Case studies: Client accounting services in 2018

Client accounting services have been experiencing a boom in recent years, but the service is not a new concept. Firms have been providing what was often simply called “outsourced accounting” to their clients for as long as accounting has been a profession. However, the advent of online accounting software and the development of technology that enabled outsourced accounting to evolve into what today is a much more robust offering than simple bookkeeping and data entry. The firms featured here share their experiences.


True collaboration

Firm: By the Book / The Koenig Group

Staff: Three (in the CAS department)

Product: AccountantsWorld

Commencement date: 2010

On the record: Partner Jim Sosinski, CPA

On CAS: Jim Sosinski founded his firm, By the Book, as a one-stop-shop for client accounting in 2006. Sosinski defines client accounting services as the “outsourcing of the total bookkeeping and accounting function of your business,” and he sees his firm as the “quarterback of your business’s back office.” While he started “formally” providing CAS to clients in 2006, he said that in practice, he’d been providing those services for 15 years prior.

Last year, By the Book was merged into The Koenig Group, a larger accounting firm based in Clark, N.J. Sosinski, who is now partner-in-charge of technology and implementing workflows and processes, said that this has granted him more resources, both human and financial, to serve his clients better.

Selection: By the Book made the switch to AccountantsWorld in 2010. “I was strident in looking for a solution that would really help me collaborate with clients,” Sosinski said. “When I went out looking for truly collaborative software, AccountantsWorld was it.”

Before Sosinski started his search, he sat down and wrote a wishlist of all the features he wanted in his new software. To his surprise, AccountantsWorld matched his wishlist “95 percent right out of the box.” That list included that it had to be cloud-based, offer true active collaboration, and would allow him to set controls and preferences according to each client. “Most solutions work the opposite way, where you have to make the client fit the parameters of the software,” he said.

Implementation: Sosinski described the implementation as “not that easy,” but only because the product he was migrating from didn’t make transferring data very easy. “There wasn’t a lot of data I was able to export,” he said, “but that was 2010.” Today, AccountantsWorld has a fully integrated importing system that Sosinski said he’s seen other firms use effectively to export data from another accounting software system.

Sosinski conducted the implementation himself, with instruction from AccountantsWorld. “I plan for change,” he said. “[The accounting industry] is always changing. By planning for it strategically, you can mitigate that change.”

Highlights: “With AccountantsWorld, the accountant is in control,” Sosinski said. “We control the engagement, which is what we’re trained to do — this is our profession — versus the client controlling it and inviting us in whenever they want.”

Sosinski also said that AccountantsWorld continually adds “robust tools” — electronic bill pay, the approval process, and bank feed integration are some of the tools he likes. Sosinski additionally noted the integrations with various time-and-billing software platforms, which allow his clients to enter their hours themselves versus having the firm manually do it.

“AccountantsWorld offers robust customizability to do exactly what clients need,” he explained. “We sit there and define with the client, ‘How are you doing things?’ We can identify their pain points and provide solutions that eliminate
that pain.”

Challenges: “I wouldn’t call them challenges, but as with any system, as you use it, you’ll come up with ideas of how things could run better or for new solutions,” Sosinski said. “I’m considered more of a power user to AccountantsWorld. I have direct email and phone access to key personnel there, and nine out of 10 times, my suggestions are embraced and instituted.”

Firm growth: According to Sosinski, the area in which CAS is really going to expand is analytics and, consequently, advisory. He recalled a young client of his, a dentist who just opened his own practice. While the client isn’t interested in knowing the details of the full set of services Sosinski provides, he loves getting a full data report that AccountantsWorld provides Sosinski, so he can understand a fuller picture of how his business is operating, rather than just transaction by transaction. “His generation does everything online, and on their smartphones,” Sosinski said. “They have little interest in the whole system of accounting I provide. But AccountantsWorld allows me to capture everything electronically, and the client doesn’t have to give me anything once the software is set up.”

AT-112918-CAS plans in 2019


The shift to advisory

Firm: JCCS CPAs

Staff: 120 (firmwide)

Product: QuickBooks Desktop and Online (Intuit)

On record: Client advisor II Erin Vukelich

On CAS: “Until just a few years ago, client accounting services was strictly outsourced data entry — entering checks, deposits, expenses, transfers,” Erin Vukelich of JCCS said. “There’s been a shift in the last couple of years where we’re moving away from strictly accounting and moving to more of an advisory role. When I think of CAS now, I think of not only data entry but also looking at numbers and communicating that to clients.”

