Workload compression is biggest concern of CPA firms

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CPA firms were more concerned about various impacts of workload compression than with updating their clients and staff about the latest tax law changes, according to a new survey.

The survey, by the technology company Right Networks in partnership with the CPA Firm Management Association, polled 162 accounting firms after tax season and found that workload compression in different forms, especially its impact on firm morale and quality control, was a top concern for 40 percent of CPA firms as they headed into the 2019 tax season. Another one-third of CPA firms polled were most concerned about keeping accounting staff and clients updated on the implications of the newest tax law changes. This tax season was especially challenging for firms dealing with the new tax law that took effect last year, with 55 percent of respondents indicating this busy season was either substantially more difficult (23 percent) or slightly more difficult (22 percent) than previous ones.

“Entering tax season, firms were balancing workload compression with the education of staff and clients on the implications of the Tax Cuts and Jobs Act,” said Roman Kepczyk, director of firm strategy at Right Networks, in a statement. “Add in late legislative updates on tax software and you can easily understand why most firms were in scramble mode from the very start of busy season.”

To manage their workload better, many firms said the most impactful change they made prior to tax season was software improvements, with many firms using digital signing and e-filing technology, going 100 percent paperless and updating their tax software. Seventy-five percent of firms also hired more staff. While the hiring of extra accountants was common, many firms also upped the number of administrative hires and interns to help with non-tax related work this year.

Hiring new staff brought its own problems, though. “Fifty percent of firms said training new personnel on firm systems was a significant challenge, compared to just 22 percent that said training on new legislation was difficult,” said Kepczyk. “Given this, firms may now be more motivated to proactively train new hires and interns earlier in the year, before busy season, and provide more ‘just in time’ training throughout the first two months, which is an area where we have traditionally found firms lacking.”

The survey asked respondents about the benefits of hosting tax apps in the cloud, and 72 percent favored "anytime, anywhere" access, while 67 percent see the cloud as a secure environment (the respondents were polled before the recent problems at Wolters Kluwer), 34 percent cited improved collaboration with personnel and 20 percent saw improved collaboration with clients. The collaboration may have also had an impact on total work hours. “Forty percent of CPAs said they worked ‘about the same’ while 45 percent said ‘substantially or slightly more,’ which is not as big a difference as we might have expected, given the challenges this tax season presented,” said Kepczyk.

Lack of in-depth training on applications, processes and equipment was the main regret of firms leading up to tax season, cited by 39 percent of respondents. Staffing was seen as essential for addressing major bottlenecks before next tax season. Firms predicted they would hire more quality mid-level staff, more experienced administrative staff and more interns, while also dealing with bottlenecks at the review stage.

“Tax season is always the most stressful time of year for CPAs, and 2018 filings were expected to be the most complicated in recent memory,” said Kepczyk. “Yet it appears that a combination of increased staffing and use of cloud-hosted applications helped firms successfully meet the challenge. Looking to 2020, 40 percent of firms expect to implement more in-depth training, which should lay the groundwork for a productive and smooth tax season.”

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Practice management Tax practice Tax season Cloud computing Tax prep software