How to start automating your practice

Great article Richard, we believe automation will be the key to a successful accountancy practice in the future.

Our vision at AccountancyManager is exactly this, with automation at the heart of our operations.

We agree with Glenn Martin regarding the onboarding process, streamlining this is essential. That's why in AM the system automates proposals, letters of engagement and allows clients to fill out their information online with as little hassle as possible. To support this we've also built the function to automate requests of information from previous accountants.

And to remind clients of their deadlines once onboard (a common request from clients), we recently we just added "Client Deadlines" to their online portal.

Olly Evans has a point, collecting data from clients is very time consuming but already we are beginning to automate this process with the ability to set up automatic record requests and more importantly, currently developing an intelligent new system which will know when 'part records' are outstanding and automatically communicate this to the client.

And like Andrew Perrett says, "automate anything that reduces or eliminates the potential for (human) error" - this is what we're all about.

We should also mention that the opportunity that Alex Davis mentions regarding systemising the workflow using automation, again is something AM has already achieved. Our system works from the deadlines in the clients file and orders the workflow (specific for each staff member) in order of deadlines and then records received.

We do however agree that the fully automated practice is still a little way off. That's why our dream at AccountancyManager is to provide this, along with a "1 stop shop" from providing everything from marketing tools (hint - it's in the pipeline) to the final stage of filling accounts.

We're happy to work with other software in the market to produce this provided they share the same dream and are as passionate as we are about transforming the accountancy profession.

These issues in practice also apply to commerce & industry.

For example, here's a real world example for a purchase & payment process.

1. Requisitioner - located at this operational site in, say, Poland - wants to buy something. Types it into Google Forms.
2. His line manager authorises - who works, in say, Portugal - it in the resulting Google Sheet.
3. It turns out to be above his limit, so a 2nd authoriser co-authorises it in the same Google Sheet.
4. Somebody now has to type in a purchase order number into the Google Sheet.
5. The requisitioner has to log into the Google Sheet to get the PO number and quote it on order.
6. The vendor's invoice goes directly to the accounts team in head office in, say, England. It should quote a PO number, but the vendor doesn't care.
7. Somebody has to go find the PO entry and manually match it.
8. In any event, the invoice arrived by email, is downloaded to a server (hosted in AWS, in a VLAN, cannot be connected to the Googleverse) and its header details are typed into an invoice register (a spreadsheet on the server).
9. Once matched to the PO, the PO number is also typed into the invoice register, at which point it becomes eligible for typing into the accounting system (which is also an AWS server, in a VLAN with no connection to Google).
10. The invoice is typed into the accounting system, which is the final resting place for the document.
11. The ordered goods fail to arrive properly, so the requisitioner marks as such in the Google Sheet (which contains space for the goods received process). The invoice can be part-paid, part-disputed. The requisitioner disputes it (the vendor is in the same country as him).
12. The payment clerk drafts a payment run and manually goes hunting for each PO to see whether it can be paid, and to what extent.
13. For those items qualifying for payment, the cheque run report from the accounting system is distilled in Excel to convert its legacy "printy-printy" format into pure data.
14. The pure data is copy-pasted into the banking system. (Yes, that's right, HSBCnet does NOT support the import of CSV files. Go figure.)

What off-the-shelf software might automate this?

With Brexit and MTD being the issues that will be affecting all businesses in some way or another, by speeding up the transmission and processing of data between all of the parties involved will ensure the UK PLC will become much more flexible for the challenges ahead.

However integration across the various interfaces such as customer -> bank -> accounting practice -> HMRC is poorly defined. Poorly defined interfaces mean NO automation. Period.

Software vendors such as Sage, QB, Xero etc etc will obviously defend their market share and hence cooperating on the development and implementation of a new data interoperability standard is unlikely.

Standards for interoperability have to be driven by the industry. For example in networking the X series standards e.g. X.25 was specified by an industry body CCITT and all the software players supported it and layered their solutions upon it for the general good of the IT user.

The accountancy profession needs to lead the way and create an open standard for the communication of accounting data. If the end user e.g. the small business plumber is able to follow a simple prescriptive system for accurately entering their own figures, the accounting practices can focus on adding value to the business community rather than sorting through carrier bags of receipts. They can also pass on accounts to HMRC more quickly and have a chance of handling possibly 5 tax returns a year with MTD whereas at the moment some will be struggling to do 1.

Great article Richard. No doubt data chasing and data entry takes a lot of precious time of accountants and their practice staff. And, not to mention, these tasks are not game changers for any practice, yet sometimes too frustrating. We found out this problem a few years back when we started back-office service for accountants.

To address this problem we have made Receipt Bot (www.receipt-bot.com). We aim to solve three problems:
- Flow of data from clients to firm should be automatic
- Data sharing from clients should be daily/weekly rather than waiting for months.
- Data entry should be automatic, and the system should learn to code the expenses to right categories.
- Enabling accountants to keep on the top of deadlines

Currently, we are in the final stages of our live beta. Receipt Bot integrates with Xero and QuickBooks Online, while SageOne integration is in the final stages.