We all know 2020 has been a challenging year. So it should come as no surprise that this year’s accounting firm challenges were dramatically different compared to past years. Agile firms were able to face these new challenges head-on with technology. In a recent webinar, Wolters Kluwer’s Jim McGinnis discussed recent survey results about how the profession has adapted and how digital transformation, including real-time access to data, a centralized database, task automation, and data analytics skills, helps firms build resilience.
Challenge: Keeping track of changing legislation
Last year, firms’ top concern was trying to keep up with changing technology (46%). However this year technology took a backseat to changing legislation (54%). With COVID-related regulations like Paycheck Protection Program (PPP) loans and the CARES Act, clients needed extra help navigating applications and other paperwork.
Solution: To handle the disruption during busy season, firms relied on CCH Axcess iQ to make sure they weren’t missing any change that might affect a client’s return—and to help clients understand the background behind the changes. Successful firms also leveraged the predictive intelligence tool to find opportunities for new services like tax planning and business consulting.
Challenge: Working a longer filing season
Last year, completing work accurately and on-time was one of the top accounting firm challenges (31%). In contrast, working a longer filing season was a top challenge (54%) in 2020. With the July 15 filing extension in 2020, firms had a lot more time, but that wasn’t necessarily a benefit. In some cases it just caused deadlines to clash.
Solution: Tech-savvy firms relied on CCH Axcess™ to minimize busy season compression and get some time back. Firms that are able to automate data collection will be more prepared to succeed. Preparers can save time with CCH Axcess™ Client Collaboration for data ingestion and managing time-consuming client interactions. And they can use CCH Axcess™ Financial Prep to bring cloud-based data directly into business tax returns.
Challenge: Clients late or unprepared
In past years, meeting or exceeding client expectations was one of the top accounting firm challenges (36%). However, this year it was a major challenge just to get clients to come to the party. Almost half of firms said late and unprepared clients were a challenge (49%), especially when it came to trying to collect client information digitally.
Solution: CCH Client Collaboration is the next evolution of client portals because it provides a simple and secure central hub where firms and clients can exchange information and documentation. With interactive, customizable organizers, a built-in digital, end-to-end 8879 process, and more than 250 new features and enhancements planned for tax year 2020, firms will be wondering how they ever lived without it.
Challenge: Operating business amidst the worry for health of family, staff and clients
If nothing else, 2020 was a year of worry. Although in past years, much of the anxiousness has been about growth (28%) and information security (37%), this year piled on concerns about the health of family, staff and clients (40%) as well as keeping themselves safe.
Solution: Cloud-based solutions allowed firms to stay safe at home, even though they didn’t necessarily need to as essential businesses. With staff able to work from anywhere, any time—across all industries—the cloud is only going to get more sophisticated in the future with more APIs, more real-time access to data, and more collaboration than ever.
Challenge: Extended tax deadline and stay-in-place orders creating revenue gaps
Even for those firms that had technology in place to quickly pivot to virtual and other touch-free processes, the effects of the pandemic still created revenue gaps for many firms (38%). Compared to last year, in 2020, fewer firms reported revenue growth, and unfortunately more firms reported revenue declines.
Solution: Technology early adopters and innovators performed better in 2020 in terms of revenue, profitability, and number of services provided than mainstream or late adopters. Whether it’s another pandemic, a flood or fire, or a personal health issue, a firm’s approach to technology has a lot to do with how quickly and successfully they can pivot. Dynamic real-time dashboards and predictive intelligence helps create resilience and agility so firms can be proactive—and even predictive—rather than reactive.
Ready to build your firm’s resilience and be ready for whatever comes next? View the “Forward Together: Building Resilience through Innovation” webinar.