Selection: Founded in 1946, JCCS has been using QuickBooks software for as long as it’s been available, Vukelich said. The firm was using QuickBooks Desktop when QuickBooks Online hit the scene, but in its first years, QBO wasn’t as full a solution as the firm needed for its clients.

However, “As years have progressed and QBO has improved, we’re seeing more clients moving to it and clients new to us were already on it,” Vukelich said. Today, JCCS is in the process of moving almost all of its clients over to QBO, except for the few clients that still need QBD-specific features such as inventory management.

Implementation: Vukelich has been with the firm for eight years, so wasn’t around when JCCS first started using QuickBooks. However, during this time of migrating over to QBO, Vukelich said the firm has been “working very closely with the Intuit support team.”

“They’ve been fantastic about helping us identify good clients that are easy switches so we can get the implementation process figured out,” Vukelich said. “This process helps us figure out what’s going to work best for our clients and the potholes to stay away from.”

Much of the migration of data has been set up to be automatic, and Intuit will send a three-person team to the firm over the course of a month to help with the process. The most time-consuming part, Vukelich noted, is training clients.

Highlights: “The ability to build in efficiencies and automation” is the top advantage Vukelich enjoys from QBO. “Reconciling books takes a shorter time than it used to. Now we can link to bank systems, point-of-sale systems, and we don’t even have to enter in sales data. It used to be much more manual.”

“What used to take 15 hours to do now takes five,” Vukelich said. “What can you do with 10 hours — go out and sell more? Spend time with your family? Or maybe the client wants to develop a new part of their business they haven’t focused on yet.”

Challenges: As noted above, training clients is JCCS’s biggest challenge. “Especially if clients have been with QBD a long time, QBO looks different,” Vukelich said. “By now we’ve developed enough of our training materials to a point where we feel comfortable talking to clients about what’s going to change.”

Firm growth: “The efficiency and automation is huge,” Vukelich said. “We can be touching 10 clients in the time we used to touch five. We’ve seen growth that way. We service more clients and at a higher value than before, when we were so focused on just getting the data in. Now we can review data to make sure it’s correct, but we can also analyze that and give back some recommendations to the client.”

Vukelich went on to add, “The partnership you create with your technology solution is incredibly important, whether you’re a sole proprietor bookkeeper or a larger firm. Our connection with Intuit has been a huge game-changer for us as far as making sure we’re implementing everything right, and the support they give us.”


Specificity of service

Firm: CliftonLarsonAllen LLP

Staff: 800 (outsourcing services department)

Product: Sage Intacct

On record: Principal Abe Mathew

On CAS: CliftonLarsonAllen is a Top 100 Firm of approximately 5,400 professionals, with an entire 1,386-person department responsible for outsourced services. Within that umbrella falls outsourced business operations services, or BizOps, that provides a range of different outsourcing services to clients, broadly including part-time, permanent resources, as well as project and consulting resources. Abe Mathew is a principal with the Sage Intacct practice of the firm, the software CLA uses for a large portion of its outsourced accounting services. According to Mathew, the broad definition of client accounting services has remained relatively consistent over the years, but really gains specificity depending on the type of client the firm is serving.

Selection: CLA’s history with Sage Intacct goes back to Langan Associates PC, a Washington, D.C.-based firm that was acquired by CliftonLarsonAllen in 2006. Langan began using Sage Intacct in 2001, serving primarily nonprofit clients; today, CLA provides outsourced services via Sage Intacct to a broad range of industries, from nonprofits to tech companies.

Intacct, the predecessor to Sage Intacct, was founded in 2000, just one year before Langan adopted the software. The firm sought a cloud-based solution that would allow for better client collaboration at a time when the cloud was relatively new. “When I joined the broader firm in 2006, CLA embraced how technology would have a significant impact in enhancing client relationships,” Mathew, who joined CLA from Langan, said. “There was education across the firm on using technology to improve our processes around outsourced accounting services.”

Mathew noted that the firm has looked at different cloud software since, but Sage Intacct “sets a benchmark in terms of its IT infrastructure as a whole.”

Implementation: “When we started with Sage Intacct in 2001, we gave ourselves a little time to migrate clients,” Mathew said. “The first was a physician’s practice, the brother of one of the firm’s managing partners. We were really getting to know the software.”

By the time Mathew joined the firm, Langan was deep in the process of migrating all outsourced accounting clients in D.C. to Intacct.

“I went through that initial onboarding myself,” he said. “It was a great learning experience for me because I learned the ins and outs of what makes accounting systems so great; at the same time, I quickly saw we were bringing value to clients that they hadn’t seen before.”

Today, CLA has a 35-person in-house implementation team for Sage Intacct.

Highlights: Mathew described Sage Intacct as a software accountants love, but that is also very accessible to non-accountants.

“I really like how Sage Intacct has taken the complexities associated with financial reporting and makes it easy to understand,” Mathew said. “The software goes above and beyond to make reporting simple and easy to understand. It’s easy to map out trends over time and see what impact even non-financial data has on financials overall. We’re able to engage with stakeholders more deeply than just sending them core financials.”

Challenges: “Intacct’s been very solution-minded,” Mathew said. “If we come to them with a problem, they definitely make sure to figure out how we can address it. For example, if it’s making onboarding clients simpler, they say, ‘Can we build these tools to streamline and better automate this for you.’”

Firm growth: “In terms of growth overall, Intacct is one of our faster-growing verticals as a whole,” Mathew said. “When you combine that with the overall outsourcing practice, it’s really enabled our staff to dive deeper in their relationships with clients. We are automating more processes, which enables our team to be that more strategic advisor for our clients.”

Easy on the eyes

Firm: High Rock Accounting

Staff: 8

Product: Xero

On record: Liz Mason

Selection: Like Xero, High Rock Accounting was “born in the cloud,” founder Liz Mason said. This is part of why she selected Xero as a solution back in 2013, a year before her firm was officially founded in 2014. At the time, she was “on the hunt for an up and coming software capable of doing everything we needed that wasn’t crazy expense” — and Xero fit the bill.

Implementation: Mason said that implementation of Xero could almost be seen as an ongoing experience, as each time a client converts over to the software the firm goes through an implementation of sorts over again. How easy that implementation is depends on the client’s historical data — sometimes, High Rock has to help their client clean up their records before the convert. TOday, however, Mason noted, there are more auytomated conversion systems and convenient templates available to facilitate migrations.

“If a client has a clean data file in their historical accounting system, you should be able to do the transfer in a day,” Mason said.

Highlights: Xero’s Find and Recode feature, introduced in 2015, is one of Mason’s favorite features. It allows the accountant to conduct a very detailed, specific query for a certain code or almost any factor of data that is tagged, and change, or recode, that tag in a batch rather than one by one. “It saves a ton of time,” Mason said.

Mason also highlighted Xero’s pleasing user interface. “I like very well designed things,” she said. “I dislike poor design. Other software designed by engineers gives me anxiety to look at. And it’s fast — very fast.”

Finally, Mason said that Xero’s app marketplace is an asset.

“One of the other pieces of Xero we like is how many apps integrate so well with it. I’ve found in other software, integrations are lacking. There are issues and errors. Xero integrations are more streamlined and work better.”

Challenges: Mason has found that if a client is used to a different software, they expect Xero to be able to do the same things that other software may have done for them.

But “Xero has taken all this feedback into development, and they started releasing a whole lot more on that side,” Mason said. “For instance, Xero was trying to build out payroll and they were doing OK at it. But they weren’t in all 50 states, and there were still manual pieces. So they partnered with Gusto and they now have an extremely robust integration. Payroll is now effectively offered internally.”

Firm growth: The Xero team has been very supportive to High Rock Accounting, Mason said. For instance, Xero has a program where they give firms marketing dollars to expand their brand. The program works as a dollar for dollar match on what a firm spends on marketing — silver partners like High Rock get up to $2,000 a year.

“The technology itself is so efficient that we’re able to take on more work without hiring more people,” Mason said. “It’s given us the ability to grow.”

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