Understanding evolving technology and its profitability impact on your firm

In a recent fireside chat with Alan Fitzgerald, a leading tech agnostic consultant at Practice Connections Advisory, and Damien Greathead, the leader of the advisor group at Intuit QuickBooks, sat down to discuss what the rapid advancement of technology within the accounting profession means in practice.

FitzGerald has spent over 24 years in tax and accounting software and helps firms assess what technologies are suitable for them. He is recognized as one of the most experienced consultants in Australia for practice management accounting technology and his knowledge and understanding of what it takes to be effective in the advisor digital space.

FitzGerald explains that many firms are assessing whether the technology they are using is adequate for their needs going forward. He noted that many smaller firms are still using desktop platforms and need to transition to cloud-based solutions for greater flexibility and efficiency.

The power of a cloud solution

FitzGerald explains that the beginning of a new financial year is an opportunity for firms to sit back and understand what technologies they should be looking at compared to what they are currently using. Many smaller firms are still using desktop platforms, and the transition to the cloud is a topic for many practice owners.

Some firms are hesitant to move to cloud-based solutions, FitzGerald explained that it's often a mindset shift that needs to occur, as many firms believe that if something works, there's no need to fix it. However, he noted that the business environment has changed significantly over the past few years, and cloud-based solutions offer more outstanding capabilities and efficiencies.

Accounting practice management such as QuickBooks Online Accountant enables firms to effectively manage their practice as well as their clients. Through time-saving integration between QuickBooks Online, QuickBooks Online Accountant and QuickBooks Tax, firms are able to complete the books and prepare and lodge BAS and tax returns for their clients as well as efficiently track the practice’s work, pay their team, record time and bill their clients.

The software helps users manage their books and also automates month-end reviews for their clients. The in-built performance centre also gives accountants and bookkeepers an accurate, up-to-date understanding of how their clients’ operations are tracked, all at the touch of a button.

The impact on profitability

The conversation also took a deep dive into the cost implications of remaining on legacy or desktop solutions. FitzGerald highlighted some of the misconceptions Advisors still have about the actual cost of their technology, and urged them to make the effort to gain a proper understanding of the ongoing expenses of desktop solutions versus the costs of cloud-based solutions. Many of the costs associated with running an accounting firm are hidden costs, such as server maintenance and software updates. These costs disappear when moving to a cloud-based solution, and firms have greater flexibility in choosing the software tools that best suit their needs.

You can build what you want, and it can scale with you. "I recently had a conversation with a client, a suburban firm with 20 users. Their desktop Practice Management system was going to cost them $84,000 over 3 years. I asked the managing partner what parts of the program they rely on, and his response told me he wasn't getting $84,000 worth of value using those 4 features. I suggested he build his tech stack focusing on what they needed, which will come out at a fraction of the costs.

In contrast to traditional desktop solutions, where businesses have a provider-prescribed set of tools, cloud providers offer better security settings and give businesses the flexibility to choose software tools that best suit their needs. Greathead emphasized the importance of taking the time to understand what the truly necessary features and functions required in a practice management suite before committing to one, as many businesses end up paying for features they do not use.

The role of artificial intelligence

The conversation also touched on the growing role of artificial intelligence (AI) in the accounting software space. FitzGerald emphasized that AI is not the end of accountants but rather a tool to enhance the relationship between the advisor and the client. AI can be used to help take care of communications, standardize workflow checklists, and triage email inboxes. However, FitzGerald also cautioned that AI only knows what it knows based on historical information, and practitioners need to be cognizant of that.

Greathead highlights how QuickBooks Online Accountant uses AI to automate various accounting tasks, such as categorizing transactions, reconciling accounts, and generating financial reports. The AI technology in QuickBooks Online Accountant can also help identify potential errors or discrepancies in financial data, allowing accountants to quickly address and correct them. This is a game-changer for helping accountants and bookkeepers save time and increase efficiency by automating repetitive tasks, allowing them to focus on more strategic and value-added activities for their clients. The role of AI in the QuickBooks suite is to streamline accounting processes, improve accuracy, and enhance productivity for accounting professionals.

They also touched on how firms are leveraging AI in key fundamentals of their workflow. It is being used strategically to create job descriptions, email templates, social media posts, blog posts, and more. Mailchimp is a prime example of automating your firm and marketing efforts through an AI-powered tool. Connecting QuickBooks and Mailchimp can help you streamline your marketing efforts, improve your client relationships, and drive growth for your accounting firm. By syncing your customer and sales data from QuickBooks to Mailchimp, you can create targeted email campaigns that are tailored to your client's needs and preferences. This can help you build stronger relationships with your clients, increase engagement, and ultimately drive more sales.

The nature of AI is constantly evolving of AI and the need for practitioners to experiment and try new technologies is growing. It’s in a firm's best interest to stay up-to-date with the latest technology trends and leverage AI to enhance their advisory relationships with clients.

Next steps

Having all your clients’ accounting needs taken care of in one place is key to optimising your time and helping your clients run their businesses better. It might be time to make assess your technology and the way it can help your business thrive.

FitzGerald and Greathead encourage practitioners to attend events and community forums, to stay up-to-date on the latest technology advancements and to consider the QuickBooks suite and the practice management tools in QuickBooks Online Accountant.

The QuickBooks suite automates a wide range of different accounting and bookkeeping tasks. It makes everything from preparing clients’ BAS to year-end tax filing streamlined and systematic. It’s a one-stop shop that supports accountants and bookkeepers to manage their practice, run their clients’ books and meet their compliance obligations.

Contact us today to find out more about how Intuit QuickBooks can streamline your workflows so you have more time to spend working on what’s important to you.