Barbara Kroll, UK Managing Director of Twinfield questions, how is the steady migration from on-premise accounting software to online accounting affecting the relationship between businesses and their accountants?
Thereâs no doubt that online accounting is quickly becoming prevalent in the UK, not least because it allows easier any-time access, a reduction in admin processes and lower start-up costs.
So, how should accounting practices respond to this new business landscape?Â What impact will it have on the way they run their own practices and the way they interact with their customers?
The advantages of online accounting are clear.Â Firstly, for the end user it offers simplicity and ease of use, combined with 24/7 access, reduced IT and admin, genuine scalability and low start-up costs.Â What is good for your clients, of course, is ultimately good for you, but the steady drift to online accounting is not without its trials.
Online accounting has the ability to simplify and automate accounting functions, turning a service into something that may feel more like a commodity from the clientâs point of view.Â However, just as traditional, face to face banking is being challenged by online banking, online accounting has the potential to de-personalise accounting services.
Philip Woodgate, partner at Goodman Jones quickly identified the need to switch to an online accounting system, as he commented: âThe market has changed in recent years. Accountancy firms today need to be able to deliver more service for less. With growing pressure on price, we need to ensure that Goodman Jones continues to operate very efficiently and retains a strong team of specialists who can deliver high-level business advice to our clients.Â The Twinfield online accounting system was the answer to many of the issues that we faced. We have a number of international clients and remote staff in the UK and Ireland. We need to be able to connect our people and our clients anytime, anywhere. Thatâs not possible with traditional accounting systems.â
One of the main benefits of online accounting is that practices can embed themselves into the online accounting system, becoming the public face of that system.Â Clients can therefore log into the online system via their accountantâs own website.Â Monthly fees for the software can be incorporated into a single, inclusive charge for accounting services.Â By tying the technology and service elements together in this way, clients wonât be forced to treat the two as commodities.
Additionally, the opportunity to work collaboratively should be taken advantage of.Â This benefit arises quite simply from the fact that when you and your clients use an online accounting system itâs as if youâre sitting side by side, looking at the figures together.Â When either of you enters new information into the system, itâs immediately updated for all users.
In contrast, traditional systems tend to keep accountants and their clients at a distance.Â Usually when clients supply source documents or send in files to their accountant to process, however, the two may not discuss the results until much later.
Collaborative working which is made possible through the use of online accounting systems, has three main benefits forÂ practices.
1) Keeping ahead of the UK market
Collaboration has the potential to set you apart from the crowd and gives you a unique selling point.
Clients and accountants who work collaboratively have the sense of working as a team.
2) Anytime, anywhere decisions
By giving all users shared access to accounting data which is updated in real-time, online accounting systems improve financial insight allowing companies to have instance visibility of business changes to enhance and improve company performance.
Collaborative working, based on real-time financial data, allows you the opportunity to offer advice anytime and anywhere.
3) Increased value
Working in parallel with your clients allows you to make better decisions, more quickly and gives the opportunity to sell added-value services such as business advice and tax planning.
Â Case study
Based in Liverpoolâs vibrant commercial heart, BWMacfarlane LLP is one of the leading, independent chartered accountancy practices in the area and a Top 100 firm, with seven partners and consultants and almost 50 staff.Â This progressive practice recently took a strategic decision to implement an online accounting system, as Lesley Malkin, audit partner at BWMacfarlane explained: âAbout five years ago we discussed the idea of online accounting with existing and potential clients but although there were a few flickers of interest there wasnât sufficient demand.Â Perhaps we were slightly ahead of the curve.Â Fast forward to 2012 and things are very different.Â Weâve now started using Twinfield online accounting and weâre getting a completely different response.Â All sorts of clients, who we might not have thought would be interested, are expressing an interest, so weâre really glad that weâre launching the service now, ahead of many of our competitors.Â I think part of the reason is that people are much more relaxed about storing data on the Cloud.Â Theyâve got used to online banking and e-filing for HMRC and buying a wide range of products and services online, so itâs something theyâre more comfortable with.Â Itâs a very significant shift in opinion compared to even a couple of years ago.”Â
“With online accounting itâs no longer an all or nothing approach â âHereâs some accounting software for you to do your books with.Â Weâll pop in once a quarter to see how youâre getting on.âÂ Itâs now far more flexible and much more collaborative.Â So clients might start off doing small amounts of the bookkeeping themselves, then decide they could do a bit more, taking it on in increments.Â For some clients, this might mean that our involvement in bookkeeping and basic compliance accounting will diminish over time.Â We then have the option of providing other services to them, besides tax planning and business consultancy, for example expanding the strategic advice and support they might want in the current economic climate and helping them to get a wider perspective on where theyâre going.Â We think that, in the long run, the Twinfield online accounting system will give us and our clients more flexibility.Â If a client only wants a compliance service, thatâs fine, but the new, collaborative model of working opens up more opportunities.Â Whatâs most important in all of this is what works for the client.Â Collaborative working is about developing the relationship with our clients, being part of their team rather than just the person they bring their financial records to once a year.Â Collaboration means helping our clients understand the options that are available to them, plan for the future and achieve their goals.â