With April 18 in the past, tax practices should start assessing their performance.
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With that in mind, here are 10 areas on which to grade a tax practice (and its staff, tax software providers and clients).
1. Overall profitability
Besides projected-versus-actual billing, it’s also worth looking at expected-versus-actual hours and other staffing metrics. If it’s possible, firms may also want to drill down on individual accounts or types of accounts to see how profitable they actually are.
2. The practice’s tax software
Many tax software providers start offering tests and demos of new packages and features during the summer, and it’s helpful to have a good idea of what worked and what didn’t before kicking tires on new packages.
3. The tax software provider
How responsive was the vendor to technical issues and questions? How reliable were their support teams? Did they have any unexpected service outages? How good were they at communicating about outages or other disruptions, and how quickly did they resolve them?
4. The practice’s workflow
If the biggest roadblocks don’t spring from the firm’s processes or technology, they may come down to individual performance, which is the next area to examine.
5. Staff performance (and partners, too)
However, it’s important to make sure that everyone gets assessed, as partners and managers can cause just as much trouble during tax season as anyone else.
6. Staffing levels
Some questions to consider: Was staffing demand consistent throughout the season, or did it vary? Is the firm’s ratio of temporary to permanent tax help appropriate? What does the growing use of extensions mean for post-season staffing?
7. Client profitability
8. Client personality
Identifying and getting rid of them will make next tax season much better for all concerned.
9. Client satisfaction
That’s purely passive, though: The best way to find out what you’re doing right and wrong with clients is to ask them, preferably with a formal survey, either by e-mail or by phone.