A CPA Trendlines Flash Briefing
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What to Start Doing Today to Be Fully Prepared for Next Tax Season… and Beyond.
Hosted by Seth Fineberg, AccountantsForward
With Guests Chad Davis, Kellie Parks, and Kenji Kuramoto
GET SETH FINEBERG’s analysis and commentary here
TOP TAKEAWAYS
- Artificial intelligence.
- Work smarter, not harder.
- Managing tech expenses.
- The fast track to rapid adoption.
- Choosing the right tech for your firm’s needs today and tomorrow.
PANEL OF EXPERTS
Chad Davis, CPA, CMA, Owner, LiveCA
Chad Davis is a CPA and a co-founder of LiveCA LLP in Canada. He co-hosted the AutomationTown podcast and has a weekly newsletter sharing solutions to common tech issues for accountants. He’s also in his sixth year traveling full-time with his family in their RV across Canada and the USA.
Kellie Parks, CPB, Cloud Accounting Process and Automation Builder, Calmwaters
Parks is a Certified Professional Bookkeeper and Founder of Calmwaters Cloud Accounting. She is passionate about all things online accounting and apps that create a robust cloud accounting ecosystem. Parks is an innovator, adopting cloud financial technology for her own business in 2009, and in 2012, as soon as it came to Canada, Parks adopted QBO and has not looked back. She is QBO Advanced Pro Certified, Freshbooks Certified, Dext Certified, WagePoint Certified, QBTime Certified, a Hubdoc Advanced Partner, Plooto Partner, Ignition Partner, 17Hats Partner, Karbon Partner, PandaDoc Partner, Zoom Partner, Reply Partner, and an Acuity Partner.
Kenji Kuramoto, CEO, Founder, Acuity
Kuramoto is the Founder and CEO of Acuity, which builds and maintains financial functions for innovative entrepreneurs. Through Acuity, he’s provided thousands of companies with a full range of financial solutions, from high-level strategic financial counsel through its fractional CFO practice, all the way to virtualized bookkeeping and tax services. Prior to Acuity, Kuramoto was the CFO of an Inc. 5000 tech company and worked in the assurance practice at Arthur Andersen.
MORE SETH FINEBERG: Remembering John Stokdyk | Who’s in Control? You? Or Your Clients? | Time Management Rule #1 for Accountants | Plan to Go ‘Live’ Post Tax Season | Why VC Is a Bigger Threat Than AI | What Does Taking Control of Your Firm Mean? | Accountants Need Each Other More Than Ever | Marchternity: Just Say ‘No’ | Some Thoughts on In-Person Events | So You Think You Know Accountants? | What Bogs Down Accountants
MORE PODCASTS and VIDEOS: Peter Margaritis: The Power Skills Every Accountant Needs | Joe Montgomery: Find the Sweet Spot of the Right Clients, Right Services and Right Prices | Marie Green: Your Bad Apples Are Ruining You | Megan Genest Tarnow: Hire for Curiosity Rather Than Compliance | Clayton Oates: One Way to Keep Clients for Life | Randy Crabtree: Follow These Three Rules to Keep Employees Happy | Erik Solbakken: Yes, You Can Work Less and Make More | Donny Shimamoto: Future Firm Growth Requires a Mindshift |
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TRANSCRIPT (only lightly edited)
Rick: Hi, my name is Rick Telberg for CPA Trendlines with a distinguished panel of guests today. Our moderator will be Seth Fineberg. Some of our best friends are here today: Kenji Kuramoto, Kellie Parks, and Chad David. With that, I will turn it over to Seth.
Seth: Kenji Kuramoto, Kellie Parks, Chad Davis, to me are just three of the individuals who I’ve gotten to know personally, but also who, again, are running their own practices. Really have really jumped in with tech and really kind of taken it by the throat and going, “All right, I’m going to figure this out. I know that my clients really need me to be on top of this. I’m going to run my practice in such a way that is considered by many of the accounting masses tech-forward.” Don’t feel too intimidated. Everyone’s at their own level of the adoption curve and this can’t be overstated too much.
I’ve been overseeing the profession now for over 20 years, both as Technology Editor of Accounting Today and also as the Editor of Accounting Web. In that time, I continued to talk to firms pretty regularly. The rate of change, the pace of change really has never been– and maybe this is redundant, but it’s never been more intense than it has now. Not just that, we’ve never had the sheer amount of technological decisions, the impact that technology has had on all of your practices and all the practices out there today has never been what it is before.
When I started it was still all very much predominantly desktop-based, and even that you had a finite amount of actual software to work on, and platforms, and systems. You knew who it was, you knew your practice management, you had a few choices there. Your accounting work that you did, the payroll work that you did, the external work that you did, and things to run your practice were pretty finite. Then along came the cloud and apps, and that really blew the doors open. Now we’re talking about the new level of automation with AI and it has everyone in a tizzy, except the folks in this room. We’re going to get to all of that. We want this to be an actual discussion.
We’re definitely not going to get to everything that we need to in our hour of power here, but I really thank you all for joining us, for taking time out of your day. As mentioned in the promotions, this is not for CPE, it is a non-sponsored event. We did that with purpose because in my view– again, no disrespect to a lot of the vendors who are out there who are doing things, were sponsoring a lot of these chats, who are doing things for CPE it’s great. I want them to be communicating with you all in a way that is beneficial and meaningful to you.
This was a conscious choice by myself and Rick to have a chat like this that has no agenda behind it other than getting you the information we feel that you need. Starting the kinds of discussions around technology adoption that you need for your firm and for your work and therefore non-influence in any way. We can talk about a vendor or two if we need to. Nobody’s here necessarily in the room. Let’s jump into it. Again, any questions, please throw them into the chat here. We will get to them. We hope to get to them, but I’ve got my own list of questions here. Real quick introductions guys and then let’s get into it. Kenji, why don’t you kick it off?
