Paperless practice: The second wave

27th Jul 2011

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Editor at large

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John Stokdyk introduces a series of articles that will draw on the advice of accountants who have forged ahead with successful paperless practice techniques.

Over the next month, AccountingWEB will be publishing a series of articles looking at what we’re calling the "second wave" of paperless practice: tasks and activities that may not have triggered a firm’s move into document management, but which emerged as they developed more experience and confidence in the technology.

Many of the observations will draw on first-hand accounts and experiences of accountants and practice managers, including members of our Document Management discussion group. Group leader Charles Verrier is helping with this project and will compile a whitepaper that distils our research into some practical recommendations.

“The accountancy profession is going through a transition from a pure paper world to a purely online one,” says Verrier, who draws parallels between paperless practice and the evolution of efiling using iXBRL. “The process is gradual, and it's always the border between the two that causes the pain.” But with the advent of electronic P60s and 64-8s, and HMRC’s Real Time Information project on the way, “the direction is clear”, he adds.

The Paperless Practice series is about moving the profession out of the “early adopter” phase of document management into a practical productivity phase. For the purposes of this series, the basic cost, efficiency and storage benefits of paperless admin are taken as a given. Instead, the articles will focus on functions that are more specific to accountancy practice, including:

Client service
Marketing
Tax processing
Internal workflows

Client service

Client service is one of the top reasons for going paperless, but the aspect of service (and internal workflows) Charles Verrier would prioritise is risk management. “The heart of successfully defending PI disputes and regulatory audits is the quality of your documentation, and document management can be a huge help with this – not just because it improves the quality of the files, but because it demonstrates a firms’ commitment to quality,” he says.

“Document management systems often demand a more rigorous application of best practices within a firm. Sometimes users chafe at the demands being made of them by a new system - ‘I used to do this much faster the old way’ - but six months down the road, the reduction in missing or misfiled documents can be really quite noticeable.”

A digital filing system has an extra advantage over a paper one - it can be delivered digitally to as many places as it is needed. This is obviously a big help in multi-office practices, but it can also mean that files can be accessed online by clients.

“If clients can download stuff, then why not go one extra step and let them upload stuff? Don't get them to send tax records in the post, but save them instead as electronic copies in the firm’s secure portal. There's an argument that offering ‘self-service’ tools removes the personal touch but not having to move paper around leaves more time for more important things.

One disadvantage, however, warns Paul Johnston is that “clients expect a much faster response”.

Marketing

Many accountancy practices strive for linked document and client relationship management (CRM) systems that give them what some call a "whole client view" - where all correspondence, telephone notes, advice and client files are held in one place.

Having a more comprehensive picture of your clients and responding more quickly to their needs will improve your relationships with them and increase the likelihood of follow-up business. But this article will look at further opportunities for using client data and paperless communications to segment clients into different groups and deliver targeted messages to them.

Tax processing

Large amounts of tax work are predictable and rely on certain recurring types of document such as tax returns and other HMRC forms. The UK tax system is not quite as uniform as the US, where paperless tax processing is more prevalent, but we will be hearing from British firms that are making strides in this direction.

Tax, practice and OCR systems are growing to support this trend to the point where tax documentation can be compiled into electronic files for each client, with numerical data extracted automatically into tax software. Even where non-standard documents are encountered, intelligent systems can be “taught” to recognise forms they can't understand.

But this Utopia is taking a long time to arrive. Verrier suggests one reason why. “A system like this has to be trusted by staff so that they actually save time using it - rather than double-checking everything it does and so taking longer than they did when they just used paper!”

Internal processes and workflows

The fourth article will look at the impact paperless technology can have on how work is handled within the firm - for example when being passed from accounts department to tax department, or when multiple people are working on the same client files at the same time.

This is the realm of workflow software, which often drives “second wave” paperless implementations. Some solutions can be expensive as well as disruptive to office procedures and culture, but we will hear from experienced practitioners who have negotiated these hurdles.

