Tax Season Checklist


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Labor Day just marked summer’s end, yet many accountants still have their minds on the beach, or pretty much anything but tax season. But some professionals out there whose job it is to study best practices point out that starting to plan for crunch time now—before becoming overwhelmed with stacks of returns—can help firms boost revenues, profits and staff morale.

In an August entry on his blog,, Rick Telberg released results from last year’s “Busy Season Stress-O-Meter” survey of roughly 2,300 practitioners, which found that firms that identify themselves as Leaders by any measure comparable to other firms (revenue growth, staff morale, client satisfaction) excel at four skills: planning and managing workload, embracing new technologies, minimizing partner conflicts and people problems and communicating with and properly preparing clients.

Leaders are more likely to report a “significant increase” in revenue by 9 to 25 percent compared to Laggards who are behind the curve.

Partner Insights

Conversely, Laggards are more likely than Leaders to report poor planning or scheduling by 15 to 32 percent and technology or software glitches by 27 to 34 percent, according to Telberg, who also serves as president and CEO of Bay Street Group, which provides consultancy services to accounting and financial services firms.

Planning encompasses a variety of areas, including training, software and systems reviews, moving toward a paperless office, determining how much temporary help will be needed and whether to outsource any work to staff within the country or offshore.

This feature serves as a guide for some things firms can start doing now to increase efficiency once things start shifting into higher gear and the time for planning seems to disappear.

Preparing With Less Paper

Firms can claim they are paperless til the cows come home, but even the vendors that provide document management systems admit that it’s more like “less paper” than no paper at all.

They also acknowledge that making the move can be difficult and that there are small steps firms can take and experiment with in the fall instead of trying to take giant leaps during busy season.

“There’s a critical mass of competition going digital,” Telberg says. “If you’re not doing it this year, it’s too late.”

How can firms get started?

First, understand how the process of handing the pieces of paper from one person to the next works in the firm’s current environment, determine whether that system is right for the firm and whether it can convert into a paperless system.

“It’s almost a personal decision. There’s no single right answer,” Telberg says. “Before going digital, they have to understand how their office works because they do things by habit.”

Look to the tax software already being used and see what document management capabilities it offers, Telberg suggests.

September is an ideal time to start evaluating new systems and strategies, he says. Make purchasing decisions in October, install in November and run through drills in December.

Telberg’s survey found that 24 percent of practitioners reporting “getting up to date on new technology or software processes” as their most troublesome issue.

“Given the new (political) administration, the 2009 season could bring a lot of late-breaking tax law changes,” Telberg says. “You don’t want to be implementing new systems while dealing with new tax laws.”

Accountants also need to consider hardware and software to gain efficiencies. These include things like scanners and dual or triple monitors, which employees often use as a substitute for the paper they are used to holding, keeping source documents open on one monitor and the tax software open on another.

Practitioners also are eyeing client portals, which allow them to share and store source documents with clients on the Web. Currently, Thomson and CCH are the only tax software vendors offering them, but Intuit and others say they are considering it for the future. Several third parties, such as the FamilyOfficeNetwork and Ceridian offer low-cost alternatives and some firms have developed their own.

Intuit held a user conference this summer and found many people wanted to go paperless but didn’t know where to start.

“It sounds convoluted and expensive,” says Jorge Olavarrieta, group product manager for Intuit’s Lacerte product. “Start simple. Start implementing scanners. A scanner is nothing more than a copier that instead of producing a paper copy produces an electronic copy.”

Begin by scanning things staff typically would have copied—such as source documents, and tax returns. Then set up a filing system either through the tax software vendor or a third party; some scanners even include basic electronic filing systems, Olavarrieta notes.

Then comes the question of when to scan — at the beginning or the end of the process — and whether to scan in returns from previous years or just start fresh.

Telberg believes it is OK to just start scanning now, arguing that eventually the old files will become obsolete anyway.

“Don’t overcomplicate things,” Olavarrieta says. “Or you could go back a step. Don’t even buy a scanner but stop producing the paper. Save to PDF.”

Extensions are a perfect opportunity to run experiments, Telberg suggests. Try scanning in advance and see if there are obvious improvements that allow firms to prepare returns from digital source documents instead of paper.

Metrics for success could be time saved or the convenience of having those documents live on a computer instead of a filing cabinet, says Telberg.

When determining metrics, “let your judgment guide your decisions,” Olavarrieta says. “If you think it’s easier, that tells you you’re saving time. When it’s an opportunity to improve a process, try something different.”

Improvements could also be made when it comes to training employees on both technology and processes.

“Once an accountant compiles a list of the areas employees need help, quite often they find people within the office that could provide the training,” Olavarrieta says.

Debriefing the staff after tax season and trying to solicit feedback on problems they ran into months ago isn’t as efficient as creating a simple system to document problems as they occur. The system can even live in Excel.

“Prioritize what will give the biggest bang for the buck. Engage employees in prioritizing it,” he says. “List a manageable set of changes and try to run a couple experiments and potential solutions.”

Temporary Help

Training early in the process is also good advice when it comes to hiring temporary help, says Jon Zion, president of eastern U.S. operations for Robert Half International.

“The temporary workforce is a significant investment in terms of their contribution. Orientation shouldn’t just be a one-day event,” Zion says. “Have ongoing interaction and make sure they are comfortable with their job, have the appropriate resources and their projects are challenging enough. Always be in touch the first week or two, then every couple of weeks.”

Approaching temps in a strategic way by treating them like permanent employees will allow firms to invite them back in following years and avoid having to train new people. Call them during the year for a variety of projects, send correspondence about the company, Zion says.

While firms can request temporary staff return this year, temps don’t have to go anywhere they don’t want to, Zion says. And the good ones will get gobbled up fast.

He suggests firms start planning how to ramp up around October or November. Looking back over the past three to four years and taking growth into consideration should provide a fairly accurate conclusion on how many people they need, he says.

Staffing agencies aren’t the only place to find help.

Intuit in June unveiled the Accountant Work Exchange for accountants and QuickBooks ProAdvisors to find some extra assistance.

The online exchange is currently available for free. Professionals seeking extra projects create a profile listing their experience and qualifications and accountants seeking to hire those contractors can search prospects based on experience with different products or geographic location.

Jay Malik, an enrolled agent, Certified QuickBooks ProAdvisor and owner of Easton, Pa.-based Uncle Sam Tax & Accounting Corp., beta tested the exchange last season and plans to use it even more in the future.

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