Kenji: Sure. Thanks-
Seth: Quick snapshot of you for those who don’t know you, and then Kellie, and then Chad.
Kenji: Sounds good. Seth, Rick, thanks for having us. Kenji, I am with the firm Acuity. We are essentially an outsourced accounting firm based in the US headquartered in Atlanta, Georgia. Our service lines are basically predominantly CAS, outsource CFO, outsource controller, and kind of a virtual bookkeeping-off solution along with a small tax practice. We typically focus in target working with very, very high-growth entrepreneurs.
Those tend to be SaaS-based technology companies, e-commerce, crypto, some creative services, things like that. That gives you an idea about the service lines, who we work with typically as clients. Then we have a team of about 150 employees. About 100 of them are in the US. The rest are international into the Philippines or Caribbean. That’ll give you a little bit of a sense of how we approach all this tech from a a firm of our size and who we’re serving.
Seth: Excellent. Thanks, Kellie. Go.
Kellie: Okay. I’m Kellie Parks of Calmwaters Cloud Accounting. I am a micro firm up here in Canada. I generally deal with multi-entity corporations. I am taking on now– I’m taking a break until the spring, and then I will be taking on the accounting firm’s books. Currently, I do hot masses for some of the accounting firms. I do more project work than MRR, so the hot mess. I have a couple accounting firms. I’m doing their books and I love that. I’ve decided that’s my new niche come the spring. That’s kind of fun. I’m gearing up for that. I love tech. I consider myself tech-forward but human-centric. There we go. That’s me.
Seth: Excellent.
Kellie: Oh, I deal with US markets too. I’m Canadian-based, but I’m also a US ProAdvisor.
Seth: Yes, yes you are. Thank you, Kellie. Chad, take it away buddy.
Chad David: I’m not a US ProAdvisor, but I am Canadian.
Seth: No, you’re not.
Chad: We’ve grown predominantly as a CPA firm in Canada from just my business partner and I up to over 110 people, and then back down to about 60 or 70. That’s a really interesting story, sometime we can talk about. Intentionally my role has been around the technology adoption both of our team throughout that process and our customers. For every new customer that’s ever come on board with us, I’ve been involved in creating new financial tech stacks for them. That really led to a really interesting introduction to a dev team that we created inside of our accounting firm.
So working through automations, coding stuff for clients, and then we ripped that out of the firm. There’s all kinds of trying things coming back to basics with a real focus on what the customer needs. I think I’m a little bit addicted to the technology side of things, but like Kellie said, the eyes on the prize with what customers and your team really needs to move forward in their career and in their business. That’s been where I’ve been spending most of my time. Also six months in Canada, six months in the US out of the year.
Seth: Driving across the continent in your RV. I hope it’s holding up well, Chad.
Chad: It’s holding up.
Seth: I’m glad.
Kellie: I modeled myself after Chad that I want to spend six months not in Canada either, so I followed him to the States. [laughter]
Chad: It’s warmer in the US and in the winter.
Seth: Very cool.
Chad: Thanks for having us.
Seth: Thanks for being here. We’re already getting some questions coming in. I am going to get to them. I just wanted to kick off with you guys just saying, look, when it comes to making these technology decisions, you guys talked to other practitioners as well. What’s the most common misstep that firms are taking or making these days in regards to their technology decisions. What comes up the most where they’re just, yes, hey probably not doing that right. Kellie, why don’t you start off?
Kellie: Oh, sometimes I see that people go after what the shiniest thing is, what their friends are doing.
Seth: The new and shiny. Yes.
Kellie: What has the big names out there that possibly maybe solving a problem that they don’t even have, or that they’re not going to interact with properly? They’re looking to technology that isn’t solving their problem. They’re going shiny. Your friends running around and trying new things, and you’re just spinning your wheels if you don’t have the same problems that they do. I think that then you’re bringing in too much tech.
Part of it is you can just adopt tech that you absolutely don’t need and that maybe isn’t even fun that could actually take you out of your workflow as well. It could break processes that are having well. I think being more measured in what you’re going to bring on that suits you, and making sure not just the app has the features but that the UX and the UI makes you want to interact with it as well. I think so– that’s what I got.
Seth: Kenji, what do you hearing? Similar to Kellie, people calling from the new and shiny, maybe you even guilty of that yourself early on.
Kenji: Sure.
Seth: Not throwing you under the bus or anything. [laughs].
Kenji: I’ve been very guilty of chasing the new and shiny or next squirrel or whatever it is. I think that there’s probably some of us who are in that spot like, “Oh, what’s the newest, craziest thing?” I would bet the three of us panelists are probably like that. As you hear more about us we’re technology forward. I also see a lot of accountants who have not taken that first step, are a little bit stuck because I think there’s needs to be an acknowledgment of the ecosystem it’s freaking huge these days. It’s blown up. It’s massive.
When you look at how many tech solutions are I think folks are feeling a little flatfooted. I think it’s all hard to get started because you’re going– there’s so many choices out there. I see that being a little bit paralyzed of like I’m not even exactly sure which way to go here. How do I attack this massive ecosystem, this huge market? I think that’s a place where, and I think very, very, very understandably people get stuck there. I get it like you’re just like, “Where do I even start? How do I boil the ocean or eat this elephant here? I think that’s a tough spot to be in.
Seth: Not that we’re boiling any elephants or drinking oceans, people. [laughs]
Kenji: No. No those things. Let’s hope we get those … the right way and make sure we don’t get in trouble. I think that’s a spot where folks are watching and not taking enough action. We’ll probably talk about that in a little bit about steps and things people can take. I think you’re a little flat footed. That’s the one I’m concerned about with some practitioners and firm owners they’re just a little stuck but I get why they’re.
