Post on 31-Jul-2015
Walt Disney WorldSwan and Dolphin Resort
Orlando, FL
D01 –Technology – The Great Enabler for Virtual CFO & BPO Services
June 8, 2015 10:15 AM – 11:30 AM
Thomas R. Gawne, CPA – CPA.com
#PSTechIN PARTNERSHIP WITH
American Institute of CPAs® #PSTech
Thomas R. Gawne, CPA
• Professional Services Systems Engineer
• 29 years in the tax and accounting technology sector
• Consultant & Facilitation Leader
American Institute of CPAs® #PSTech
Agenda
Introduction
New Value Services & Key Strategies
Technology Implications
Workflow Implications
Wrap-Up
American Institute of CPAs® #PSTech
Firm Value Chain
Input Data
Assemble
& Verify
Report
Analyze &
Interpret
Advise &
Consult
Higher Value & Future Focus
Lower Value & Historical Focus
American Institute of CPAs® #PSTech
BeforeTransactional
Save time and reduce cost by standardizing and leveraging automation and repeatable processes
Increase real-time collaboration with clients by accessing information in the cloud
Increase margins by providing higher value with increased productivity
TodayAdvisory
Low margin transaction processing
Means to an end; a tax return Pressure to keep fees low Non-strategic
Changing Landscape
American Institute of CPAs® #PSTech
1990
2000
Today
Transformation of Client Accounting
Today’s
opportunity
Cloud-based
Integrated
Paperless
Dashboards
Real-time
Small businesses push work back to firms to
focus more on their business
Role of firms reducedQuickBooks introduced
to small businesses
American Institute of CPAs® #PSTech
Today: Disconnected Systems Ideal: Connected/Holistic
QuickBooks POS Payroll
Manual Processes
Restaurant Managers
Many checkbooks
Several locations Bookkeeper Inventory
Restaurant
Group
To Transform Disparate Systems
American Institute of CPAs® #PSTech
Accounting Services Today
The Opportunity
• Ride the wave of demand for outsourcing
• Leverage cloud technology to achieve:
- greater levels of productivity
- closer collaboration with clients
- delivery of deeper levels of wisdom & insight
American Institute of CPAs® #PSTech
Key Strategy – Get Vertical!
Business Intelligence Reporting
Real-Time Client
Collaboration
Standardized Workflows
Client Accounting Capabilities
driven through cloud
computing technology
• Professional Services –
90%
• Construction – 76%
• Retail – 75%
• Not-for-Profit – 73%
• Manufacturing – 65%
• Wholesale Distribution –
61%
• Technology Companies –
59%
• Transportation – 48%
• Hospitality – 45%
• Franchises – 40%
• Government – 29%
Most Popular Client Verticals for Outsourced Accounting Services
American Institute of CPAs® #PSTech
Key Strategy – Assemble Staff
Partner-in-Charge CAS Business Group
Business Development
Marketing/Sales, Finance, Human
Resources, Technology, etc.
Director of Client Accounting Services
Virtual CFO
Implementation & Client Support
Services (separate positions as the firm grows)
Client Relations (Client Scheduling,
Contract Maintenance, Client
Satisfaction)
Virtual Controller
Accounting Manager
Accounts Payable
Accounts Receivabl
ePayroll
American Institute of CPAs® #PSTech
Steps in the Prospect-to-Client ProcessKey Strategy – Well Orchestrated Approach
American Institute of CPAs® #PSTech
1. Prospect Qualification
Standardized questionnaire
Keep high-level
Develop the right questions that fit your business model & vertical niche
Prospect Qualification
American Institute of CPAs® #PSTech
2. Client Assessment
On-site or virtual/remote client assessment
Understand and document current workflow and procedures
Document transaction workflow, procedures and best practices
Assessment is a paid-for service with a deliverable of a final analysis
Client Needs Assessment
American Institute of CPAs® #PSTech
3. Short Term CFO/ Technology Consulting
Short Term CFO/Technology Consulting
Typically short term implementation services
Possible data migration
Clean up to enable on going services
American Institute of CPAs® #PSTech
“Bread & butter” of a BPO firm
Construct as packages: bronze, silver, gold so that there is a fit for most budgets
Collect fees before the services are provided
Develop deep knowledge in the verticals you focus on, constructing industry specific KPI’s
Ongoing Services
4. Ongoing Services
American Institute of CPAs® #PSTech
3. Short Term CFO/ Tech Consulting
4. Ongoing Services
2. Client Needs Assessment
1. Prospect Qualification
Key Strategy: Prospect to Client Process
American Institute of CPAs® #PSTech
Key Strategy: Firm/Client Collaboration
Close CPA firm and client collaboration to deliver better financial advice, help them make faster, smarter business decisions and improve their financial performance
Facilitates real-time vs. after-the-fact decision making
Focus on technological improvements to enable heightened collaboration and are making shifts to their client accounting services practices
American Institute of CPAs® #PSTech
Client Accounting Services
• Firm typically has 25-200 clients
• Clients have $1 - 5 Million annual revenue
Firms are charging value-add bundled retainer fees for these services – $1,500 - $5,000 / month and beyond!
