) and their cloud-based GoTax RS (3 firms). Nine member firms utilized Lacerte with one being cloud-hosted, which it could not be determined if this was a private cloud or Intuit’s Tax Online, which utilizes the Lacerte tax engine.
- Business/Other Returns: Not surprisingly CCH was dominant in this space with 82 firms (21 Cloud/Axcess) followed by Thomson Reuters UltraTax with 24 firms (of which seven were in the cloud). Six member firms selected Lacerte and three utilized Thomson’s GoTax RS in the cloud.
- Tax Bookmarking: With the preponderance of firms selecting CCH for tax production it was no surprise the CCH FxScan was the most dominant bookmarking tool (55 firms), followed by Thomson Reuters’ Source Document Scanning being utilized in eight peers. Three other tools utilized were SurePrep (6 firms), Tic Tie & Calculate (3), and Gruntworx (2).
- Tax Scanning to OCR: The majority of firms utilizing bookmarking were also using automatic input into the tax return, which was led by 46 CCH firms using AutoFlow. This was followed by seven firms that outsourced to SurePrep, and five to Thomson’s GFR/SDS Products.
- Dedicated Workflow: While many firms traditionally utilized Practice Management Projects to track tax workflow, there has been a trend towards dedicated tools. The top three products that peer firms have transitioned to were XCM (23 firms), Thomson FirmFlow (22) and CCH Workstream (9), which is an area we see a strong trend towards firms adopting in the next few years.
- Tax Research/Forms: Thomson’s RIA Checkpoint was the dominant Research tool utilized by 79 peer firms, followed by 49 firms using CCH Intelliconnect, and 32 using BNA. With only 109 firms responding to this question, the numbers point to many firms having duplicate products, which should be evaluated to eliminate redundancy. For accessing tax forms, 55 respondents utilized CCH while 35 utilized RIA, and 24 had BNA’s SuperForm product.
- Scanner Technology: Fujitsu was the vendor of choice for 57% of respondents for their production scanners followed by 28% of peers selecting Canon. The survey found that 75% of respondents (84 firms) had implemented centralized scanning and 74 of these firms estimated they scanned 70% or more of all documents in administration. 69 member firms had also implemented distributed/shared scanners and 62 had rolled out some individual scanners, but less than half of these firms (27 firms) estimated that 50% or more of the scanning was done on these units.
- Document Management: DM products were utilized by 97 firms with on-premise tools being more prevalent. CCH Document led the charts with 25 firms followed by five firms using Thomson File Cabinet and a variety of other local products: iChannel (3 firms), CCH Engagement (3), CaseWare (2), Lacerte DMS (2), eFileCabinet (2), and Laserfiche (2). For Cloud based products, Thomson’s GoFileRoom led with 20 firms, followed by Acct1st utilized by three CPAFMA peers.
- Portal/Secure Delivery Solutions: The top three portal solutions listed by respondents were CCH (39), Thomson (17) and iChannel (3), which we honestly expected to be higher if not for the number of firms using secured email tools. ShareFile garnered the top spot for delivery of secure email with 47 firms using it followed by LeapFile (5 firms) and CPA Safe Send (3 firms).
*The CPA Firm Management Association (CPAFMA.com formerly known as the Association for Accounting Administration) is comprised of over 1,000 members of CPA firms with a focus on improving the management and production capabilities of today’s accounting firm.
About the Author
CPA Consultants Alliance member Roman H. Kepczyk, CPA.CITP is the Director of Consulting for Xcentric, LLC and works exclusively with accounting firms to implement today’s leading best practices and technologies incorporating Lean Six Sigma methodologies to optimize firm production workflows. Roman is also the author of “Quantum of Paperless: A Partner’s Guide to Accounting Firm Optimization” which includes the results of the 2015 CPAFMA Paperless Benchmark Survey.