Seth: Chad, this is something you want to weigh in on and just in terms of some of the common missteps. We’re getting some good questions in I want to get to them.
Chad: True. I think common missteps for me relate back to– you can think about starting like Kenji talked about. It’s hard sometimes to start, you’re not sure where to go. A lot of firms have started, they’ve implemented something, and then they might get stuck. Did they choose the right one? Should I switch practice management firms? Should I switch my email provider? Should I switch this? What I’m seeing is that a lot of the maybe the firm’s that I’m running around with or speak to they make those decisions in smaller silos.
Maybe the ownership and maybe the management level, but it’s not as deep as it could be. Really identifying the issues that pop up that will give you more benefits to actually switching or to maybe leaning into more training. To make the product actually work better is somewhat of a common theme. I think that there’s a lot of options that you can do to mitigate this, and that’s why I’ve been on a big kick for continual training of your team and getting-
Seth: No matter what size firm you are you can–
Chad: That’s right and the place look different at different levels.
Seth: Oh, sure.
Chad: I just think I see too many people not investing in that feedback loop that’s standardized and objective versus the touchy-feely subjective type of feedback that we typically get from a lot of people. Organizing it, keeping track of it, and then acting on it. I don’t see a lot of people doing that.
Seth: A great question came in about average spending, and I’m going to throw that over to Rick in a minute. In terms of just getting started, this is the whole point. It’s like take that step. Great. You got your accounting platform. I know that we’re going to get to some actual tech stack discussions, but it does bear some focus on the getting started the overall process and selection of tech.
You got your QBO, you got your zero, you got your Excel, your tax software. For firms that aren’t using, necessarily anything much beyond those, how do they get started? For this, I haven’t heard discussions or some of our good buddy Jason Stats that actually brought up the idea of like, yes, you probably pretty much need to get started with a practice management system and that’s your base. For some of us out there and if that makes sense, Kellie go.
Seth: I just wanted to bring it up because you brought up a very good point, and I saw a very good discussion and participate in that discussion about that very point. I was like, well, there’s some firms that don’t necessarily want to start with a practice management system. They don’t feel like they’re at that level. They have their core tech that they work on, but it’s that even worth discussing if you’re a six-person firm. I don’t know.
Kellie: Oh, yes.
Seth: This is what we want to talk about here.
Kenji: I’ll admit, I’m in Stats corner on this one because when you think about workflow and your own internal processes or processes for the Canadians. When we think about all of us have those in our firm, we have challenges there, it’s going to dominate the way in which we work. I think that’s where there’s low-hanging fruit, typically. We think about using technology to help assist. Startups, we work with a lot of technology startups, and you often hear that some of the best startups were built to solve a problem that the founders had, something very near and personal. When you’re always solving a problem that you have, and trust me if we go and ask our team they will tell you about all the problems we’ve got in workflow.
Seth: Got to communicate.
K: I think it’s a good point by, Stats. I think it’s fairly obvious. It’s a very good starting point. It may not be that for everybody, but it’s got to be at least in some of the first few starting points of what workflow system is going to help facilitate the work you do inside your firm and help your team members. I think that’s pretty high up there, in my opinion.
Seth: Good way to get started, I think. Yes.
Chad: You mentioned something about cost. I went to our income statement and we’re currently paying $350 Canadian, so $280, $290, whatever US per person right now at the level we’re at now. I think the price goes down the more people you have typically but that’s where we’re at. It wasn’t always like that. I looked back five years and it was maybe half that.
Seth: Would you say it’s a percentage of your revenue, Chad, or you’re like, hey, we budget?
Chad: No, it’s seats. It’s butts in seats in terms of pricing like that. Again, it’s different for every company, but I do like– we’re talking about that first version of starting out. It’s how can I organize myself such that I don’t operate in a silo?
Seth: Yes.
Chad: It doesn’t matter if you’re two people. It’s still a silo if you both don’t share your information. Sharing–
Seth: Oh, 100% it could feel like you’re at a much larger firm.
Chad: For me personally, it’s how do I share my emails in a way that allow us to comment and to work on those things without a minimal interruption.
Seth: Yes, communication. Very key. On the cost thing again, and then we got wonderful questions flowing in. Please keep them coming. People, we’re going to try to get to them all. Rick, this might be for you because CPATrendlines they keep quite a number of statistics and do a lot of research out there. It was a really great question about just approximately the average percentage of revenue spending on tech for CPA firm. Again you could break it down by size, but it’s a pretty, pretty broad question. Do you have something that you can weigh in on that, Mr. Telberg?
Rick: Sure. I’m thinking through the accounting firm operations and technology survey now. So far we can tell you that only about 11 or 12% of the firms report having any budget set aside for that wall. Let me see if I can come up with-
Seth: There’s some stats here that Rick threw in the chat to everyone, so everyone take a look at that so we can move on but really, really good stuff. About an accounting firm thinking strategically when change in new tech is happening so fast. This is a point I wanted to make but also roll into the fact that coupled with the challenge that firms really need to cut through a lot of hype around being modern and being more tech-forward. A lot of that just coming from a variety of entities, some of it from the vendor community, some of it from industry organizations that are out there with a certain number of initials attached to them. How do you cut through, how do you get strategic, Kenji?
Kenji: I think it starts with, yes, there’s always going to be a lot of buzzwords. It’s putting some meaning behind those. What does that mean strategically for you? If you want to cut to the hype of what it means being modern or more forward-
Seth: There’s a lot of it.
