TechTimes CPAConnections News From Your Association Leaders
August 2018
An interview with the 2018 CPAConnect chair:
Celebrating our:
Erin Anker of Phillips Anker, PC, leads the 2018 advisory committee Erin Anker is the 2018 CPAConnect Advisory Board Committee chair. She believes in helping small businesses by standing as an advocate against fraud for her firm’s clients. In addition to being a CPA, Anker has also earned designations as a Certified Fraud Examiner (CFE), Certified in Financial Forensics (CFF), and Certified Valuation Analyst (CVA). She Erin Anker is also the managing partner and , shareholder with located in Austin, Texas, and recently spoke to us about her time as chair. We started by asking about the
changeover to advisory committee chair. Anker said, “I had volunteered for the advisory committee after one of the [CPAConnect] Roundtable events and I thoroughly enjoyed the planning calls and loved participating. I believe that advocating for our membership is one of the most important roles for the chair. I am hopeful that this year will be a very fruitful one. For the transition piece, it was quite smooth, transitioning from Craig Franklin (what a smart guy!). This is a great team and we do whatever we can do to best help our membership.”
relationships and it provides the ability to reach out when information is critical; sometimes we may need to refer an engagement out and it is important that we have credible and reliable firms that we refer our clients to. If we have built this relationship with them via CPAConnect, then we are going to be comfortable referring our clients to them if they need something. We have done this (multiple times), and likewise, have had clients referred back to us.
When asked what she likes about being a part of CPAConnect, Anker said, “The collaboration with the other firms. Our sharing of information is invaluable. It has led to great business
Business always poses challenges and we asked Anker what is at the top of her list. She said, “I would say adapting to the impact of technology to our business of public accounting. Ten
Read Erin Anker, continued on page 2
Tech Corner with Randy Johnston
Look to the Future - Protect Your Firm by Being Proactive on AI and Automation We will need to take our firms through a technology transition in the next five years that is unlike anything that has come before. While you may believe that the transition from DOS to Windows, the arrival of the Internet, or the use of cloud technology were big things, the use of Artificial Intelligence (AI), Machine Learning (ML) and other emerging technologies such as robotic process automation (RPA) will deeply change the practice of public accounting. How can you help keep your firm on the right track? It certainly won’t be done by doing the same old thing, but the risk won’t be mitigated by jumping to new technology too early either. CPAmerica has been managing Innovative Technology calls
to investigate emerging technology options as a group. This group leverages the expertise of many for the good of all. However, we each have different technologies we discover, we have different client needs and we have different strategies for our firms. Remember that you are still well-served having a strategic plan and tactical objectives for the firm which are then incorporated into a technology strategic and tactical plan. We still must get day-to-day work done in tax, audit and other core services. Some firms have added a focus in Client Accounting Services, Wealth Management or other high growth areas. Each niche has an opportunity to leverage emerging technology and you should watch for tools that help each practice area.
What Are the Top AI and Automation Opportunities?
Wherever there are a lot of transactions or data, there is an opportunity to automate. You have already seen the opportunity to reduce the amount of effort needed to use bank or credit card feeds to capture transactional data if you use online accounting software. Some of you are using expense management software to capture transactions and reduce the effort to manage expense reporting. These simple examples leverage the benefits of centralized cloud computing. Over time, computing power has gone from centralized to distributed back to centralized and is preparing to shift back to more distributed capabilities. The new wave of distributed computing is a result of widespread use of mobile computing power and from the reduced cost of graphics processors which can accelerate ML and AI.
See AI and Automation, continued on page 3
Erin Anker, continued from front page years ago, our firm became paperless, and today we are talking about cryptocurrency and blockchain. Not only how to handle it from a regulatory perspective but from a working office point of view. How will our clients embrace it? We know businesses are using it and we need to be ahead of the curve. One of our clients is Texas Bitcoin Association. Not only did we attend their conference last fall, but we were able to present a session on tax implications, while learning a lot from other presenters. Kevin Connor is a font of information on our CPAConnect Discussion List for cryptocurrencies. Cryptocurrencies are hot topic today and the last thing we want is for any of our existing clients to ask us about cryptocurrency and us not be knowledgeable. We made the decision years ago that we would always have the latest edition of QuickBooks and the latest edition of the Office products because we are a technology-driven firm. Any CPA firm is. We use the best software we can afford to service our clients’ needs. One of the biggest challenges is the impact of technology, the other is staying abreast of current tax law that is out there. This last tax law has everyone interpreting it as we speak. Earlier this month, the IRS issued 184 pages of guidance on the new tax law. Our clients expected us to be up on this law, right after it was issued last December – and you see that it took the IRS eight months to put together their guidance. We asked Anker about her firm’s commitment to organic growth. She said, “Yes, we want our clients to grow their businesses. Our relationships with our clients are critical - it must be a good fit for both parties, so that we can be successful in helping them achieve their goals. We don’t take every client that calls us. It’s important to remember that as you are growing as a firm and staying up with technology, your rates should be increasing. We all know there are clients who don’t appreciate those rate increases and Celebrating our: it’s okay to let them go – it’s part of the business cycle. It took us a while 2
to figure that out, but with the help of CPAConnect and our sponsor firm, we’re able to confidently raise our rates each year and fire clients that need to be fired.
it really does have to be able to sustain itself.”
