5 problems solved by online accounting firms
An emerging trend in the accounting services industries is the concept of an online accounting firm. Also known as virtual accounting firms, these are accounting services providers that provide their services through the cloud. If you’re considering switching to or using an online accounting firm, this article is for you. In this article, we’re going to talk about five problems with traditional accounting firms and how our online model has solved them for our clients.
We’re going to start by laying out some of the main problems with traditional accounting firms. If you’ve worked with one before, these will all sound familiar. If you’re in the process of selecting your first accounting firm, then trust me; these are not things you want to experience.
Here are the five main problems with traditional accounting firms
- Paper, paper, and more paper;
- The “black box”
- Manually intensive
- Getting ghosted
Now, let’s get started.
1. Paper, paper, and more paper
One thing you’ll always hear from accountants at traditional accounting firms is “just give me all of your receipts and your bank statements.” So, you’ll spend the entire year loading up a shoebox with receipts, hoping your dog doesn’t eat them. Then you drive to your accountant’s office. You drop off the receipts. You then go back and pick them up later. Then you tuck them away somewhere, never to be seen again.
The cornerstone of online accounting firms is going completely paperless. Important documents are shared with your accountants using document repositories such as Receipt Bank or Hubdoc. In less time than it would take you to walk put a document in a filing cabinet, these tools allow you to upload all your receipts, bills, and other documents to the cloud in seconds.
Paper is implicitly inefficient. Imagine you get audited and need to find one invoice out of 1000 supplier invoices. Paper means picking through, one-by-one, until you find the one you need. In the paperless realm, you just lookup the invoice in your accounting system, and the supporting document is attached to the transaction. Easy.
2. The “black box”
Accountants are very mysterious. They take your receipts, disappear into their office, and then 2 or 3 months later you have a financial statement. You’ll be given some idea of how it all goes together, but ultimately, you’re just hoping that they know what they’re doing. We call this the “black box” problem; there is little to no transparency around how the accountant comes up with the number. Then, 2 or 3 years later, you find out there’s an error and you’re amending several years of tax returns.
Our online accounting firm is enabled by cloud accounting software. From virtually anywhere that you have an internet connection, you’ll be able to login and see real-time financial data about your business with complete transparency. No more waiting for your accountant to put together a financial statement at the end of the year. You’ll have up-to-date information about how your business is performing. Better information means better decisions.
3. Manually intensive
It can be manually intensive to work with traditional accounting firms. Some will be bold enough to tell you to enter receipts into a spreadsheet yourself. Others will have you drive to downtown Halifax in rush-hour traffic to drop off a box. An hour here. Thirty minutes there. It all adds up and it ends up costing you time.
Being paperless already saves you a ton of time. On top of that, our firm regularly works with clients to help them capitalize on automating both accounting and operational processes. By helping automate processes, we save our clients time, enabling them to focus on their business.
Here are just a few of the areas save our clients time through automation:
- Expense entry
- Payroll processing and remittances
- Sales taxes
- Financial reporting; and,
- Inventory Management
No more entering things into spreadsheets. No more driving across town.
Traditional firms carry a lot of overhead in the form of staffing and real estate. They can also be inefficient in how they operate, using very “traditional” methods of accounting. Ultimately, these costs need to be recovered through increased client fees.
Our clients aren’t the only ones who benefit from online accounting services; we do, too. The automation, paperless recordkeeping, and remote access to accounts and records allows us to deliver our services to clients much more efficiently than our traditional counterparts with a reduced overhead. We pass these efficiencies on to our clients in the form of reduced fees without a reduction in service.
5. Getting ghosted
One of the biggest complaints about accountants is getting ghosted. Your accountant isn’t answering emails. Hasn’t returned your calls. Won’t tell you when they’re filing your taxes. Is outright MIA.
When we ask our clients what they like the most about working with us, the answer is often our responsiveness. The efficiency of online accounting firms in processing day-to-day accounting means we aren’t bogged down by data-entry or an influx of work around tax time. This allows us to focus on our clients and be accessible when they need us. Our clients benefit from 24/7 access to a Canadian CPA when they need one.
If you’ve worked with a traditional accounting firm before, then you’ve probably experienced heaps of paper, limited access to information, manually intensive processes, inflated fees, and had your accountant ghost you. If you’re picking an accountant for the first time then trust us – these are not things you want to experience. Check out our services or contact us and see how we can make your accounting a breeze.