Kenji: -there’s a lot of it out there. We always talk about it’s always panels, and at every convention or conference we go to. It’s oftentimes that gets held up or idolized like, wow, look at this tech-forward or modern firm. I think that the really behind that strategically is, are we being thoughtful about how we’re solving clear problems? I think the easiest place to go is to our team and to our clients.
What does it mean to help serve them better? That could mean using some technology that improves communication. We all know that all of us that’s the dominant issue most of us have with our clients is there’s bad communication. Does something improve the communication flow, the workflow there? Does something help reduce the amount of time that team members have to spend on manual processes?
I like to think of it in terms of what tech can we use to attract more clients, attract more team members who go, “Gosh, I want to work at a firm that’s made an investment in tools.” Or even a client who says, “Oh, there’s finally an accountant out there who’s working on some of the same platforms I am.” I think that helps drive that forward and cut through the language, and I think it helps retention as well too. Like Chad mentioned, when you invest in training in particular but good tools for team members, they understand that.
There is a million places for accountants today to go work. It’s a great time to be an accountant. They have their pick of a litter of where they want to work, they want to open up their own shop. I tend to think about it in terms of what’s going to go out attract great people to our firm, what’s going to retain them. You better believe you got to put in place some good technology and some good training around them. That’s meaningful to them. That helps their day-to-day lives.
Seth: If you’re thinking even about transition or succession. If you’re going to sell your firm, what do you look like? Not just your client list, but do you even have some of the basic things that you need to even– this is why this is pressure to look modern and be modern. It’s like, “Well, yes, I would like to maybe think about selling my firm in the next five or 10 years. What do I look like? Am I using the best stuff?”
Chad: I got something for that, Seth.
Seth: Yes, please.
Chad: I was chatting to a new firm owner yesterday afternoon. His name is Jeff. He has a firm that’s specifically selling a product now. That product is its core. That’s how they’re marketing, that’s how they’re attracting customers like Kenji said. The backend tech is to be desired. He’s putting a lot of effort into how do I present this, how do I gather the information, how do I make it as seamless as possible for my team. That’s a great example of what Kenji said because he’s cutting through the hype for the things that are strategic for him and his firm. Not trying to play into the nice new, cool, shiny thing.
I love that approach and that’s how we’ve looked at where we put our effort. Because admittedly we’re still using tech that we used 10 years ago because it works. There’s new shinier things out there, but it’s not as important as the other things we’re working on like getting better data of our customers and using that to do stuff. I think there’s a prioritization skillset that firm owners have to have in order to keep people happy and their bottom line a little bit happy too.
Seth: Kellie, I know you’re along there. Again, there’s two-fold discussion going on here. There is your process of selection and trying to cut through a lot of the clutter. Then there’s also you have to be mindful about your present and your future when it comes to not only maybe selling your firm but also staffing up. You want to attract the right people. You want to look like the firm that, “Yes, they’re using things that I could get my head around and that really shows that they’re thinking of their clients, about efficiency.” Sorry, Kel, go.
Kellie: I switched practice management apps a couple of years ago. It is only myself and one team member. It’s just the two of us. I could have made a unilateral decision so it was time to switch. The type of work that I was doing, it was time to move on from what I was. There was no way that I wasn’t going to make that decision with Marissa. I had a problem that needed to be solved. What I was using was fine, but it wasn’t working as well as I wanted to communicate with my clients more than anything.
Then the second step was I did not make that leap without her wanting to be a part of the technology that I was looking at, so we had shortlisted it. One, it solved a problem, two involved a team member. Then the third thing is, I also don’t think we need to go for the cheapest options. Sometimes a cheaper option is going to cost you more in the long run. It should be part of your decision matrix, but it shouldn’t be necessarily number one in that decision matrix.
Seth: Again, this flows well into the tech stack discussion. We have all heard that you need the right tech stack. You’ve got people out there preaching about– I’m going to name-drop again. I hope you don’t mind with someone like Dawn Brolin who’s really, really bangs on about you have to get the right stack and she’s got her starting lineup. That might not be the best in terms of vendor mix or product mix for everyone. With any tech discussion the issue of tech stack rises. Eyes off and glaze over, what should really be the base? What’s essential for firms today meaning the firms that are basically like y’all just doing tax, doing bookkeeping work, and does time and billing come into that as well? What’s the tech stack, Chad?
Chad: You’re asking the Canadian tax person who has no relevance to the Americans here.
Seth: Just in general, in general, you’re thinking about tech stack. We’re being country neutral.
Chad: There’s the big five. You’ve got your practice management, your tax, the actual accounting software you’re using, the document management stuff, and then communication. If you think about those there are a lot of options.
Seth: Do time and billing not–?
Chad: Yes. For us, our time and billing isn’t integrated with our tax software. It’s separate because we use it in so many different areas of the firm. I’ve found it more valuable to do that because we’re not billing based on time and materials. We’re billing off of a budgeted fixed cost every month that’s the same and it had no correlation. As long as we got our metrics that were important to us I’m super happy. That’s why I never really go into, “Hey, here’s the practice management system for you. Here’s the tax system for you.”
In Canada, what was really important for us was to use an online tax system, and the only one that had been around for a long time was CCH iFirm, so that’s what we use for all of our– that’s our tax returns. Since day one on the document management we’ve been using Dropbox. Why do we not use anything else? We tried. It just failed. Different people didn’t want to use things. For decades Dropbox has been around and it’s been fine. Literally, like knock on wood, not one issue in like a decade, and tomorrow it’s going to all go to crap. It’s what works. To the point earlier, why switch something that isn’t causing any problems?