We asked her what she saw in store in the future. Anker answered, “I see us as continuing in the realm of serving our client community as trusted advisors. In the past, we’ve worked as a typical CPA firm with tax and accounting issues, but we are moving more towards that of trusted advisors and educating our clients as to just what a trusted advisor is and helping them to grow their businesses while keeping them educated in the regulatory environment of tax law. Additionally, we hope to continue to educate them on the issues surrounding cryptocurrency and blockchain. It’s not all accounting for Anker, though. In her spare time, she loves to read and said, “you would think that after leaving work that the last thing I would want to do is read. I usually can’t wait for the next Vince Flynn, Brad Thor, or Lisa Scottoline novel to come out – I thoroughly enjoy those suspense thrillers. I also love to play in my garden. I’m a lazy Texas gardener –
Please send us your firm’s news! releases, we can share your good news with your fellow members and include the information in the next issue of CPAConnections. Please email any news about your suggestions or story ideas to: omolina@cpamerica.org
CPAConnect members are elegible to attend several CPAmerica events in grow in key areas CPAConnect’s alliance with CPAmerica has its perks - one of these is having access to several niche members-only events. Coming up this fall 2018, the CPAmerica Tax Conference opens on November 4-7 at the elegant Ritz Carlton in historic New Orleans, Louisiana, with its focus on the most recent developments in the area of tax.
New Orleans will be the site of the 2018 CPAmerica Tax Conference on November 4-7.
Also available for CPAConnect members will be the CPAmerica International Group Meeting, being held on December 3-6 at the Four Seasons Hotel in Atlanta, Georgia. For more information on how to attend any of these events, please contact Director of Member Services D’Yãn Davis at: ddavis@ cpamerica.org
The CPAmerica International Group Meeting at the beautiful Four Seasons Atlanta on December 3-6.
2018 CPAConnect Roundtable:
New Orleans Come to the 2018 CPAConnect Roundtable
Being held this year in New Orleans, La. (a.k.a. The Big Easy) on Oct. 31-Nov. 2 at the elegant Omni Royal Orleans. CPAConnect members can call the hotel at: (504) 529-5333 and reference “CPAConnect” to receive the group rate of $219/ night plus tax (this rate will only be available until Oct. 9, 2018 at 5 p.m. CT). You can also make your reservation on the Omni Royal Orleans website: www.omnihotels.com/hotels/neworleans-royal-orleans This annual conference focuses on Practice Growth and Management So come to New Orleans, earn CPEs, listen to great speakers, and reconnect with your peers!
AI and Automation, continued from front page Recognition capability, commonly referred to as Optical Character Recognition (OCR), has continued to improve, but adding AI, ML and other techniques improve accuracy. Having a local graphics processor can speed up AI and ML. If a document is presented in paper form, the accuracy of translating the image’s numbers and words continues to improve approaching 100 percent. Of course, it is better to capture the data in the original format which means we will download the transactions from a bank or from an accounting software system. Another rule to apply is that if an accountant is keying data, there is a broken process somewhere - your team should not be keying data at any level. We have seen and experienced the first wave of 1040 workpaper automation with tools like CCH Scan, SurePrep and Copanion GruntWorx. While these products are 10 years old, their capabilities were largely built with manual forms and computing power, not with AI and other advanced techniques. Consider what happens if we can ingest a large amount of data for a tax return or an audit, perhaps even all transactions, to look for irregularities. What happens if all, or at least most, business transactions can be accurately captured and classified? Both functions are happening now with first generation products. The algorithms in use are improving in accuracy as more data is processed and the rules in the algorithms are improved. Mainstream and startup vendors are beginning to sell these capabilities.
So, What Are Some Potential Tools to Use Today?
Multiple publishers are marketing products claiming that they have these problems solved today. While their techniques are beginning to work, don’t expect 100 percent solutions. Examples of products that are working for audit
include: Wolters Kluwer Audit Accelerator and TeamMate Analytics, MindBridge is making progress on data ingestion and classification, while new audit tools are being promoted by the competitors of AuditFile, MyWorkPapers and the AICPA’s OnPoint PCR. Most practical today for Client Accounting Services (CAS) practices are the two offerings from Receipt Bank: Extract and 1Tap which you can obtain via their Orange Select program. Extract is a document gathering tool that interfaces with various products, including QuickBooks. 1Tap is the first machine learning tool for accounting that has enough sophistication, simplicity, and accuracy to be useful to computer novices. The 1Tap application can be customized with your firm’s branding and delivered to clients for use on mobile devices to capture business documentation and classify it automatically for Schedule C clients. The vendor claims complete accuracy after classifying a transaction one time. Practically speaking, if you use Extract and 1Tap for one to two months with client data, you can expect high accuracy on automatically classifying and matching transactions based on supporting documentation.
