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Tax software tour: CCH Taxpoint

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25th Dec 2005
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CCH

Introduction
For CCH Software, the Taxpoint personal tax program is the starting point for wider engagement with accountancy firms than extends beyond tax computations. CCH personal tax product manager Wendy Rowe comments, "Tax software is all pretty much the same. We want to show what users can do with the data to analyse it and report on it to add value."

CCH targets larger accountancy practices and currently claims Taxpoint is used within 1,100 UK firms. One way of telling how powerful a tax application is is to look under the bonnet to see what kind of database system is driving it. In addition to the entry-level Microsoft Access, Taxpoint can be supplied to run with both MS SQL Server and Oracle databases. The former gives CCH a route to exploit some of the functionality of the .NET architecture, while the latter caters for the very largest, global organisations.

Taxpoint
The Taxpoint personal tax module is one of ten or so separate functional elements that run off the same database. CCH also owns the PROacc range of practice software tools and has put considerable effort into integrating the tax and practice products with each other as well as with the company's professional data services such as CCH Business Focus.

Taxpoint is a spohisticated and powerful tax computation tool that includes a comprehensive set of data entry, reporting, administration and maintenance menus. The Taxpoint menu bar includes an Excel option that crops up on several occasions during the demonstration for reporting and data entry options. The import and application interface features are also used by CCH to help get clients up and running when they migrate from rival tax software systems.

Taxpoint's full capabilities do not leap up and grab the user in the first instance, but the functionality will often be unlocked through consultancy and bespoke work to fit Taxpoint to the needs of the user firm.

"Its basic function is to produce a tax return as efficiently as possible. But people do things in different ways," said Rowe. "Flexibility is the key so that you are able to support those workflow processes in different ways."

The application supports both electronic filing options, the older Electronic Lodgement System (which may not last beyond the current tax year) and the newer Filing by Internet gateway. Agents using Taxpoint can file returns for individuals via FBI and partnership returns are currently in test for the 2003/04 tax year.

Pricing
The entry point for a single-user Taxpoint system is £1,100 - £600 for the basic licence and £500 for the annual maintenance fee, which will recur each following year. Beyond that princing is based on the number of concurrent users, the modules used and in some cases the number of clients handled. Where a customer does is supplied a particular module CCH will consider bespoke licence arrangements and there are cost breaks available if the system is used alongside the PRO practice software tools.

Interface
The screen layout of Taxpoint confirms the product as a typical Windows implementation, with a standard menu layout providing options for data entry via graphical tax forms (from a choice of 19) or from spreadsheet-like tables when the user is handling bulk input. Double-clicking individual boxes within the on-screen forms lets the user "drill-down" to a data-entry table showing how the figure is broken down. The entire

Two interesting variations help the user track what they're doing. Under the IR Forms menu, those forms that have had data put into them are marked on the menu with an asterisk. If users want, they can also navigate around the system using the Fast Path window. This lists each of the available modules, which can be accessed by clicking the appropriate hyperlink. The Fast Path menu includes tick boxes, which can be used to signal completion of a return against a particular task; these indicators can then be picked up later for progress reporting.

Integration tools
Among the discreet features that Rowe highlights as Taxpoint's strengths are its application programming interfaces (APIs). These software hooks are used to tie together different functions within the application - from importing and converting data from other applications to communication with internal modules and external programs like Microsoft Word and Windows.

Example of the Excel coupling include spreadsheets for dealing with income from ex-patriots and for partnership tax returns. The partnership tool was developed to help one of CCH's customers with 250+ partners and is now supplied with the application. The spreadsheet allows the user to allocate partnership splits and record details such as residence, entry date to the partnership and the accounting basis period, all of which can be posted into Taxpoint with the click of a button on the spreadsheet. Work is now in hand to create a toolkit that will allow users to construct their own Excel spreadsheets that can work in the same way with Taxpoint.

Elsewhere, Excel is the basic interface for the Taxpoint query tool. Using the Microsoft Query processes, the user can construct a query within Excel to interrogate the Taxpoint database and to analyse and sort the results - or even export them as an OLAP cube for multidimensional work.

Again, Excel is not the most intuitive interrogation tool, but as Rowe points out, most accountants and tax agents know how to use spreadsheets. "Lots of people use Excel to query ad hoc things. Or they save database searches and rerun them each year - for example to identify those clients with company car benefits. You can pull out the fuel benefit, make of car and even the emissions rating from Taxpoint. and because it's in Excel, you can run a mail merge against it."

The mail merge option highlights another area of integration, this time with Microsoft Word, which forms the basis of the Taxpoint Letter Generator. Many firms use the Word processor to create libraries of standard letters relating to different client queries and tax issues. If the Excel spreadsheet mail merge route is too complicated, the user can also follow the processes set out in the Word mail merge menu - all linked to the client data in Taxpoint via the APIs, Rowe explained.

Administration
The bigger the firm, the more it will need features to administer and track the progress of its client tax work. The routines under Taxpoint's Administration menu are based around a User task list and a Client task list.

Taxpoint comes with a set of standard tasks relating to each client and their tax return and a set of ready-made reports. Since firms work in different ways, Taxpoint leaves plenty of scope for the user to adapt both client and user tasks to reflect their own workflow processes.

The manager can set up particular tasks and asign up to 100 categories for things such as the relevant partner, manager and case work. All of these data items can then be extracted by querying the database to produce bespoke reports - once again using the program's in-built APIs. The flexibility is huge, Rowe acknowledges, but a firm will often
need to work with CCH to create workflow patters and reports in the software to cater for their specific needs.

Add-ons and enhancements
As noted in the introduction, Taxpoint is not designed to be operated in isolation. The additional modules include business and personal tax planning, links to CCH's online information resources and Tax Manager, which adds tax return reviews and risk assessments to the basic admin functions within Taxpoint.

Tax Manager - Formerly known as Investigator, this module takes the ELS or XML output file from Taxpoint and helps the human manager to examine it for anomalies that might attract unwelcome attention from Revenue investigators, or for missed opportunities for financial planning. Income from self-employment, for example, can be compared against the norms for the specific industry assessed in CCH's Business Focus service - essentially the same measurements used by compliance officers.

CCH British Tax Library - As well as Business Focus, the user can also interrogate CCH tax data products from within Taxpoint and related modules. Clicking a toolbar icon activates Folio View, a slightly old-fashioned viewer which sits on top of a mountain of information. Using Windows cut and paste functions, the individual user can add a note to the tax return that cites the specific point of legislation.

eTax is a broswer-based tool that can sit either on the firm's website or intranet. In the latter situation, eTax can provide a simple data entry screen for occasional staff (without the expense of an extra Taxpoint licence). But eTax is more commonly used externally as a self-service input tool that allows clients to enter their own income details. The Taxpoint user can then arrive each morning to view the updated information and process it into the tax application.

ClientRelate - This application is the one that justifies CCH's marketing hype about the "shared intelligence" made possible by its extensive information and software resources. Experts in the CCH Information team scan new legislation and tax changes on behalf of clients and create pre-canned MS Query files that users can run against their own databases. More recently, CCH has been finding that clients have come to them asking for different types of database query and if applicable, these, too, are sent out to the ClientRelate customer base.

Simply clicking a link in the ClientRelate email identies the clients affected and runs a mail merge routine to extract their details and generate a ready-written form letter - ready for printing (or emailing) and dispatch. As Rowe comments, "Not everyone will use MS Query or Crystal Reports. This is a way of using the technology to create queries for them."

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