We use Karbon for all of our project management work and our email communications. That has single-handedly been the biggest upgrade in our ability to grow from the communication perspective because now we can talk about emails, and assign them to jobs, and have full visibility. To me, that unlocked more potential wins that anything else we have ever done tech-wise. Then practice management, document management, and communication we always been on Google. We just integrate that with everything that we’re using, so that works for the Karbon, that works with all of our Google Docs stuff.
Again, it works for us. It doesn’t mean it’s the best or it’s going to work, but when we doubled in all the big automation stuff, Google’s pretty forefront there back a few years ago. Now Microsoft’s winning there, but we never had any issues. I’m happy with the stack where it is now. Will we make any changes? Probably not for a little while until we went into problems.
Seth: Yes, and then you’ve got your core accounting. I know you do a fair amount of compliance work, and then everything else that supports that. Kellie, anything to add in terms of tech stack essentials? Is it as important enough to people get a little stressed about like, “Do I have the right mix?” I don’t know.
Kellie: I want to say two things. Chad, pretty much covered them except possibly one exception that I would add, and that I think a good solid payment platform. If you want to do AP for your clients which has great– the amount of money you can make on the actual lift is amazing as long as 100% the only thing you sell is the outcome of how seamless it’s going to be.
Don’t sell how little time is going to take. Tell them how easy, and so adding a payment processing platform I think is the only thing that I would add to Chad. Yes, practice– oh, Chad didn’t mention it, I know he’s big on it though, is an integrator to tie it all together. That would be something like Zapier or Make, I think is something. I think in the online scheduler and a solid form builder, forms do so much work for me. I think a solid form builder, but now I’m really getting into the weeds of what the little things are.
Seth: All right. Having an integrator like a Zapier or Make as your API choice.
Kellie: I’m not even a big user. As Chad and I were talking about yesterday, I am not the world’s biggest Zapier person.
Kellie: You know what? The little things that Zapier does for me all day long is great. Whether it’s back-office work or there’s a lot of things that Zapier can do within– I know everybody wants to do all the air table stuff and do all of the magic and all of this, but there’s a lot of direct integrations from– especially if you have multi-entity clients, that Zapier can take the information from one file and feed it into another.
I think an integrator app– and don’t be afraid of them. That’s a big part of the tech, is being afraid of it, but even Zapier, a lot of this stuff is prebuilt. Put in one app and ask it about the other one and away you go. That was a really long version of saying everything Chad said, plus an integrator, and possibly adding accounts payable your client products.
Seth: An AP solution. There’s a lot out there, folks. Kenji, anything to add into the tech stack? The basic tech stack discussion, plenty of firms out there just looking at what they have. They’re like, “I don’t know. I do some stuff in Excel.” This thing isn’t talking to this thing, I don’t know if I’m doing this right. Where do I start and to get it right?
Kenji: I think they nailed it. Yes, they nailed it. For the base level things, I think Chad and Kellie nailed it. I would say that think something that may help as you’re scaling. Your practice and firm is either look for this in a workflow solution, you may have to look elsewhere, is be thinking about how you can look at your clients holistically, or whether by practice, someplace that you can do overall firm management or your team can do firm management of clients.
Karbon. Karbon can do that. There’s other workflow tools that can help you look at it in aggregate, not just to sign out tasks to individual engagements, but can aggregate that. You can look for trends. That’s important. It’s going to become more important with scale. Sometimes that may have to move over into a more of a dedicated CRM system. We got to a point we had to do that to where we have a separate system that we really need to have to help look at all the clients holistically and do assignments and things there.
As you’re thinking about your scale and grow, all these tools change a bit, but that almost managerial view over the client base becomes a bit more important as you get in the 10, 20, 30 people on your team and more and more clients. That becomes more part of the base stack for sure.
Seth: What about things like client portals, share file, things like this for file sharing works, that come into play?
Kenji: I think it does, but I think there’s discreet options like Chad mentioned, a Dropbox. I think many are starting to embed that within their tools within the workflow. There’s some options there. It’s not too difficult. It’ll depend on what works best for your team and your clients to find some document management out there. Again, some are just already embedded in workflow tools.
Some you might need to be discreet, have some different controls over them, whether they’re Google Drive or Dropbox or Box or something along those lines. That would need to be important, especially as a– I guess it became more important for us as we added tax. Tax is our newest practice line we added a few years ago. That became a little more important for us having that. Historically as a CAs firm, it wasn’t as important for us to do lots and lots of file sharing. That’s just our experience.
Kellie: Can I throw something in about the document management?
Seth: Please. Yes, I was going to add on that, but yes.
Kellie: The client portal thing. The client portal has become a big word, but really what it is is managing communications and documents with your clients. The one thing that people lose sight of, they get all excited about these portals and they have not analyzed what the actual workflow that’s working perhaps looks like or where it’s broken and where that portal could fit in. I see people integrate a portal, if you will, that takes them out of their process.
I’ll give you a super quick example. I want everything of my client’s bookkeeping documentation to wind up indexed. There’s a million reasons why it winds up indexed, I know some of it’s a Canadian reason. It needs to wind up in one place. I was looking at some things that we’re actually going to take the documents and put them somewhere else that would then kill that process of what we were doing over there. You need to be careful that you’re not disrupting a process that’s working when it comes to adding in text.
Seth: Excellent, excellent point. Non-technical, very practical, and even to Chad’s point too, just make sure it’s working and don’t mess with things that are working. Product specific– Yes.
Kellie: I think Kenji and Chad would both say this because they both do tax and I do not, but my hot mess projects look like tax in terms of collecting documents.
Seth: I love that that’s your in– Is it your in-house label for– [laughs]
Kellie: Yes. You guys let me know, there’s almost a completely– you’re going to have a different process on this side for the tax clients than you’re going to have over here for the CAs work. You may need two processes. Go ahead, Chad. Chad’s going to totally tell me no.
