Practice management: This spring’s must-have software

“Now that the madness of January is out of the way and to break the endless stream of MTD talk I am looking at practice management software.”

On the night before the self assessment deadline day, AccountingWEB received an email message from our roving software scout in the North of England, Glennzy.

We took it as a portent of things to come.

For a long time, practice management has been the neglected child on the accounting software scene. In our 2013 software survey, just 10% of respondents used practice management tools, compared to 23% each for tax and accounts production.

Since then, mentions of practice management software has fallen among firms entering Practice Excellence awards from 18% in 2014 to 11% in 2016.

At the same time, however, interest in social media, face to face networking and other marketing activities has exploded among this group. To be effective, all of this outreach work needs to be managed, but only 29% of the entrants to our 2016 Practice Excellence Awards appeared to have a system to record their marketing efforts or track referrals.

Some firms are happy to rely on specialist customer relationship management (CRM) tools for this activity, but the usual complaint from accountants who have experimented with the software is that it doesn’t quite match the requirements of accounting practitioners. They need software that can record know your client (KYC) and anti-money laundering information, manage clients between different partners and teams or link client communications and marketing to tracking tax, accounts and related tasks.

The amount of activity we spotted in this part of the market over the winter indicates that we’re not the only ones to have noticed this particular gap. The moves are coming from all directions - from newcomers like Prosper, mTrio and Senta as well as industry stalwarts such as BTCSoftware, Exact, Sage, TaxCalc, Thomson Reuters, Xero and Wolters Kluwer.

There’s another reason for the sudden surge of interest in practice management this spring. Though Glennzy was desperate to escape the clutches of MTD, it reaches into the very heart of your practice management systems.

Quarterly reporting isn’t quite the “four tax deadlines” conjured up by the headlines. It’s a much more complex sequence of tasks that will require practitioners to manage and remind clients about their obligations every three months. Self assessment is simple in comparison: you’ve got one big batch to communicate with and a single deadline to aim towards.

MTD will highlight any internal weak spots in managing late clients, communicating the importance of keeping accurate records (and the value practices provide in this area). And it’s going to be far easier to adapt to the new processes and requirements with specially designed tools rather than relying on existing spreadsheets or paper systems.

We have already seen a more relaxed attitude to MTD from cloud pioneers and firms that have sign their clients up for regular management reporting, and these tend to be the same practices that are adopting practice management applications to support those activities.

AccountingWEB has been reporting similar things from the different companies that will be targeting practices with new offerings this spring. They include:

• Entry level “all in one” bookkeeping and practice software providers such as Gbooks, Capium, Nomisma
• “Best of breed” cloud newcomers including Senta, mTrio and Prosper
• Add-on developers such as Karbon, Practice Ignition working in tandem cloud accounting engines - and not forgetting Xero itself.
• The suite providers, who are all shifting resources into cloud solutions: BTC, CCH, IRIS, Sage, TaxCalc and Thomson Reuters.

In Glennzy’s case, he’s most interested in the new breed of cloud practice management systems than integrated suites. But there are options aplenty to meet the needs of every kind of firm.  Until now practice management has been seen as an extra frill (or expense) on the software menu. But when faced with such a tight timetable for implementing the new digital tax regime, there really is no better time to reconsider your practice processes and systems.

------------

For a detailed comparison of best practice management software for accountants and individual software user reviews, visit AccountingWEB’s Practice Management Software category page in Software Reviews.

------------