Most Common Services:
• Financial Statement
Preparation
• General Ledger/Trial
Balance
• Payroll Reporting
• Cash Flow Management
• Payroll Preparation
• Transaction Processing
(BPO)
• Virtual CFO ServicesMajority of Outsourced Accounting clients have between 5-25 employees
CPA Firm Client Accounting Services Profile
American Institute of CPAs® #PSTech
Client Expectations are Evolving
Digital CPA
Transactional
Workflow
Using technology to support transaction processing
Build digital workflow and standardization in processing
The operating model of theDIGITAL TRUSTED BUSINESS ADVISOR
It’s not just about technology!
It is also about your strategy!
American Institute of CPAs® #PSTech
Growth of Cloud Computing
And Many Others
Small BusinessHas Moved to the Cloud
Network growth: >150% last year$150M recently
raised
QuickBooks® Online 500K users
Paychex Equity Investment
Efficiencies saving 90 minutes per employee per day
Serving over 10k firms and top US banks
$45M recently raised
American Institute of CPAs® #PSTech
Widespread Adoption: The Great Equalizer
Top 100 Top 500
Small Firms
American Institute of CPAs® #PSTech
Partnering for Success
120+ partners 75% of our customers integrate with 2+ partners
TIM
E &
EX
PEN
SEMAN
UFAC
TURI
NG
BUDGETING &
PLANNING
HR/PAYROLLSUBSCRIPTION
BILLING
PAYMEN
T
PRO
CESSIN
GAP A
UTO
MAT
IONDOCUMENT
MANAGEMENT
ASSET
MANAGEMENT
TAX MANAGEMENT
CR
MEDI &
ECOMM
ERCE / POS
CHECKS & SUPPLIES
PROJECT MANAGEMENT
INVENTORY
MANAGEMENT
American Institute of CPAs® #PSTech
Service Delivery Platform
The service delivery platform is a term used regularly in the “cloud-computing” world
• Defined as the available technology components and/or solutions that will be used in the client accounting service delivery model
For example: could include the following integrated business solutions
• Intacct Financials-on-demand
• Bill.com cash flow and bill management
• Paychex integrated payroll services
• XCM workflow management
American Institute of CPAs® #PSTech
KPI’sNumber of table turns
Food categories
Turnover of total room
Guest Counts (growth)
Per person Average
Controllable Income
Average Ticket Price
Food & Beverage Mix
Historical vs current
Total # of seats
Comps
Other MeasurementsPrime Costs
• COGS + total labor + ee benefits
Food & Beverage Mix
• Revenue 60/40 average• COGS 33% food; 25% bar
13 week periods
Labor
• Mgmt 4%; direct 14%; other 5%
EBITDA: 25-28%
Beyond Financials to Real Time Client Insight
American Institute of CPAs® #PSTech
Restaurant operators
Scrutinize food and beverage costs
margin by menu itemby location by server
Business actions that increase gross margins
Role-based dashboards
Management by KPI’s
Reporting Examples
Food Sales
Liquor Sales
Other Sales
Food Sales
Food Costs
Food Margins
American Institute of CPAs® #PSTech
Begins With The Standardized Practice
Consistent/standard Chart of Accounts (COA) as one package price. Premium fees for a custom COA
Standardized services by industry vertical and by type of service
Standardized Internal Management Reports/Services
Procedures Manuals for each client
Service Order Requests for services outside of the engagement agreement – retainer always on account for these requests and for “concierge” services
Dedicated client-service staff to provide top client experience, while sheltering our production staff
Standardized workflow to deliver insight
American Institute of CPAs® #PSTech
Importance of Standardizing Workflows
•All deposits made and updated into Intacct•Client submits check requests/invoices into the Bill.com system by 5pm
Tues.
•Staff codes and enters everything •Manager reviews/approves and submits for payment or returns for correctionsWed.
•2nd batch of deposits made and updated into Intacct•Manager analyzes cash flow, payables, and deposits•Manager creates dashboard showing what to pay
Thurs.
American Institute of CPAs® 34#PSTech
Roles and Permissions
Create user profiles for client
Assign a role based on permissions
o Administrator
o Accountant
o Payer
o Approver
o Clerk
o Customized roles with over 30 options
American Institute of CPAs® #PSTech
Send bills into Bill.com
Emailo Customized Bill.com email
Faxo Choose your area code and
Bill.com assigns a fax number to the account
Upload
Inbox
37
American Institute of CPAs® 39#PSTech
Synchronize to General Ledger in the Cloud
Syncing Intacct
QuickBooks Desktop
QuickBooks Online
Netsuite
Xero
Import/Export
itduzzit.com
American Institute of CPAs® #PSTech
Restaurant operators
Scrutinize food and beverage costs
margin by menu itemby location by server
Business actions that increase gross margins
Role-based dashboards
Management by KPI’s
Insight Flows to Real-Time Dashboards
Food Sales
Liquor Sales
Other Sales
Food Sales
Food Costs
Food Margins
American Institute of CPAs® #PSTech
Final Thoughts
Leverage the outsource demand
Build your right model with your right strategy
Increase your collaborative engagement with clients
Select and deploy the right cloud technology tools
Build your standardized workflow
Be prepared to delight your clients!
American Institute of CPAs® #PSTech
Upcoming Roadmap Workshop
August 11th & 12th
AICPA New York Office1211 Avenue of the Americas, 19th FloorNew York, NY 10036