Chad: No. I’m reflecting back on this section and there was a couple specifics, but I left out the most important thing because you just said something that sparked it. It’s like, don’t fix if it’s not broken-ish or something like that. Sometimes you don’t know when something’s broken and you need someone to tell you. From the beginning we had used password managers just because it was convenient.
Seth: Sure.
Chad: Then I started meeting people who didn’t have password managers, and the conversations that came from that were astounding. Once someone who is using one talks to someone who isn’t, the next thing they’re doing the next day is putting one in place. It’s still a very, very important base tech stack to throw in something that’s being used really now that people are liking or that’s really safe-ish. That’s changing over the years. A couple that people are really loving these times, KeePass, Bitwarden, 1Password, they’re staying away from LastPass a little bit more because of all the hacks. Then there’s a couple more out there too. Give them a try. I would probably make that just as important as your practice management system.
Seth: Interesting.
Kellie: That’s such a good point, Chad. That is an amazing point.
Seth: We’re all connected. We’re in a connected world. We got to keep on top of our passwords.
Chad: Sorry. And to that point, there has to be accountability for it. Right now we have one person who looks at our watch tower inside of 1Password. If there’s any duplicate passwords, they’re in it every single day, making sure that there’s no duplicates used anywhere. The amount of times that people try to use the same password in different apps is astonishing too. Accountability with process is like happiness.
Seth: Wonderful. Few questions have popped up specifically talking about specific products. We got to bring them up. People are curious about certain brand names out there, SharePoint for document and file sharing with clients. Excuse me. Anyone use it? Anyone can weigh in on it?
Kenji: We did historically, but it was quite a while ago. I’d say before we saw the Google suite really take off. It’s probably been over a decade since we used Microsoft. I came out of a Microsoft background and a Microsoft tech company. We leaned heavily on Microsoft tools and we just moved away. It was a little more our finding again and take this for what it is. In fact, there’s a little more complicated at that point to implement. That could have changed. We used to use it now where we are not using that for any kind of document movement.
Kellie: Can I make a point about asking specifically about an app like that? Again, everybody’s experience is going to be so different. How’s it going to impact your process and how does it fit in with the rest of your apps? If you’re already a Microsoft house, then that’s probably an option that keeps it in a suite together too, and also, how do you feel about using it? You take somebody like me, Microsoft makes me feel like a ding-dong. I can barely even log into Microsoft. Everything about it,-
Seth: Thank you for your honesty.
Kellie: -it totally challenges me, but I totally understand Google. For me, my initial reaction is, “Ugh, SharePoint.”
Seth: Yes.
Kellie: Maybe it fits in with how your employees or– Do we say employees? Do we have to say team? How your team thinks and how … your… I attract clients by magic because I guess I’m throwing it out to the universe. When you’re looking at an app that is a specific app rather than a vertical of apps, it’s going to be about where does it fit in with my other stack, how do I feel when I’m using it, and what is it going to do to the processes that I’ve got going on.
Chad: [crosstalk] Horace asked a question about multiples. I think the way that we approach that is, one, do we want to engage in an activity where we have to choose, do we want that customer? If the answer’s yes and we know that there’s going to be extra work, what infrastructure are we prepared to put through to make that relationship work?
Seth: Yes.
Chad: We always just said, “No, no, no, sorry, we’re not going to work on Microsoft stuff.”
Seth: Taking a hard line.
Chad: It didn’t last very long. Now we have Microsoft accounts for every user here, so if they need to access some things with a Microsoft account, they can.
Seth: No, good point. If somebody’s going to be on some stack, it’s like a Microsoft, not a Google.
Chad: We don’t use it per se for things, but we use it for access, which is nice. Just my own personal view here is that technology moves in ebbs and flows. We are in an ebb and flow of we’re not really sure how Google’s reacting to the new AI work that’s coming out. We all love it, but Microsoft has made a lot of promises and have a lot of great things backing what they’re building right now. I’m open to the idea that if something is incredibly better, you take a thorough look at how this impacts your team and what the impact is. To say that we’ll never use Microsoft is a bad statement, and to say we’ll always watch and decide based on pros and cons is an absolute accuracy.
Seth: Getting back to just the idea, this does tie into, of course, your overall processes and selection. When we were preparing for this chat, Kellie had brought up the idea of just like, “Look, it’s not going to just be one thing for everyone. You have to be willing to try, and in some cases, it should be fun. You should enjoy what you’re trying.” Kellie, I don’t want to take your words, but–
Kellie: No, but fun is totally underrated. Some of it goes back to UX/UI, but fun is underrated. I have lots of fun little things that maybe I don’t need. They solve problems, but maybe I don’t need them. My practice management app is Financial Sense. I have been bugging them that I want confetti or gold stars when a project closes. Yesterday we got confetti, and it’s so silly and it’s so fun. Some of these little interactions. We also have emojis in there. If Marissa puts in a note, I don’t have to pack back out a note. I can actually just like it or do these things.
Seth: Why the heck not?
Kellie: It’s interactive. I think that some of those things are highly underrated in terms of usability.
Seth: Yes. Vendors definitely need to be listening to that. Before we get into our discussion about AI, and I know everyone’s champing at the bit there, final notes on the tech stack discussion. Anything to particularly avoid or just absolutely should not do when you’re talking about the stack, even for small firms? Obviously, we’ve been talking about a lot of shoulds, and some product names, and some APIs, things like that.
