CPAs started installing automated fixed asset management systems decades ago. Todd Blome, a partner at Lincoln, Neb.-based Basso, McClure, Goeglein LLP, first installed BNA Software's fixed assets application over 15 years ago, when DOS was still the No. 1 operating system.But while many features have been added and the ease of use has improved, fixed asset systems are not going online or making any other technological leaps any time soon.
Providers say that fixed asset systems are not experiencing any major growth spikes either, despite Sarbanes-Oxley regulations, which have focused attention on compliance and led CPAs to buy more detailed accounting software in the last few years.
"SOX has not had as big an impact on our users because our clients tend to be smaller or medium-sized businesses versus large corporations. But legislation that passed following 9/11, and most recently after Katrina, has made our solution an important tool," said Michelle Macauba, senior product manager for QuickBooks Pro Series Fixed Asset Manager.
However, CPAs are still big proponents of automating their and their clients' fixed asset depreciation calculations and reporting.
"It's a humongous time saver! I did [depreciation calculations] with spreadsheets before, but because of tax laws changing so much, you have to keep track of ACE, AMT and four or five other methods of reporting," said Terry Rogers, chief financial officer at Smith Newspapers Inc., in Fort Payne, Ala., and owner of CPA Alliance, a small firm with clients in 12 states. "And updating would take four or five hours. Now, with one button, the information just rolls over."
Federal and state tax laws change every year, and keeping up with those tax laws in terms of fixed assets can be daunting to many. Providers of automated fixed asset management systems all have teams of researchers, mostly CPAs themselves, deciphering which tax laws will affect their respective accounting solutions.
"We have a team of CPAs in our Herndon [Va.] office who carefully watches what's passed on the Hill and what's being discussed, not just in what may pass a week or a month from now, but also what they are proposing for the future," said Sam Hunter, senior product marketing manager at Sage Software, a provider of fixed asset management and other accounting software systems. "Some actually sit on committees on the Hill. The updates [to the FAS system] are available online as soon as they are released from the Hill."
All the providers interviewed - CCH, QuickBooks, Sage Software and Creative Solutions - release their software updates online for their users to download. However, only Creative Solutions has its fixed asset management software online, as part of its CS Professional Suite.
The argument for or against an online system is no different than for any other software system that a CPA might use, because all hold more or less the same confidential data - Social Security numbers, bank account information, federal identification numbers, revenue figures, etc. But while many online accounting packages such as QuickBooks Online Edition and Sage Software's ePeachtree are experiencing good sales figures, there is hardly a strong demand to move fixed asset systems online.
CPAs like Blome indicated that they don't feel safe releasing such confidential client data over the Web. "I prefer to keep it in-house rather than hosted," said Blome. "Maybe it's because I'm a control freak, but I like knowing where my data is and that it's backed up. If for some reason I don't have an Internet connection, I still want to be able to access my data."
Conversely, there are CPAs like Smith Newspapers' Rogers, who uses Fixed Assets CS specifically because it is online and says that he has no worries about security issues.
"Those CPAs are crazy. Creative Solutions, or Thomson, who is the parent company, has a Class IV data center, and there are only 10 of those in the world. Do you know what it takes to be a Class IV data center? It means you have to have a military tank out front. I don't think many of my fellow CPAs have that kind of system. There is no way that is getting hacked into," he said.
Teresa Mackintosh, vice president of marketing at Creative Solutions, denies that there is a tank outside the facility, though she does say that there is "crazy growth" in CS's hosted suite model. She also noted that the data center's information is encrypted going both back and forth from the CPA's PC, back-ups are automatic, and the hosted model is a "very cost-effective way to have bullet-proof security."
According to product managers for Sage's FAS Fixed Asset product line and CCH's ProSystem fx Fixed Assets, there are no plans to move online any time soon, because the demand just is not there.
What is always in demand is more integration between fixed asset systems and back-office accounting solutions or tax software applications from other proprietors. In May 2004, Sage and CCH entered into a partnership that includes further integration of their respective products.
Randy Fraley from CCH, product manager for ProSystem fx Fixed Assets, stressed that further and tighter integration between CCH and Sage products, including ProSystem fx Fixed Assets and Sage's accounting solutions like the MAS product line, will be available in the near future.
"We're also trying to get into the corporate side of the market. We'll enhance what we have with reports and make it more flexible for larger companies. That is more of a long-term goal, within the next two or three years," said Fraley.
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