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Tax & AccountingJuly 26, 2023

Adapting technology for traditional tax firm workflows

A lot has been written about technology transformation in accounting firms, but for many firms, sweeping changes are not practical or even necessary. Incremental technology implementation can help more traditional tax firms adapt to new market conditions while supporting existing tax preparation workflows. Firms can benefit from modest changes without completely overhauling their processes.

Analog vs. digital — improve accuracy by reducing paper

Paper-based income tax workflows invite errors and omissions by relying on manual collection and data entry. Pages of source documents are easy to misplace and difficult to search. On the other hand, electronic document collection is convenient for clients and staff. Clients can provide documents as soon as they receive them, and staff can see at a glance what information is available and what is missing.

Reducing or eliminating manual data entry is a welcome change that improves quality as well as morale. Use optical character recognition and an AutoFlow solution to pull data from source documents into the tax return. This type of tax preparation automation reduces data entry errors, enabling preparers to do a first-level review early in the process.

Manual vs. automated — focus on expertise, not calculations

A tax professional’s primary strength is understanding complex tax rules and changing regulations. Unfortunately, the fast pace of change has left some tax software providers struggling to keep up. Many tax professionals end up performing unnecessary manual work because their tax software offers limited forms, calculations and data imports. Often, the most complex returns require the most manual effort, leaving the professional with less time for the bigger picture.

With a comprehensive tax preparation software solution, tax firms can efficiently complete their most complex returns without getting bogged down in work that can be automated. Additionally, as automation makes simple returns more and more efficient, firms can take on higher-value work without compromising accuracy.

Disruption vs. responsiveness — reduce downtime with reliable support

Reliability is critical, especially during busy season. Clients expect their tax professionals to be responsive, and firms need to be confident that their software is up to the challenge. Downtime, whether in the form of software outages or unexpected/unresolved errors, can have a negative effect on the firm’s profitability and client relationships.

When a problem or question arises, it’s important that help is available as quickly as possible. On-demand support tools, like an easily searchable knowledge base, including how-to videos, make it easier to find information. An online community of peers may provide innovative ideas and new ways of doing something when there is no clearly right or wrong answer. A chatbot can answer common questions without sifting through pages of articles. And in cases when self-guided help is not enough, phone support should be readily available at no extra charge.

Ad hoc vs. standardized — take a strategic approach to data security

New digital tools enable more productive and efficient work, but also create new challenges for data security. Although most firms do not employ a dedicated IT expert, it’s important to stay up to date on security best practices, like multifactor authentication and inactivity timeouts. Having security policies and systems in place is always better than an ad hoc approach.

Data backups, disaster recovery plans and business continuity are also important parts of a data security strategy. Many firms alleviate these challenges by choosing cloud-based systems or remote hosting providers. These vendors typically have extensive security resources and testing procedures in place.

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A digital tax workflow is within reach

A digital tax workflow doesn’t have to create upheaval within an established firm. In fact, by making the right choices, firms can achieve accurate, reliable and secure tax compliance without making drastic changes to their processes. 

Product Marketing Manager, Tax

Aimee Hall is a product marketing manager for Wolters Kluwer Tax and Accounting US, focusing on the professional market. In this role, she is responsible for leading the marketing strategy for tax software products including CCH Axcess Tax, CCH ProSystem fx Tax and ATX Tax. She joined Wolters Kluwer in 2006 and lives in the Chicago suburbs.

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