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Digitalise your accountancy practice: How to help your employees

Technology & Innovation

Digitalise your accountancy practice: How to help your employees

This is the age of the digital accountancy practice. In fact, digitalisation is one of the most important factors shaping the development of the accountancy profession today.

According to the Practice of Now report carried out by Sage, 57% of surveyed accountants said technological literacy is the most important additional skill that’s required to succeed.

This is in part due to HMRC moving to digitise (and simplify) the tax system and the requirement for accountants to utilise technology, including cloud-based accounting software and business solutions, when supporting their clients.

A particular driver of digitalisation has been HMRC’s Making Tax Digital (MTD) initiative, which aims to use technology to make the tax system more effective and efficient.

MTD has already had an impact on VAT since eligible VAT-registered businesses that have a taxable turnover above £85,000 are now required to keep digital VAT business records and send returns using MTD-compatible software.

New ways of working

The trend towards digitalisation is only going to continue to accelerate. But while accountancy practices generally understand that they need to embrace it, they can struggle with its real-life implications.

Typically, digitalisation involves a move away from Excel spreadsheets and desktop accounting software towards cloud-based accounting software, which in turn tends to result in new processes and ways of working.

Some employees may feel uncomfortable with the new direction that the firm is taking, or believe they lack the skill set that will enable them to flourish in a more digitalised environment.

So what actions can partners, managers and other leaders at your practice take to support your staff with the transition?

1. Train and retrain staff in new systems

Your staff will feel more comfortable about using new systems if they have received comprehensive training in them.

It is also important they receive additional training as new software updates are released and that they have access to post-training follow ups.

As well as formal training sessions, held face to face and online, your staff can benefit from informal sessions, such as ‘lunch and learn’ events, as well.

US-based WithumSmith + Brown, a member of the HLB global accounting network, is committed to using the latest cloud solutions across its audit, tax and advisory service lines.

It believes that best-of-breed technology enables its staff to work flexibly in the way they want, which means they service clients better and deliver revenue growth.

Withum also understands that if its staff are to get the best out of its systems, they need to be skilled at using them and have high levels of cyber awareness.

“We invest a lot of time and effort in training,” says Jim Bourke, partner and managing director of advisory services at Withum. “Whenever we deploy new technologies, we roll out mandatory training for all our staff.

“Also, because we use so many web-based systems, we make it mandatory for our staff to watch a cybersecurity awareness video every quarter.”

While all staff receive standard training in the new systems, there is a core team that receives additional training so they can support the rest of the staff.

In addition, the practice has a learning coordinator who works with staff on their training plans.

“If the learning coordinator sees that staff need support with specific technologies, we make sure we deliver training to them,” explains Bourke.

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2. Recognise that working processes may need to change

New technologies can enable your accountancy practice to operate far more efficiently and effectively than it has ever operated before. However, this will only happen if working processes change alongside the implementation of new systems.

Your staff need to adjust how they work so they can take full advantage of the convenience of technology and the opportunities it presents to build stronger relationships with clients and generate new business opportunities.

Base 52, an accountancy practice in Hitchin, Hertfordshire, has embarked on a change programme that involves using technology more effectively to improve its processes.

It has selected a software package that it plans to roll out to the majority of its clients and is using scanning software for data capture. It’s also implementing a workflow management tool so it can better control and prioritise jobs and resources.

Working processes have inevitably had to change as part of the transformation.

“We have redefined job roles and responsibilities to accommodate the new systems so that processing, review, analysis and client support are provided at the right level,” explains managing director Fred McBreen.

“We used to be organised by work type – for example, year-end accounts, personal tax, bookkeeping and VAT. But we are now structured in teams who look after all the work for a set a specific business clients.

“Within the teams, there is a hierarchy of roles so that basic processing work is done at a junior/trainee level, which is facilitated by the new technology.

“Managers are then freed up to spending more time looking after clients, reviewing work and carrying out higher-level analysis.”

3. Communicate and engage

Information about digital transformation should be communicated clearly and regularly to your staff, and in ways that solicit their engagement.

A range of technological tools can be used to provide updates on changes – from the humble email through to your practice’s intranet or an instant messaging platform.

Often face-to-face channels, such as town hall meetings and off-site days, can be the best way to communicate about change in the first instance.

They give your staff an opportunity to ask questions in an open environment and offer their own suggestions as to how processes and systems could be improved.

Della Hudson set up Bristol-based Hudson Accountants in 2009, running the business until she sold it in 2017.

She used cloud accounting software from the outset because she thought it would keep her IT responsibilities to a minimum and enable her business to maximise its profitability.

In addition, she recognised that staff in the firm needed to be actively committed to continuous improvement if they were to take full advantage of the technological tools that they had at their disposal.

“Communication is key in a cloud-based accountancy practice where people might work part time or at home,” says Hudson, “so we had a two-hour lunch and learn session, with pizza, every month. During that session, anybody who had been on a training course would share what they had learned.

“Also, if there was anything that people had thought could be done better, this would be the forum to raise it. It was also an opportunity to share the way we wanted the firm to move as a whole.

“I believe that if the team understands the values, they can fill in the gaps where there aren’t any written processes.”

Return on investment

Successful digital transformation requires a significant investment in time and effort on the part of any accountancy practice.

Inevitably, there will be some challenges with getting your staff up to speed with new systems and processes.

To address these challenges and to encourage your employees to embrace digitalisation, your accountancy practice needs to review transformation from a holistic perspective.

This means considering matters such as communication, culture, training and working processes, as well as the systems that will be most suitable for your practice and the needs of your particular client base.

Editor’s note: This article was first published in November 2019 and has been updated for relevance.

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