Anything to avoid when it’s coming to password protection? By the way, I see a lot of your questions coming through here. They’re really great. Thank you so much. This is being recorded, and I’m hoping that the folks after this chat can hopefully get back to you, or they can feel free to get back to you individually on some of your questions. Final notes on the tech stack, things to avoid when you’re–
Chad: I’ll keep it short. If I had to do it over again, I wouldn’t sell services. I didn’t have a very thought-through support structure for it. When we started selling automation services, we had a team of five, and I thought that was enough to be able to sell and to support just for 10 or 15 clients just to test it out. It turned out that that is not true. There are just some services that they’re just so different than what you’re used to, that the cost of supporting them, not only is it unknown, but it can be unlimited based on things that you may not structure in your contract properly.
I wouldn’t get right into things like automation services or going all in on automation or AI if you don’t have a great base. Keep that in mind, that while the shiny stuff is really nice, it does take a really strong foundation to make it work.
Seth: Absolutely. Kenji, anything else to add there? I also have a follow-up in there, particularly about firm management apps.
Kenji: Things that I will avoid like the plague when looking at tech stack is confidence or just lack of support in their own support function. If there’s not strong support there, and what I mean by this is not just say we have an email address or a help number to call in. If we’re going to move, and this is something we do very thoughtfully, beyond calling you a vendor– I don’t like being called a vendor myself either, it’s a one-way relationship.
If you’re going to be a tech stack partner, and our tech stack partners are listed on our firm website, we invest in you heavily, you have got to demonstrate to us that you have a strong support function that is unique and discrete for our firm. Now, that may sound a little arrogant. That may sound like, well, that’s asking a lot. We know that we’re playing the role of tier-one support. We’re helping probably sell the product for them at times. The least they can do is show that when we’re going to show us as a true tech stack partner that you’re going to partner with us and a client expects that. Something’s going to go wrong, something always goes wrong on engagements.
You know how frustrating it is for a client to take a look at like, well, if we end up finger pointing, well, they screwed up this, we did that, it’s a horrible situation. They need to see that like, okay, there was a problem, but Acuity and Xero or Bill or whoever it is are actually working together in a unique way that they wouldn’t have been able to get that level of support otherwise. I’m very, very cautious. Table stakes are, of course, it’s got to solve the problem we need to solve. The technology does. Of course, it’s got to be financially feasible. Once those table stakes are done, it almost should be table stakes, I need to see a very strong support mechanism because that’s just too much for us [crosstalk]-
Seth: Got to demand it.
Kenji: -clients and our time and our energy on that. That’s a big one for me.
Seth: You have to demand it. If you’re entering into that vendor service provider accounting firm relationship, which we could have a whole separate discussion about how strained it is at the moment and has been building over time, you have to step up and say, “I expect this level of support. I expect this kind of relationship from you to happen.” Also, there was a technical question that got thrown out there, and then we’re going to get into some AI.
I think it’s relevant in the text that we’re all talking about building. What about when you’re switching? We didn’t really get into that too much, when you’re moving from one thing to another, say, switching from a firm management app, retaining the history. How do you do that with the least amount of disruption because we’re all talking about maybe moving to something better?
Chad: The only– five seconds, planning. Planning. When we move to Karbon, we put one person’s 0.5 of their FTE for eight months onto Karbon. They planned everything. Then when it rolled out, it worked. I won’t say that that’s what it is today because it could be more, it could be less, but for us, we were willing to put that investment in. It was like our director of ops at the time. It was really important.
Kenji: I’ll piggyback on Chad’s real quick. I think it’s really important. In our experience, it’s by far been the most difficult, challenging changes we’ve had to make across the tech stack. We’ve done it four times, I don’t know why in the world. It just gives me heartburn thinking about when we’ve done it and Chad nailed it, it’s planning. The thing I’d add to that is-
Kenji: The return on that investment takes longer than I expected. I think that’s something to go into expecting. It’s going to take a while. You’re going to have to manage people’s emotions through it because plan, plan, plan for sure, but it’s not something that’s usually very well received by the team, even if they understand that it’s going to help in the long term. It’s going to interrupt their workflow in the short term.
Seth: Totally agree. AI in the accounting space, folks. Again, we could have a whole separate hour dedicated to that, and we still wouldn’t really get to it because there’s a lot of emotions when we bring up AI in accounting. A few weeks back, we were just down at a pretty sizable conference, scaling the lights. This was a question that was on the majority of the folks’ minds and mouths, talking about it. There is definitely a lot of concern because there’s a lot that’s unknown. It’s really hard to– In the few minutes that we have, I just want to touch on some of these things and get these discussions going.
By the way, that’s what this chat is about, really is about planting some of these seeds, having you go back to your practice, go back to your firms and continue to talk about these things, continue to ask Kellie, Chad, and Kenji about them. How to really crystal ball the whole thing. Cloud went through it, too, we remember. Just that how it’s going to take this away. It’s going to change this. Where do you see AI working best in accounting and where, if anywhere, are there or should there be concerns?
Chad: I think auditing is going to look a lot different and there’s going to be a lot easier steps for our team members, a lot less hours spent doing certain things. Three is, as hyped up and as weird as this is, I’m doing another presentation on chatbots this Thursday with NYOS group, which is fun. I did a lot of research into this. Chatbots per client is a really easy thing to do right now. Just seeing what that looks like and then talking to their data and reducing the amount of time it takes for us to answer questions and monitor what they’re asking and get alerted to cool stuff, I’m really excited about that. Four, ChatGPT has changed my entire life in terms of how I work every day. It’s up. It’s [crosstalk].
Seth: That’s a bold statement, Chad. [laughs]
Chad: It’s fundamentally changed. I’m building things I’ve never built before. I built my own version of Live.
Seth: You’re having fun. You’re having fun.
Chad: Crazy. I’m having a lot of fun. Then fifth is I’m excited for what I don’t know. This is stuff we didn’t know about in November that was possible, it’s only July. What else is around the corner that could be coming up that is just so mind-blowing? Lots of concerns. I’ll let Kenji and Kellie take over.
Seth: We definitely got to get to those. One of those being, I’m sure, do not put financials in ChatGPT. I think we’re very clear on that. You don’t know. Kellie, go.
Kellie: Actually, I want to come back to Chad. You said you built your own Live and then I didn’t hear what the sent–
Chad: Well, you know how LiveFlow connects into QuickBooks and it brings it all into Google Sheet?
Seth: Ah.
Chad: I asked ChatGPT to walk me through how to do that for Xero. Now I have my own apps working right inside of Google Sheets that connect into Xero that give me all the stuff in.
Seth: Nice.
Chad: I’m limited to 25 orgs right now with the stuff, but it took me four hours to build an MVP to connect and switch in between the apps. It’s a skill I did not possess in November and now I know how to do it.
Seth: Amazing.
Kellie: It’s fun. Awesome. This is why you are the man, Chad.
Seth: Should be fun.
Kellie: [crosstalk] that stuff. Awesome. That’s all I wanted to know. Go, Kenji.
Seth: [laughs] Kenji.
Kenji: Again, all I want to do is just keep giving Chad the big Amen on that one. The last point I think is really, really important and doesn’t get talked about enough, and that is almost that, again, being interested on how things change. I think that’s especially for the firm owners or if you’re a leader of the technology practice in your firm, or even you don’t have to be, but showing your peers and the people you work with a sense of curiosity, of interest. I can’t tell you how important that posture, that culture has been for us of saying, this is signaling to the team that we’re not going to be fearful. We’re going to be curious. We don’t know what’s going to happen. Okay, that’s a little bit strange. I don’t know what’s going to happen, but we’re going to be curious about that.
I’ll tell you a little bit of a different way that I’m looking at AI right now, and this is because I’m not even close to Chad’s technical chops, and I think most of us as accountants aren’t. When I think of like, “Oh my gosh, I’m building things in technical,” yikes, that seems really hard. I love the point about using ChatGPT is a little bit of a co-pilot. I’m going to have my little system I’m going to ask things to and get that dialogue.
Seth: Exactly. Yes.
Kenji: The other thing, what I’ve noticed is, I think for a while I was feeling some pressure in our firm and… like to think of a modern firm of like, what are we building? What are we building in tech? What are we building? I was feeling left behind, like, oh man, the world’s going on behind me. I’ve changed my thinking a little bit just based on some observations.
The biggest observation I’ve had is fortunate that we get to work with a lot of the great tech companies in our space. I get a little bit of some insider baseball on some of that stuff and I’m really becoming impressed. I think actually most firms are not going to have to worry about building their own. I think it’s going to be reassessing our tech partners to see who is using AI well, who’s using it responsibly, who’s using it well.
Seth: That’s going to be a bellwether. Yes.
Kenji: I feel like there’s going to be a big shift again in the landscape by which of our tech partners out there figures out how to use AI the best, because those products are going to look really strong. We’re starting to see some of those already emerge. I think that it’ll be a whole new way we have to look at our ecosystem, but I don’t think I feel as nervous about, “What am I supposed to be building at Acuity?” I’m like, “Oh, I probably need to be spending more time looking at how our partners are using it.” That’s a little bit of my shift in thinking.
Seth: Guys we have about a minute or so left, so we’re going to enter the final thoughts part of our getting real chat. Thank you all for getting real with us. I hope you got even a crumb of something that you can take back, that you can continue to have these discussions amongst your staff, amongst the people in your firm, the people in your professional life that you know. Everyone just give their your final thoughts on tech adoption in the accounting space. Kellie, and then we’ll go around.
Kellie: Actually, I’ve enjoyed just echoing my buddies here.
Seth: Sometimes that’s what it is. We get a good group of people together, we get good heads together, we think alike.
Kellie: Right, and we’re sober. I don’t always see Kenji when we’re sober.
Kenji: No. Next time [crosstalk]
Seth: Now, I’m guilty of the shame. Those who know me.
Kellie: I just want to echo Kenji’s word. I said be careful if it doesn’t solve a problem. I think curiosity was a great word, so that would be a great walkaway–
Seth: Go forth and be curious.
Kellie: Great walkaway word.
Seth: Awesome. Chad, final thoughts?
Chad: It’s easy. It’s just be out there, make friends, talk to people smarter than you. Talk to people that could learn from you. That’s how I’ve spent the last 10 years, and it’s been a huge unlock to just put yourself out there and say hi to somebody. Accountants are really nice people and it’s a great community to be a part of.
Seth: You might get to some chats going from this crew that have joined us here today. Kenji?
Kenji: Yes, I would just say again, it’s a big, big ecosystem. There’s lots of changes and so I think when approaching it, go in either very specifically trying to solve a problem that your team has or clients have, just listen to them will give you good things, “Hey, can you help us solve this?” and focus there or go in with that sense of curiosity and just explore. Sometimes when I’ve made the mistake when I mix the two and I’m at a conference, next thing I know, I’m like, I didn’t come away from the conference with what I needed and I was just kind of–
Just be a little bit of discipline upfront with what you’re trying to accomplish and switch back and forth because it’s a big universe out there, but it is pretty fun and exciting when you get into it. Again, ask for help. Reach out to any one of us. We’d be happy to share, and point you in the right direction if we can.
Seth: Have a purpose, don’t be afraid, be curious, ask questions, and see what’s out there. Don’t be afraid to try some things. Thank you all for spending some of your morning and afternoon with us today. Rick Telberg, final words before we sign off. I believe this recording is going to be made available to everybody.