To whet your appetite for the articles to come, Charles Verrier comments: “Document management can produce huge benefits, in terms of reducing error, enabling better client-service, fostering best practice, reducing PI risks, delivering significant disaster recovery benefits, and making information more accessible.”

In the weeks to come, we will show you how some firms have achieved these goals.

For a more detailed examination of these issues, download Charles Verrier's whitepaper for CCH, 'Realising the next wave of benefits'.

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John Stokdyk

Editor at large

AccountingWEB

John Stokdyk sadly passed away in June 2023. He had been with the site since 1999, rising from news editor to editor in chief, global editor and head of insight. As a roving editor, he investigated the profession's use of technology around the world. He devoted his spare time to technology history and an oddball collection of stringed...

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By thelma65

28th Jul 2011 11:25

a very good post indeed!

charles feel free to call me or mail me 07545431478 [email protected]

i work with accountants going paperless and fully integrate to all of the Practe management solutions to give the added benefit.

We work closley with 2020 and can offer help / advice if required

many thanks

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By Paul Scholes

28th Jul 2011 12:45

Information management

A timely article. It is refreshing, at last, to be looking at the next stage of development rather than dwelling on the paper/no paper debate which tended to cloud the valuable stuff.

Much like the part played by oil & the internal combustion engine in trasport, paper didn't just add practical difficulty in allowing the free flow of information it had taken on a life of its own and had become an obstacle to progress. In it's defence of course is that, in various forms, it has been around for thousands of years and so was/is not going to vanish overnight.

We are still on the cusp though and, I have to say that, in a way I feel the same way about the full-blown document management systems as I do about paper. The best illustration I suppose is in the practice that has grown up of scanning and tagging/indexing every bit of paper that enters a building rather then reading it and deciding what's best to do with the information it contains. Maybe it just confirms something you already know or is akin to a tephone call, the information from which leads to a tick box being completed.

Such paper is scrap and just continues to act as a hinderance only now someone has digitized it to remain forever taking up e-space, which is fast becoming the environmental elephant in the data centre.

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By derekgfrench

02nd Aug 2011 12:29

Scanning incoming post

Paul, I think you may be being a bit unfair. Many of those doing the scanning of incoming post are members of the admin team. They are perhaps not in a position of either knowledge or authority to decide what is, and what is not, appropriate to be scanned. Many Partners in my experience err on the side of caution and instruct most documents (except perhaps obvious marketing literature) to be scanned as a matter of course.

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By Paul Scholes

02nd Aug 2011 15:15

Hi Derek

Most practice within an office tends to be determined by the partners not the admin team and so it's not being unfair on the admin team to say the methods are inefficient.

The admin team scan everthing that comes in, presumably they might tag some of it that's obvious, say to a client, but much they might not and so is, presumably, held untagged. The partners then go through it all deciding what has to be tagged and to where and presumably wishing some could have been chucked. I'm only going on what others have told me in that short story but surely wouldn't it make sense for the partners to see the post, chuck out what's not needed then say what should happen to everything else, before it's scanned?

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By Cruncher Alan

03rd Aug 2011 12:54

Way Forward

We use IRIS and produce all letters from within the sofware (standard letters as much as posiible) and scan all incoming mail. File notes are typed directly into the computer and stored in the same place. All work flows are controlled from within the iRIS software but supplemented by shared spereadsheets so that we can all keep an overview of work allocations (vats, payrolls etc). We file everything online and don't keep paper copies of anything we do not need.

Accounts working papers are generally on Excel and so stored in the client folder on the network.

It easier to look up client records on screen than go and hunt for a file that could be out on someone else''s desk and I can do it from anywhere that I can get on to the internet. We are working across 4 offices and can access any client form any office.

Are we ahead of the game? I don't think so. There must be plenty of firms out there who are just like us.

But we need to know how other firms deal with the practicalities eg on IRIS, how do you put a file note on more than one client at the same time etc and all the other anoyances.What solutions do people use to allow clients to upload files for us to access?

We want to know what other experiences firms are having, what other solutions they have found.

Really looking forward to seeing the articles and reading the posts.

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