by L. Gary Boomer

The early adapters started implementing paperless solutions in accounting firms back in the mid-1990s. Today, there is widespread adoption, and the results seem a lot like those of a decade ago.

The issues seem consistent, regardless of the size of the firm. The following rules apply:

● There must be a champion.

● The firm must have standards, policies and procedures.

● Training is required.

● Partners and staff who do not comply with policies should be terminated.

● Dual monitors improve the efficiency of the review process.

● The return on investment is 25 percent in the second year, and 35 percent in the third.

A champion

Clearly, someone must step up and provide leadership, and they must have the confidence, resources and support of the managing partner in order to succeed. Too often, partners expect the firm administrator or information technology department to implement integrated financial reporting and document management.

Everyone in the firm must be involved. Get everyone off the bench and onto the field. Document management is not a spectator sport.

Standards, policies and procedures

Firms that succeed in this area define their policies and procedures in writing. This starts at the top, and is especially difficult in many smaller firms, where the mode of operation is for multiple partners to have individual practices while sharing overhead.

To succeed in the digital environment, there must be standards, polices and procedures. Also, it is inefficient to have both digital and paper systems.

Start developing these policies and procedures by referring to the firm’s vision and strategic plan. New technology should be aligned with the goals of the firm. Better client service, increased profitability and efficiency typically drive the paperless initiative.

Utilize a document management task force to define existing procedures in the form of a flowchart or block diagram. Evaluate your workflow and determine if the procedures can be re-engineered for efficiency. Don’t be afraid to look to your peers or to bring knowledgeable people in from the outside to help the process along.

It is often difficult to improve an existing process if you are part of it. Gravitation back to the old way is common. Therefore, changing employee responsibilities and job descriptions will often assist in improving procedures and implementing a paperless system.

Expect revisions in your procedures as you advance.


Training is typically the forgotten ingredient in the recipe for success. Many firms are too busy to train and, therefore, waste valuable time and further frustrate their employees.

A training culture also starts at the top. The partners must be committed to the training process and should set the tone by attending classes and being engaged in the process. Training to a set of standards, policies and procedures is much more efficient than training to individual preferences.

The Gartner Group uses a multiplier of five. For every hour that you spend in training, you eliminate five hours of inefficiency and frustration. “Playing around” is not an efficient training strategy.

A training director is a key ingredient for firms to successfully implement document management. Training directors serve as transformation agents. They must be positive, possess great communication skills and display a readiness to accept change.

Typically, they are not accountants, but professional educators who are capable of defining training requirements, establishing curricula and coordinating all types of training (continuing professional education and technology).

The common mistake that most firms make in the training area is to name an accountant as the training coordinator or director. Most partners believe that you must be an accountant in order to teach accountants. Successful firms have proven this premise wrong.


Many partners and other long-term employees in accounting firms often believe that they are exempt from firm policies and procedures. Designing systems around a partner who does not want to change is bad business.

This is probably the area of greatest frustration for information technology personnel, trainers, firm administrators and staff. No firm seems to be exempt. Therefore, it is necessary to have a well-defined vision and strategic plan before embarking on a project that is as monumental as document management.

It is not unusual to hear that a firm has installed an integrated financial reporting system with paperless work papers only to learn that few, if any, of the partners know how to use the system. Review by the partners is often done by printing all the documents. This does not make sense.

Partners should be capable of learning and growing. If they can’t, either the system is too difficult or they are not committed to change and personal development.

In order to be fair to all parties, enforcement requires written policies, procedures and training. The excuse that personnel are too busy to participate in training is invalid if the IT initiatives are tied to the firm’s vision and strategic plan.

Enforcement requires “edge” - the ability to make tough and often unpopular decisions for the betterment of the firm and improved client service.

On-screen review

Every organization that has implemented a document management system has evolved through a series of phases. Once documents are captured digitally, users often want to print the document to view it.

This process is also true in accounting firms. Over a period of time, the procedures will evolve. In order to reduce this time period, you may eliminate several phases by simply going directly to dual monitors on the desktop. This will allow reviewers to view the source documents while viewing the tax return or financial statement.

The managers of a leading firm recently told me that they did an analysis of paper usage in their firm. Each full-time equivalent was using four reams of paper per month. It is not only the cost of the paper, but the filing, retrieval and shredding of old versions that becomes expensive.

You can do your firm a favor by eliminating printers in the offices and directing all printing to a centralized area. If you are determined to print, consider implementing a charge-back system that captures all print jobs by clients. You will be amazed at the number of versions that staffers print before approving the final copy.

The return on investment

Return on investment is difficult to determine if you don’t establish benchmarks before implementing integrated financial reporting and document management. This opens the door for emotional opinions rather than factual metrics.

We developed a model where firms can enter current statistics and assumptions prior to starting a project. Most firms find they are spending from $85 to $125 per client per year on printing, storage, retrieval and backup of client documents.

These costs can only be reduced by utilizing technology as labor costs continue to escalate. What is the cost of finding lost files and documents in your current system? Being able to retrieve documents from any location at any time is very important to most firms.

Billing practices are one of the keys to the firm’s return on its investment. If the firm continues to bill by the hour, most of the return will be passed along to the clients. Therefore, it is important to monitor client hours, as well as services, in order to determine the return.

During the first year, firms experience a learning curve, as well as a tendency to overaudit and underutilize the technology. With training, improved procedures and experience, the hours are reduced and the workflow automated.

Typically, firms report a 25 percent reduction in time on most engagements for the second year. This increases another 10 percent or greater in the third year. Returns are maximized if there are no exceptions. It is best to learn from larger engagements, then utilize that experience in transforming all engagements.

Each day that your firm waits to update its core production system, the ultimate cost of document management increases. Ninety percent is cultural and 10 percent is technological.

The hardware and software are already proven.

Is your firm up to the challenge?

Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access