And We Are Not Done Yet…
What can you do now? Recognize that if you keep your technology current, vendors will make new offerings available to plug into your technology infrastructure. Consider services offered by your firm today or ones you’d like to offer in the future. Create an innovation lab, or sandbox, that can be used for testing of new applications and techniques. Listen to your clients’ needs carefully while you are trying to assemble an offering. Test the offering with a few trusted clients and expand the offering into more of your base. Remember that you don’t want to give away the efficiencies gained by reducing fees. Over time, poor competitors are likely to compete on price, but initially you should compete on value. Use the extra time made available by the efficiencies of the application(s) to provide a higher level of service, perform more business development, reduce the workload of your team, or allocate the time to other worthwhile projects in your firm. Expect some of the applications to not work out as you expect, and act quickly to set these options aside. You may want to hold your work for deployment at a later time once the quality of the products improves and/or become more affordable. Remember to package service offerings as a product and have a marketing documentation and procedures to support the offering. Revise the procedures and offering frequently until you have it finely honed to fit your client base. There is broad FOMO (fear of missing out) and vendors are selling many partially baked offerings that aren’t really what is advertised. The keys to the offerings are: do they work sufficiently well today to be useful, are the affordable, and do clients and/or your firm have a better Celebrating our: experience while using them? If so, you can innovate with the innovative products today and be ready for the emerging technologies of tomorrow. 3
Celebrating our:
Please feel free to welcome your fellow members to our association with an email or call. Ellen Donovan at: edonovan@cpaconnect.com Improving Through Sharing.
Delong & Brower P.C.
MIRANDA CPA & Consulting LLC CPA
JPizars - CPA and Business Consultants LLC
238 Hoover Blvd., Suite 10 Holland, Michigan 49423 Phone: (616) 396-0500
609 E Tan Tara Cir. Ste 101 Sioux Falls, South 57108-4715 Phone: (605) 321-6735
1722 Sheridan Street #365 Hollywood, Florida 33020 Phone: (954) 997-2545
Chuck Brower - Leading Partner Email: chbrower@cpaholland.com
Michael R. Miranda - Leading Partner Email: mmiranda@mirandacpaconsult.com
Juan A. Pizars - Leading Partner Email: jpizars@cpa.com
Website: www.cpaholland.com
Website: mirandacpaconsult.com
Website: www.jpizars.com
Sponsor Firm: Brickley DeLong, PC
Sponsor Firm: Williams & Company CPA PC
Sponsor Firm: None
Geenen & Kolean, PC
L.F. Cochrane & Associates
Miller & Company PLC
246 S. River Ave., Suite 201 Holland, Michigan 49423 Phone: (616) 393-0398
2233 Santa Clara Avenue, Suite 8P Alameda, California 94501 Phone: (510) 985-9829
900 S Shackleford, Suite 100 Little Rock, Arkansas 72211 Phone: (501) 221-3343
Daniel J. Kolean - Managing Partner Email: dkolean@cpamichigan.com
Louise Cochrane - Managing Partner Email: louise@lfcochrane.com
Michael S. Miller - Leading Partner Email: mikem@millercocpas.net
Website: www.lfcochrane.com
Website: www.millercocpas.net
Sponsor Firm: None
Sponsor Firm: None
Douglas R. Geenen - Partner Email: dgeenen@cpamichigan.com Andrew Johnson - Partner Email: ajohnson@cpamichigan.com
Website: www.cpamichigan.com Sponsor Firm: None
Harshwal & Company LLP Oakland: 266 17th Street, Suite 200 Oakland, California 94612 Phone: (510) 452-5051 Albuquerque: 6739 Academy Road NE, Ste 130 Albuquerque, New Mexico 87109 Phone: (505) 814-1201 San Diego: 12225 World Trade Drive, Ste J San Diego, California 92128 Phone: (510) 452-5051
Sanwar Harshwal - Managing Partner Email: sanwar@harshwal.com
Website: www.harshwal.com Sponsor Firm: DZH Phillips
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Daniel D. Laskey Company, P.C. 507 Water Street Manistee, Michigan Phone: (231) 723-8305 Fax: (231) 723-6097 William E. Thompson - Managing Partner Email: thompson@laskeycpa.com
Website: www.laskeycpa.com Sponsor Firm: Brickley DeLong, PC
104 N. Main St., 5th Floor Gainesville, FL 32601 P: (352) 727-4070 www.cpaconnect.com A companion association of: